Risky Rebranding

Radio Shack, long a favorite seller of cables, plugs, adapters, and other electronic sundries, is apparently in the process of rebranding itself as “The Shack,” which sounds to me more like a sleazy bar than a reputable electronics dealer. When I noted this on Facebook, people ranted over some other recent brand conversions, including the SciFi Channel’s switch to SyFy and Gatorade’s That’s G campaign. While it can be a good idea for a business to change its brand, this minor episode reveals how much thought and preparation should go into it.

Branding is a big deal these days because companies appreciate how much impact it has on their business. Understand that a brand is more than just a logo—it’s the total experience that consumers attach to a company. This includes products, packaging, and customer service as well as a host of perceived intangibles, such as product quality, business ethics, and personality. The real risk of losing the battle of perception is a key reason companies spend so much effort and money promoting and protecting their brands (such as by immediately ending sponsorships that might make them look bad by association).

Done well, rebranding can have a significant and lasting impact, improving your company image and communications, and advancing your position in the market. Done poorlyor even just presented poorlyit can become a focus of ridicule or, worse, have negative business repercussions, not the least among your own employees. Years ago I met someone who told me his company had just paid a branding agency a great deal of money to tip their logo slightly and move the company name up and to the right. Even though the rebrand involved much more than that, someone dealing first-hand with company cost-cutting sure couldn’t see the value.

Which brings us back to Radio Shack, and a warning against hoping a rebrand will fix a company’s business problems. Commentaries on the Web suggest that Radio Shack’s move away from the word “radio”—even though it sounds logicalis not what the customer ordered. People blame a misplaced emphasis on cell phone sales, attempts to compete with Best Buy, high prices, and undertrained employees. Many would like to see a return to the Radio Shack (not the products) they knew in the 1980’s—a niche seller of electronics accessories with knowledgeable employees. But as one of my Facebook friends said, “apparently it’s easier to change their name and cross their fingers than to fix their business model.”

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