Academic journal article Academy of Marketing Studies Journal

A Case of Mistaken Identity: Applying Qualitative Research Methods to Assess a Utility Company's Proposed Change in Corporate Identity

Academic journal article Academy of Marketing Studies Journal

A Case of Mistaken Identity: Applying Qualitative Research Methods to Assess a Utility Company's Proposed Change in Corporate Identity

Article excerpt

INTRODUCTION

Evolving deregulation in the U.S. electric utility industry is resulting in well-established regional monopolies being suddenly faced with fierce competition at a national level. Industry experts are predicting "an all-out brawl for the business" (Rosenthal 1996). It is predicted that increased retail competition could result in anywhere from a $50 billion to a $100 billion drop in annual consumer energy spending by the year 2000 (Dar 1996 and Miller 1997). In response to anticipated competition, proactive utilities are focusing on the branding of their products and services. However, as utilities have faced little competition in the past, they are often unsure about how to brand a product that traditionally has been viewed as a commodity. As a utility-employed MBA student in one of the author's classes stated, "An electron is an electron. How can we give that a brand identity?"

Utility branding has begun to take several different forms including: expanding product lines to include other services such as telephone and cable television (Kerber 1997b), emphasizing environmental friendliness (Kerber 1997a), and changing corporate names to attract a more diversified target market (Holden 1997). Utilities with national aspirations are calling on the latter strategy in order to differentiate themselves from "the utility next door" (Holden 1997) and to establish a brand identity that suggests to consumers that is an efficient, state-of-the art energy provider. These newly renamed utilities have discarded titles that include descriptive words such as power, electric or light for sleek one word corporate appellations such as: Entergy Corporation (formerly Middle South Utilities), Cinergy Corporation (a combination of the former PSI Resource Inc. and Cincinnati Gas & Electric), and Primergy Corporation (the proposed merger of Wisconsin Energy Corporation and Northern States Power Corporation). Utilities need to be aware that neither modernizing the corporate name nor relying on the reputation of a 100-year-old name is necessarily the best approach to establishing a marketable brand identity (Seamon 1996). Prior to making branding decisions, utilities must thoroughly understand their markets and their best competitive advantage. Understanding the market can only be accomplished by understanding the customers and the competitive environment.

One western utility that has recently been faced with these decisions is the focus of this paper. This is a diversified energy company that supplies electricity and gas to approximately 430,000 customers and also conducts a variety of nonutility business activities including telecommunications, mining and alternative energy businesses. Influenced by industry trends and a desire to be proactive in a rapidly changing competitive environment, this utility was recently faced with the decision on whether to change its name and if so, to what?

The potential increase and change in location for the utility company's customer base and the addition of multiple product lines made the consideration of corporate identity an important priority for the brand of direction. To help with this undertaking, the utility hired a firm well known for its prior success in creating corporate identities.

This identity firm worked with the utility's corporate communications department and corporate executives to create a list of names that might better reflect the growth and diversity of the organization and the changes within the industry. The specialists suggested names they felt met the criteria of being: (1) brief, (2) pronounceable, (3) tied to the industry, and (4) possessing good semantic characteristics.

Although the identity specialists had a strong preference for one name, they created a list of alternative names for the corporate executives to consider: AURORA; DYNACORP; DYNAMONT; ENERCORP; ENERMONT; ENERTEL; ENMONT; ENTANA; ENTERRA; MERITOR; MONTERA; STARMONT; SUMMIT; VECTREN. …

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