Corporate rebrands: surviving the change

Rebrands are designed to reinvigorate a marque, but PROs must manage negative – as well as positive – attention.

What a difference a year makes. Last March, supermarket chain Wm Morrison was riding high. Having just been lauded by the City for completing its £2.9bn purchase of rival Safeway, it saw its share price rise and made it to the top of PRWeek’s Reputation Monitor.

But the company’s reputation has since suffered. Stories in the business pages of the national papers last month referred to Safeway ‘dragging down’ Morrisons after it reported a profits warning. A Guardian headline said it all: ‘Morrisons joins Christmas casualties.’

The perception of Morrisons among the media and City is that its rebranding of Safeway has faltered, which illustrates the tricky nature of the PR job surrounding name changes – PROs are charged with making sure that media and consumers are aware of the nature of the new identity, but must often bear the blame when the headlines turn against it.

Waitrose v Morrisons

Morrisons’ City image has not been aided by the Waitrose factor. The

retailer, owned by John Lewis Partnership (JLP), bought 19 Safeway stores from Morrisons and rebranded them last year. It has been credited in the media for having done a successful job of hanging on to shoppers and poaching customers from rival stores – always the ultimate aim of a rebrand.

Waitrose marketing director Christian Cull says a lot of effort went into bringing former Safeway staff on side, including reassuring them that JLP was a good employer. ‘You’re only as good as the people on the shop floor,’ says Cull. ‘They are our ambassadors.’ This was aided by JLP’s reputation for employee benefits – last month it was announced that ‘partners’ (JLP-speak for staff) would receive bonuses equivalent to two months’ pay in 2005.

Cull and his team were also conscious that they needed to communicate the message that Waitrose was not an expensive supermarket. ‘We underpinned this by also talking about our commitment to fresh food and the brand’s values,’ says Cull.

The team also had tangible news to communicate – the conversions had created wider aisles and lower shelves, making shopping easier. But merchandisers also managed to squeeze in extra product lines, offering more choice.

Much of the media relations effort was concentrated at local level.

Although Morrisons also worked in this area, inviting local media to store-opening ceremonies and sending out press releases detailing new jobs at individual stores, it had less of a tangible difference to communicate. Its main message was that its stores included a

number of separate ‘stores within stores’ (a specialist fishmonger and bakery, for example). However, most supermarkets already had these;

Morrisons difference was that the ‘shops’ were given individual identities.

Keeping local papers happy

There are options when announcing a name change. Sending out press

releases detailing the change is valid, especially if there are solid business strategy reasons that need to be explained. This is common practice with retail rebrands where consumers will be interested to read about changes at their local store.

But local media news editors are eagle-eyed spotters of negative angles. When the Lunn Poly chain of travel agents was rebranded as Thomson last December, the challenge for head of PR Rachel O’Reilly wasn’t so much one of establishing awareness as heading off rumours of job cuts.

‘Thomson owns Lunn Poly and most customers were already aware of the relationship,’ explains O’Reilly. ‘But the problem was that the announcement of the name change came only weeks after Thomson owner TUI had revealed plans for a large-scale corporate restructure involving 800 job losses across the business.’

In light of that news, the decision to focus on the Thomson name made

perfect sense. But it also led to some local papers ‘putting two and two together and wondering in print whether their local travel agent was going to close,’ says O’Reilly. The fact that the travel trade was known to be suffering from the impact of internet booking added fuel to this fire.

O’Reilly’s task of rebutting these rumours was made more difficult by the fact that ‘we were looking at the leases on some shops’. O’Reilly, with sales and marketing director Miles Morgan, set about the task of reassuring staff and customers via interviews with local press and radio. However, headlines such as ‘Thomson wields axe on staff and stores’ (The Birmingham Post) were not uncommon.

Pressing the flesh

For non-retail businesses, where the end-user is less interested in the commercial rationale behind a change, traditional media relations has a lesser role to play; it is often more effective to actually meet consumers, as debit card brand Switch discovered.

It is in the process of changing its name to global counterpart Maestro. The company had found that Britons abroad were failing to use their Switch cards to withdraw money or make payments in shops simply because they didn’t realise they could use their card wherever a Maestro logo appears on ATMs or tills. With a common brand the company hopes consumers will be less confused.

TV advertising featuring penguins ran last year to introduce the idea of the merged brand, underpinned with a PR campaign by Starfish Communications involving roadshows in shopping centres throughout the country. People in penguin suits handed out leaflets explaining the change to shoppers likely to have just used their Switch card.

‘Unlike some of these name changes that seem to be all about globalisation and saving money – such as Marathon turning into Snickers or Opal Fruits into Starburst – Switch has a sound

rationale for changing to Maestro,’ explains Starfish joint managing partner Julien Speed. ‘When we explained that to consumers they could see the wisdom of it.’

Once the initial announcement phase is completed, it is often hard to keep up the momentum of publicity, particularly if you’re faced with the task of getting a predominantly B2B brand into the tabloids. This wasn’t a problem at DHL, which brought the Securicor Omega Express, Danzas and Euro Express brands under a single umbrella last April.

In parallel with a large-scale operation to instil staff with ‘DHL values’, the communications team found a variety of creative ways to keep the DHL name in the press. It released stories documenting how the firm had transported goods for various charity and sporting events, including a BBC Radio 5 football shirt amnesty.

The company was never going to be the main part of these stories but it succeeded in getting name checks in most of them, helping to underline one of the rebranding’s main messages – the breadth of services provided by the ‘new DHL’.

The only thing media relations manager Matthew Zamoyski was unhappy about was The Sun’s treatment of a Euro 2004 story about supplies that DHL had sent to Portugal for the England football team (including hair gel). The paper quoted a DHL spokesman as saying: ‘I don’t know why all those baldies need hair gel.’

It might have led to a few embarrassed calls to the Football Association to set the record straight, but in terms of achieving awareness of DHL, the coverage was beneficial.

Recent rebrands


Wm Morrison bought the Safeway supermarket chain in March 2004 after a protracted ownership battle partly fought through the City pages of the national press.

The terms of the judgement by the Office of Fair Trading meant Morrisons had to immediately sell off 14 of the Safeway stores to Waitrose (it also sold five of its own stores to Waitrose). This left 387 Safeway sites for Morrisons – 56 of these were converted last year with the majority of the rest set to follow this year.

Buying Safeway turned Morrisons into the fourth-largest supermarket chain in the UK. Its market share stood at

15 per cent last January before the takeover. However, Morrisons’ share of the grocery retail market slipped to 13 per cent in the three months to 5 December 2004. Market leader Tesco has a 29 per cent share.

Lunn Poly/Thomson

Lunn Poly was created in 1965 by the merger of Sir Henry Lunn’s

Co-operative Education Tours and Poly Tours, which was founded in 1888 to provide foreign holidays for students of London’s Regent Street Polytechnic. Lunn’s company chartered the first holiday flight in 1931.

Lunn Poly’s owner Thomson Travel Group was bought by German travel giant TUI in 2000. Lunn Poly was rebranded under the Thomson name last December, while Britannia Airways became Thomsonfly. The rationale was that, with pressure from online travel agents, Thomson needed to capitalise on its main brand.

The Thomson chain is now the UK’s largest travel agent, with 800 branches.

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