If Allegis was the disease, is Xylem the cure?

More than 30 years ago Donald Trump managed to bring a visionary $2.3billion enterprise to its knees with a single withering remark. It wasn’t about the competence of the CEO, or the virtue of his problematic strategy. It was about the name of the company.

It was February 1987: Richard Ferris, CEO of UAL Corp., fatefully announced his company would, henceforth, be known as Allegis.

The name change was intended to reflect the broadened scope of the expensively constructed travel enterprise that included Hertz Car Rental, Westin and Hilton International hotel chains, as well as United Airlines.

“We are a travel company, not just a transportation company”, said Ferris. “Allegis clearly identifies us as the only corporation that can offer travelers door-to-door service.”

Investor activist Donald Trump saw things differently. ”It sounds like the next world-class disease,” was his biased diagnosis.

It was the beginning of the end for Ferris and Allegis. Investor discontent coalesced around the name change and within six months Ferris was gone and his grand plan was being dismantled.

Introducing Xylem and Exelis

What was not so easily quelled was the fear and loathing Allegis had generated about corporate names. More than three decades later the fallout still swirled around the corners of boardrooms like a toxic mist. “Don’t give us an Allegis” was the joke, and behind it there was real fear.

The chaotic creativity of the Internet age has eased the anxiety. The likes of Google, Hulu, Zoomba, Skype and Zoosk have, out of necessity, attuned our ears to exotic and unfamiliar nomenclature but not enough to prevent the occasional atavistic twitch from sections of the media over what they characterize gleefully as “disastrous corporate rebrandings”.

There are signs of a real thaw, however. Recently, the conglomerate now known as ITT decided to split itself into three, spinning off its water treatment business and its military business. After much deliberation by Lippincott, the same branding company that gave the world Allegis, they brought forth “Xylem” and “Exelis” as the names for the two new entities. They were met with the dull thud of indifference.

Only a botanist would know that Xylem is a Greek-derived word that refers to vascular tissue that carries water and nutrients through plants. Likewise, it would take a lepidopterist to know that Exelis is a genus of moth, but one can hazard a guess at the intended meaning. In reality both names are, to all intents and purposes, gloriously meaningless.

Where is the outrage, the rending of garments, the gnashing of teeth? There is none.

Admittedly, Qwikster has been given up by Netflix as a juicy sacrificial offering to placate the Rebranding Disaster Gods but Xylem may be the miracle drug it sounds like it should be.

Could Xylem be the cure for Allegis — that most pernicious of name-aversion diseases first exhibited by Donald Trump 34 years ago?

Get over it – initials can be names, too

PricewaterhouseCoopers has finally bowed to the inevitable. Twelve years after this verbal procession of a name was created out the merger of Price Waterhouse and Coopers & Lybrand, the accounting firm has decided it’s OK to be PwC.

And the organization that was National Public Radio says it now wants to be known just as plain NPR. It has changed its name accordingly and told its staff and some 900 affiliated stations to use only the initials on the air or online because NPR is more than radio and public is, well, just not understood.

So NPR does not stand for anything anymore. It is not an abbreviation. NPR is NPR. Just as PwC is PwC. OK?

Well, no. Not according to branding consultants.

Now, there’s not many things branding consultants agree on. They can’t agree on what branding is for pity’s sake. But when it comes to initials masquerading as names they will stamp their feet in exasperated and petulant unison…ooh, a unanimous and forceful No!

They will tell you initials are devoid of meaning; they are cold and impersonal; there are lots of other companies with meaningless initials out there and you’ll get lost in the alphabet soupiness of obscurity; and, here’s their clincher, you will never get the URL.


Names, not initials.

Don’t even try to point out that IBM, AT&T, and GE seem to have managed with initials, they speak as one on this. They will tell you they were famous as International Business Machines, American Telephone and Telegraph, and General Electric long before they became initialized. And what’s more, they spent millions of dollars over decades building the awareness they enjoy today.

But hold on a minute. Isn’t that what all brands have to do? Don’t marketers spend millions of dollars building awareness of brands with weird names, such as Nike, Lexus, Samsung, Huawei, Xerox and Sony?

