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PRO: Rebranding Can Improve Corporate Reputation

Jim Heininger recently shared the PRO perspective on the power of rebranding in a major research summary for CQ Press. The platform is a resource for university libraries and behind a subscription paywall. Find his submission below.

Rebranding can be a jet pack to success. We have seen repeatedly the energizing power that rebranding has for organizations.

To start, rebranding shouldn't be seen as a marketing strategy, but rather an enterprise-wide strategic growth accelerator. Rebranding — the wholesale updating or creation of a new customer promise, name, visual identity and go-to market strategy — is brand-driven business transformation that should create a forward-facing organization able to grasp new opportunities. It's not just changing your logo and color palette. Rebranding is about better expressing differentiation that drives growth.

Author and marketing expert Seth Godin said, “A brand is the set of expectations, memories, stories and relationships that, taken together, account for a consumer's decision to choose one product or service over another.” To rebrand means to start that definition all anew. It means aligning the organization behind a new promise to customers and delivering against it consistently. Rebranding should produce a brand structure that aspirationally and energetically defines you, with a story that works hard in the marketplace. Outcomes should include an engaged employee base delivering a discernably better customer experience and a measurable difference in sales.

We surveyed companies that had recently rebranded to learn why they applied the strategy and their greatest challenges to a successful rebranding process. While there are multiple reasons for rebranding, the study found that creating opportunity for growth is most frequently cited, followed by lost relevancy of the prior brand. Organizations that rebrand overwhelmingly experience improved visibility (75 percent) and product differentiation (69 percent) while 75 percent experience some to moderate improvement in sales.

A University of Nebraska at Omaha study found: “[O]n average, rebranding events are associated with positive stock returns. We observed an average increase of 2.46 percent in stock prices, which is equivalent to an average gain of $31 million in market value of the sample firms. Therefore, we conclude that investors appreciate and reward firms’ rebranding efforts, and that rebranding produces significantly positive changes in firm value. Generally speaking, it is worthwhile to rebrand.” While the Nebraska study identified that rebranding is not for everyone, findings convey that investors reward rebranding when a business is facing competitive attacks as a signal of needed strategy changes.

And the momentum continues. Forrester indicates rebranding is on the rise this year, especially in the B2B (business-to-business) market, due to the surge in merger and acquisition activity as well as the need for companies to reset their promise to customers post-pandemic.


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