Ever wondered why companies assassinate their logos and replace them every once in a while? Among the more recent examples are the new logos for Starbucks and Airtel.
Are people going to drink more coffee because the Starbucks logo has changed, or talk more? Why then would companies spend millions on making these cosmetic changes in color, type, style, baseline every once in a while? How is this change to affect consumer behaviour, if it does at all?
Your first instinct is to think that it is one more of those esoteric things that marketing busybodies like to do and strictly not to be taken seriously. Yet look at the importance given by brands to this exercise and the money poured into it — is it disproportionate to the value it seems to generate?
I recently read Capt. Gopinath’s book where he writes about Vijay Mallya spending a big fat sum on changing the Deccan colours to Kingfisher colours after he acquired the company. Given that he was acquiring Deccan, which was a low cost airline, precisely because it was unlike his own Kingfisher Air, why exactly did he spend the money to make Deccan look like Kingfisher and also call it Kingfisher Red? Certainly a bit strange, you may have wondered.
However, not all changes are so opaque, and some of the reasons can be pretty weighty —there are deep strategic reasons why CEO after CEO succumbs to the charms of the new livery. For one, the new identity reflects the new reality of the company. Starbucks wants to get into other businesses but does not want to be hindered by the perception that it is only a coffee company, even though that is what it is best known for today and that is its core strength. The idea is that the company will slowly transform itself over time and become much more than a ‘café’ company and 10 years from now, will stand for many other products and services.
The reason for taking the risk of change is as much internal as external. The company is signalling to its different stakeholders — investors, employees, vendors, customers — on what its intentions are and where it is going. Okay, but can this be done without giving the logo a haircut? I guess it can be done, but then a logo change is such a convenient device.
Another reason why the logo gets a haircut is that the company wants to connect better with the new, ever-changing customer. This is not always apparent to the customer when the change is made by a brand — indeed, it appears silly to fix something that is not apparently broken. “What’s in” is always changing and what was perfectly in tune one year may get dated the next.
This is where marketers have to take their chances given that their task is to keep the existing customer happy and the future customers within range. Airtel may fall into this bucket with its emphasis shifting from functional issues of coverage to a closer connect with the customer.
The company may need a common identity for all its brands, so that they get the benefit of the corporate umbrella. This is based on the assumption that the company’s reputation is important to customers when it comes to making a purchase. The Tata group, for instance, modified its logo when Ratan Tata wanted to bring his disparate companies together bound by the same ambitions and values. The new logo represented that drive. Given what the Tata name means to the end users, it was an idea that probably worked well for its brands.
Also important, the brand may want to escape its existing baggage. The first instinct of a marketer with a declining brand is to quickly change the logo and launch a new campaign. The idea is reinvention. Air India and Indian Airlines have chopped and changed their identity many times, all to no avail. Identity change works only if it truly reflects the underlying changes which make the customers re-evaluate a brand.
That apart, this logo change keeps marketing people busy trying to answer the question: why are you changing your logo again?
The writer is CEO, RainMan, a marketing analytics consultancy