Thinking Citizen Blog — “A Rose by Any Other Name Would Smell as Sweet” (Romeo and Juliet, Shakespeare)
Thinking Citizen Blog — Tuesday is Economics, Finance, and Business Day
Today’s Topic: “A rose by any other name would smell as sweet” (Romeo and Juliet, Shakespeare)
Despite the protestations of Romeo, names matter. A lot. Witness the millions of dollars spent on high-priced consultants by corporations looking for a better name. Although feces by any other name would smell as foul, corporations have been spending oodles of money with zillions of alternative uses to find a name change that will presumably help pry billions of dollars from investors to boost their market capitalizations by astronomical multiples of the consultant fees. Today a few examples from the last thirty years. Experts — please chime in. Correct, elaborate, elucidate.
COMMONWEALTH EDISON BECOMES “EXELON,” ARKANSAS POWER AND LIGHT BECOMES “ENTERGY” (1990s)
1. In 1994, Commonwealth Edison of Chicago became “Unicom.” Might be mistaken for a software company and get a higher multiple of earnings, right?
2. In 2000, “Unicom” merged with PECO Energy (formerly Philadelphia Electric) to become Exelon! Even a better name! Sounds like an awesome growth company doesn’t it? Perhaps even a higher multiple!
3. In 1989, Arkansas Power and Light (founded in 1913) morphed into “Entergy” which “powers life.” How sexy is that!
GOOGLE BECOMES ALPHABET
1. Why did Google change its name? To give investors “clarity.” Really? You’ve got to be kidding me.
2. “By creating two specific segments of Google, investors and shareholders could separate the strengths of Google — namely, search and ads — from its riskier endeavors, like self-driving cars. Another reason: Larry Page, then Google’s CEO, wanted to take a backseat in operations in order to focus on his bigger dreams, like the company’s moonshots in health and energy.” Really? Does this make sense to you?
3. How about to “prevent public relations debacles”? Sure. Whatever.
FACEBOOK BECOMES META PLATFORMS INC
1. “US Representative Alexandria Ocasio-Cortez responded in a tweet to Zuckerberg’s announcement about Meta, saying: “Meta as in ‘we are a cancer to democracy metastasizing into a global surveillance and propaganda machine for boosting authoritarian regimes and destroying civil society…for profit!”
2. “Ex-Facebook employee Frances Haugen and whisleblower behind the Facebook Papers responded to the rebranding efforts by expressing doubts about the company’s ability to improve while led by Mark Zuckerberg and urged the CEO to resign.”
3. “In a December 202 interview, SpaceX and Tesla CEO Elon Musk said he could not see a compelling use-case for the VR-driven metaverse, adding: “I don’t see someone strapping a frigging screen to their face all day.”
NB: So what was the official story? That it was done to show that the company was “branching out and linked to more than one product.” Was it really to “distract the public” and “placate investors”? Is this move designed to divert regulatory assaults? Is this claim remotely plausible? Is this a brillant business move” because the metaverse is the future? (See final link)
1. Any consultants out there want to pitch in?
2. Any historians want to comment on other historic re-branding waves?
FOOTNOTE — Altria
1. Remember how the Philip Morris tobacco re-branded itself as Altria.
2. How did that work out?
3. Did the name evoke altruism rather than cancer and transform its image with the public? Really?
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