Magazine article Management Review

Names People Play

Magazine article Management Review

Names People Play

Article excerpt

Companies take their names very seriously. Not only are there more name changes going on than in previous years, but the companies themselves are sweating hard to devise names that make a positive impact. They are sensitive to investor, shareholder and financial analyst sensibilities. And, well they should be. Studies have shown that a name change can have an immediate positive or negative impact on a company's stock price. According to corporate identity consultants Anspach Grossman Portugal (AGP), mergers and acquisitions accounted for 56 percent of the 653 name changes in the first six months of 1992. Elective name changes accounted for 20 percent of all changes.

A name change could involve millions of dollars if, for example, more is at stake than mere letterhead and stock certificate changes. Think of the expensive paint job involved in changing the 1ogo on tankers, oil tanks, refineries, and the like, when "Esso" became "Exxon."

Name changes got a big boost in the early '70s, when Swift & Co., the meatpacker, changed its name to Esmark. "Everybody thought they were crazy," says Joel Portugal, a partner in AGP. "But they were spinning off companies and becoming a holding company. Their change was so successful, that now people call the process 'Esmarking'."

It turns out corporate identity experts themselves have strong likes and dislikes. Alvin H. Schechter, chairman and CEO of The Schechter Group, says he has trouble with coined names. …

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