Bell Atlantic Mobile, Vodafone AirTouch plc and PrimeCo Personal Communications L.P. had a problem when they were going to merge their U.S. wireless assets into a single company. How do you combine three company names, each with strong regional appeal, into a single entity for nationwide consumption?
“Nobody wants to give up their brand name and image,” said Elliot Hamilton, a telecom analyst for The Strategis Group. “But branding is the main thing now. Companies are getting rid of regional company names and are going with generic international names thinking ahead to future expansion. It’s all about the name.”
The new name had to roll off the tongue smoothly, yet connect with what the company was providing.
What began with 8,500 potential names was whittled down, with a little help from some marketing experts and a Latin dictionary, to Verizon-a somewhat anonymous name, combining “veritas,” the Latin word for truth, and horizon, for the nation’s newest wireless carrier.
While it is still early in Verizon’s history, if you mention the name to the person on the street, you’ll be lucky if you only get an “Excuse me?”
While that response might worry a new business, Verizon Wireless feels that with the right marketing campaign, provided by Bozell New York, and the right backing-roughly $300 million in advertising-Verizon will become a recognized moniker.
“We have had very positive feedback from current and new customers to our new corporate image,” noted Andrea Linskey, spokeswoman for Verizon Wireless.
When it comes to brand recognition, it’s all about the name. When someone says Nike, do people think of the winged Greek goddess of victory, or the all-powerful swoosh that adorns anything athletic?
According to Corporate Branding L.L.C., a global brand strategy and communications firm, AT&T Corp. and Sprint Corp. were both in the top five in its latest rankings of telecommunications company name recognition, while Bell Atlantic led Verizon’s trio at seventh. Even Lucent Technologies Inc., a fairly new name, ranked sixth in the company’s 1998 survey.
But what about service?
Some analysts feel that the wireless market is too caught up in names and not enough emphasis is placed on service.
“It’s interesting, there is so much competition in the market that most companies are using a name or pricing as their main advantage,” said Dr. Judy Reed Smith, an analyst with Atlantic-ACM Research. “No one is branding themselves as the good quality choice in the market. Now more money is spent on marketing and less is being spent on the infrastructure, the towers and antennas to provide a quality product.”
Another company in the midst of forging a new brand image is Motient Corp., formerly American Mobile Satellite Corp., a company focused on satellite communications. With the satellite business in a bit of a quandary recently, the company has turned its focus to the land-based communications services it recently acquired. The company noted that the new name conveyed a sense of motion, intelligence and information, all important factors in how it wanted to provide service.
Instead of trying to reposition its old name in a new market, AMSC took the bold step of starting from scratch with a new name and new corporate branding.
“You want to select something that people will remember and connect with what you provide,” said Brian Nimmo, vice president of marketing for Motient. “It is a risk to change your name, but we felt we had the right reasons to do it.”
What the industry is finding is that a well-known name is useless if the product behind the name is flawed, leaving consumers to find a provider that is right for them.
The ability to provide a quality product is wrapped up with one of the major hurdles to a stable customer base in the wireless industry-customer churn.
Early proponents of personal communications services touted its consumer-friendly nature. With no contract binding a consumer to a service plan or provider, companies would be forced to provide more than great advertising campaigns to keep customers. While customer churn might be high at the outset, the need to keep subscribers would force companies to provide quality service and thus reduce customer turnover.
But that strategy has changed as many PCS providers today either require contracts or lure consumers with incentives if they choose to sign on the dotted line.
“Wall Street is driving the market,” noted Hunt Eggelston, president and chief executive officer for Technology Trends. “Every consumer increases the value of the company on Wall Street, but it’s a pricing-driven market. It’s all about acquisition and churn now.
“PCS operators had the opportunity to redefine the wireless field,” Eggelston continued. “No one at the senior management level has the fortitude to buck the trend from acquisition and pricing to quality service and customer appreciation.”
Charles Mahla with Econ One, a wireless research company that tracks pricing trends in the industry, noted the lack of standardized technology in the U.S. wireless market is what tethers a subscriber to a provider and is what should concern consumers.
“When you sign up for AT&T service you have a [Time Division Multiple Access] phone. If you want to switch to Sprint, you have to have a [Code Division Multiple Access] phone. The cost of buying a new phone is the prohibitive factor in changing providers.”
While Sprint PCS and AT&T Wireless Services Inc. have predetermined reputations linked to their parent company’s name, Verizon is trying to learn from past mistakes and brand itself as the company trying to fulfill the potential of a consumer-friendly PCS service.
“This has been a very different experience,” said Steve Hardwick with Bozell New York. “We had the chance to analyze the category of the wireless industry and question everything that has happened in the past. It is a great opportunity to step back and position a company not to a geographic location, but to an idea of what a wireless company should be.”
While a properly branded company is important in the market, even the experts know a name is not everything.
A spokesman for Bozell acknowledged that when they began the campaign for Verizon, employees did not even know the full name of the company. They only knew it started with a “v” and ended with an “n.”
