May 8, 2014: What's in a name?
At the moment, my partner and I are trailing through websites and books searching for a name for our baby daughter, who will arrive in May. We have seen scores of lists, and can (if you kindly ask us) recite the most popular baby names in Europe for the last three years. Whilst it has been hard work, we feel we have come somewhat closer to our target of finding a short, modern, distinctive and memorable name. We have a shortlist of suitable names, which has been intuitively constructed based on our joint sense of how a name sounds and what it evokes to us, whether it is common (which is a negative in our case), whether it can be pronounced in various languages, and generally how distinctive and memorable the name appears to be. We also seem to veer towards names that are two syllables short and hail from the Northern parts of Europe.
We are no doubt investing a lot of time in this, and you may (quite reasonably) ask whether it really matters or indeed will pay off in the end. Presumably, as soon as our little one is born, we will associate whatever name we have given her with who she is as a person, and assimilate the two into a single image. In turn, the name may in itself not carry that much meaning anymore; instead, it has become a signifier of whatever qualities we associate with the individual person carrying the name. This argument is actually one that has often, albeit implicitly, been made in the context of corporate names; corporations that are known by an acronym (NEC, BASF), symbolic label (Starbucks, Nike) or family name (Heineken, Philips) are simply identifying labels for whatever image we have of that corporation as investors, customers, or employees. Indeed, the entire academic literature on corporate reputation assumes that based on interactions with corporations we form quite detailed images which we use as a basis for judging whether we would like to do business with a certain corporation.
Reputation is not surprisingly the baseline for communicators in many corporations, who hardly ever think about the corporation’s name, other than that it simply exists. But do they then ignore naming practices at their peril?
Mary-Ann Glynn and Rikki Abzug wrote a wonderful paper a few years back on how corporate names have changed over time. They highlight how corporate names have over time changed from rich, descriptive and lengthy names (The Shell Transport and Trading Company) to more brief and concise names (Shell, GE). Besides changes in syntax, the content of names also changed. There was a spell of more abstract and symbolic names in the mid-20th century, and then a return to more familiar product, brand and descriptive labels at the close of the 20th century. In recent years names have also become longer again with three-part names being quite common and with a blossoming of names that include the “.com”, “.org” or “.net” affix. In their paper, Mary-Ann and Rikki were primarily interested in what drove these swings of the pendulum, and why certain types of names became more or less fashionable at certain points in history. A different question would be to ask whether in terms of content and syntax the current taste for longer and descriptive names pays off, or whether in fact it negatively affects the performance of a corporation.
In terms of syntax, a recent study by Clifton Green and Russel Jame in fact shows the opposite: companies with short, simple names attract more shareholders, generate greater amounts of stock trading, and perform better on certain financial measures than companies with longer and harder-to-process names. They demonstrate the direct effect of reducing the length of a corporate name by 1 word, which in their study led to a 2.53% increase in market-to-book ratio (roughly equivalent to $3.75 million in added market value).
What is nice about this study is that Green and Jame have three different measures of name “fluency”, which provide yardsticks for judging how likely it is that the name will register with investors. The first measure is simply the length of the name, with names with lesser words being easier to process and remember. The second measure is the pronouncability of the name, with some names scoring higher on the degree to which they are seen as proper English and easier to pronounce. The third measure is word familiarity, which suggests that words that appear in the English dictionary are more likely to be familiar and recognizable on average compared to invented words or created expressions.
The latter measure in my view also hints that symbolic names may fare better than descriptive names or names that combine descriptive labels. Think for example of how in the 1990s Orange, as a late entrant to the market, was able to gain market share against the likes of Deutsche Telecom, BT Cellnet or Vodafone. A key part of its success may have been its crisp, symbolic name which customers judged as friendly, extrovert, modern and powerful, compared to the rather long and more descriptive names in the market. Similarly, a brand name such as Apple is often judged as spirited, friendly and modern. It is also as a word already intimately familiar to people, compared to more contrived expressions such as Samsung, Lenovo or Sony that are a combination and contraction of other words – and thus not directly familiar or memorable for that matter.
The syntax and content of names may according to this research matter more than we often think. If the fluency of a name is indeed a measure of success, perhaps by the same token my partner and I should perhaps settle on a short, two-syllable name for our daughter that is distinct but also familiar and memorable. Who knows what it may bring her in life.
Green, T.C., and Jame, R. (2013), Company name fluency, investor recognition and firm value, Journal of Financial Economics, 109, 813-834.
A call to all corporate communicators out there!
The marketing and communication industry is booming and buzzing with ideas and new developments. The economic downturn may have tempered the mood a little bit, but the industry is thriving again. Social media, creative solutions, new practices and the demand for the services of communicators makes this in fact one of the most exciting times to be in the field. But positives aside, the job of a communicator has also become a lot more complex. Staying on top of the developments in a fast-changing industry has never been harder and is indeed a full-time job!
With this blog, my aim is to provide a helping hand to communication professionals (so that they can focus on their real jobs), and students interested in moving into the profession. The aspiration I have for this blog is to give you insights on the topics that matter, move your knowledge and understanding forward, one step at a time, and in the process also entertain you a little bit. Other websites and blogs may focus on the industry at large and cover industry-wide trends. With this blog, the aim is to go for depth rather than breadth, and to provide golden nuggets of insights rather than simply reporting facts and figures about the industry.