Why then is it OK for, say, Santander and not OK for HSBC? Why is it OK for Verizon and not HTC? And why is it OK for Lexus, and not for BMW? (and, unless you live in Munich, don’t try to tell me that Bayerische Motoren Werke was a household name before BMW became a luxury car brand).

What IBM, AT&T and GE have spent millions of dollars on is escaping the legacy meaning of their names. AT&T has tried mightily to shake-off its bureaucratic, regulated, stodgy monopoly perception of American Telephone & Telegraph. There’s not much demand for telegraphers these days and wireless has just about killed the  long-distance business. AT&T’s problem is that it doesn’t quite know what it is as a business and hasn’t known for a long time.

ITT has made a better job of it. The conglomerate that used to be International Telephone & Telegraph is long dead. It was broken up years ago. ITT today is a very successful global manufacturer of pumps and valves. Very few people outside the company know where those initials came from. They just know it as ITT.

And how about NCR? It started life as National Cash Register in 1884 making those wonderfully ornate mechanical cash registers that every store used to have. If you know it at all you will know NCR today as the name of a successful global technology company leading how the world connects, interacts and transacts with business (at least, that’s how it describes itself).

Both NCR and ITT are very successful global companies. They have stayed successful because they have evolved and changed, and so has the meaning of their names. No customer of NCR thinks he is doing business with National Cash Register. He does business with NCR. It doesn’t have to stand for anything other than what it is – the name of a company that contains the letters n, c, and r. And the fact that most people have never heard of it is perfectly OK.

Not all company names are meant to be household names. But in the branding presentations up go the slides with names of companies you’ve never heard of in order to make a tritely tendentious point.

But not all companies want to be famous, Laura

Who’s heard of AES, CHS, HCA, CCIM…No one? So there, ipso facto, initials don’t work because no one knows what these companies do.

Well, how about a slide with names such as Oneok, Synnex, Becton Dickinson, Henry Schein, Weyerhaeuser, Tutor Perini, Mylan, Lubrizol, and Centene. These are not obscure Mom and Pops put there to bias a point, they are all Fortune 500 companies. Does it prove anything at all that most people cannot tell you who they are or what they do?

What it does prove is that name recognition is all about context. The names on both lists are known to the people who need to know them. AES may not be on everyone’s lips down at the bingo hall, but in the world of energy generation it’s known the world over.  Likewise, HCA is a $30 billion owner and operator of hospitals and surgical facilities, coming in at 77 on the Fortune 500 above American Express and DuPont. Who knows HCA? Healthcare professionals do.

Whatever definition of branding you prefer, it is not about making a name “famous” – that’s an advertising mentality.

Acronyms are no different. They just pretend to be words. IKEA, IHOP, GEICO and AFLAC are acronyms. Does it help me to know IKEA is a composite of the first letters in the Swedish founder Ingvar Kamprad’s name in addition to the first letters of the names of the property and the village in which he grew up – Elmtaryd and Agunnaryd? Or is it enough for me to know IKEA as the name of a furniture store? I think so. Just as it’s enough for me to know ESPN is the name of a sports network, DHL is an international express mail service and HTC makes very cool smart phones.

The quietly brilliant story of HTC

HTC? Well, OK, way back it started life as High Tech Computer before it became HTC but, really, who knows and who cares? HTC is the name of the fastest growing manufacturer of smart phones today. The Taiwanese company is outpacing “proper name” incumbents Nokia and Motorola with its sexy, Android-powered products. And it is intent on building a consumer-facing brand around a positioning of “Quietly Brilliant.” In the world of smart phone gadgets and texting, HTC will become the perfect synonym for cool.

Too much is made of sniffy inherent meaning when it comes to names. Who cares that Nike was the Greek goddess of victory? Nike is Nike. What is the meaning of Nokia and Motorola? What is the meaning of Elvis?

As Susan Brind Morrow wrote: “A name is a mirror to catch the soul of a thing.”

[NB: As with all naming strategies, you have to know when initials work and when they don’t. See how Computer Associates got it wrong here.]

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