Every few weeks, I will try and approach the topics, cases and campaigns in our field somewhat differently in order to foster greater insight. This means that I will ask different (or better) questions about standard topics such as reputation management or evaluation, will try and dig up the stories behind the successful (or less successful) cases and campaigns, or will bring in perspectives and insights from other specialties and fields, all in an effort to advance and deepen our understanding of corporate communication. This kind of approach is one that I previously took in writing my books on corporate communication, as a way of bridging between academia and practice and advancing the knowledge base on corporate communication. I hope to bring the same approach to an on-line environment, where it will be much easier to explore and test out ideas in an interactive and collective manner to move the discussion – and indeed our thinking – forward.
I hope you find the postings interesting and useful, and feel free to post questions or comments. I may not be able to answer within the hour (!), but I can promise a conversation which I am sure will be enriching and beneficial to us both.
Wednesday, 18 March 2015
This logic goes something like this. In the 1990s, corporations increasingly started to recognize the value of corporate communication and particularly its strategic role in building and maintaining strong reputations – reputations that have a direct cash value, in that various stakeholders would prefer to do business with a reputable organization, and choose it over its competitors. Reflecting this recognition, new terminology and models emerged that allowed corporations to “manage” these strategically important reputations. Better metrics and positioning mantras came in to help communicators in this, and so as to ensure that their corporations would continue to thrive and prosper.
The key downside of this positioning thinking was that that at times it reinforced an assumption that the minds of stakeholders can in a sense be managed, and even controlled. Models of reputation management often linked corporate messages to direct outcomes in terms of awareness, attitude or broader reputational change on the part of stakeholders. The assumption was, in other words, that corporate communicators can strategically plan and design their messaging in order to in effect ‘take up’ a reputational ‘position’ in the minds of stakeholders. This implies a somewhat linear model of communication that assumes a relatively straightforward process of sending and receiving messages, where any outcomes are already largely predetermined or given. It also neglects stakeholders as active agents, who instead are cast as passive pawns in the skillful hands of a communicator.
This thinking has to some extent been overtaken by current events. Stakeholders have in recent years become much more active in voicing their expectations towards organizations and empowered by new technologies have also started to expect more interactive and dialogue based forms of communication. This in turn has led to some in the industry proclaiming that the old models of corporate communication are obsolete or ‘dead’, and that we are seeing a wholesome change towards interactive models of communication. A recent Harvard Business School book for example proclaims the virtues of interactive, conversational forms of corporate communication as in effect replacing “the traditional one-way structure of corporate communication with a dynamic process in which leaders talk with employees and not just to them” (Groysberg & Slind, 2012).
It is no doubt true that more interactive forms of communication are enabled by new technologies and social media (in comparison to broadcast media) and such forms of communication are also increasingly expected by stakeholders. But proclaiming that there is a wholesome paradigm shift may be a rushed judgment, or at least too early to tell. Others in the industry have taken a more moderate view in suggesting that what we are seeing is a gradual change in that individual stakeholders can now share experiences, opinions and ideas about organizations, and organize for action, at scale. This offers challenges but also opportunities to organizations in terms of word-of-mouth and peer-to-peer influence when individuals self-organize and may become advocates for the organization. In other words, whilst the mechanics in a sense might have changed the overriding principle is to some extent still the same – that is, when individuals hold an organization in esteem, value its reputation, and decide to buy from, work for, invest in or otherwise decide in favor of the organization, they are more likely to become genuine advocates and supporters.
Yet, in recent weeks, I have also started to reflect on my own message to my students. The direct reason is some research I am doing for Fairphone, a social enterprise that aims to develop the world’s first fair and sustainable smart phone (http://www.fairphone.com/). The people from Fairphone are doing something incredibly admirable, in having us all think about how we consume and that we should in fact have higher standards in relation to our consumption of common technological products such as smart phones. What is more they bring their message to the world exclusively through social media (Facebook and twitter), backed up with some old-fashioned press work. This makes them an interesting case of the new model of corporate communication, although obviously they are not a corporate organization but a social enterprise.
To cut a long story short, the exclusive reliance on social media may determine who they will reach with their message. Their own research shows that most of their captive audience involves 40 year old white males, with a relatively high disposable income, highly educated and with a strong political awareness (which apart from income includes me!). There is obviously an element here that social networking dynamics, in terms of how their message gets disseminated, may as much reflect social and economic ties, as that it really forges new ones. In other words, networking dynamics through Facebook and twitter and the community that Fairphone has built around it may help them cement and solidify connections with their buyers and followers, but it may be a lot harder for Fairphone to use social media to move beyond this captive audience and build new relationships, particularly with another demographic.
Whilst this does not suggest necessarily that another strategy would be better for Fairphone, it does lead me to reflect on the value of traditional broadcast media such as advertising, events or promotions. Their beauty lies in exposure and reach that can cut across different segments of a market or of society. Granted, such reach often comes with a lot of waste and spillage (in reaching the wrong people or people who are not swayed by the message), but it seems to me that whilst industry gurus and analysts might say that the “old” ways of corporate communication are “dead”, traditional approaches and broadcast media may continue to have a place, and indeed live on, but perhaps in a slightly different way and alongside social media.
Groysberg, Boris and Slind, Michael (2012), Talk, Inc.: How Trusted Leaders Use Conversation to Power their Organizations. Boston, MA: Harvard Business School Press.