Just returned from a trip to San Francisco on USAir. I continue to be shocked by how much this airline has just given up on the concept of service. I wrote a blog recently about one flight in which the attendants seemed to be mimicking Southwest. I thought that perhaps USAir was trying to be friendlier and more customer friendly. Sorry to say, I was mistaken. This was a one-time experience due to the individual attendant, not the airline.
On this most recent trip, my wife and I flew 1st class. We did it because we were celebrating our 40th wedding anniversary and wanted a great experience. What a waste of money!! First, the airplane on the flight out was in very bad need of refurbishing internally--seats were torn, the seat in front of us wouldn't stay up, and there was precious little leg room for a 1st class cabin. The flight attendant worked hard to make our experience as pleasurable as possible. On the way back from San Francisco, we were informed that we had two bags too many (one is allowed to check two bags per person free in 1st class). The price quoted was $200 to pay to check two bags. $200 dollars for bags--after paying more than $1500 per ticket for 1st class. Unbelievable!!
Anyone who understands airline pricing models recognizes that the airlines only make money when they fill seats. When an airplane takes off with an empty seat, it is no different than a super market that has broken eggs or spoiled milk. It is wasted inventory. As a result, the airline is willing to price seats at differentiated prices. So, there is tremendous variance amongst the passengers in terms of what each person paid. Most of the 1st class cabin is comprised of people with upgrade coupons, or they have paid about $100 at the last minute to upgrade because there was an empty 1st class seat. Few, if any in the 1st class cabin have paid full fare, as we did. Few corporations are allowing their executives to fly 1st class anymore, so the full fee passengers are few and far between.
Given this background, it was absolutely shocking that USAir wanted to charge us $200 for two extra bags after we paid full 1st class fare. It was not shocking, given how poorly this airline is run, that they would not bend their bag fee policy for full fare passengers. Our fee more than made up the cost of extra bags--the airline got its money.
In addition, this was a 5+-hour flight and there was no entertainment. We weren't even offered headsets to listen to music. Our kids just flew Air Canada across country--an airline that has gotten a lot of flack of late for poor service--and economy class had individual entertainment systems in the seat backs. Yet, USAir offers no entertainment, even in 1st class. The only other airline like that is Southwest, but that is expected and promised--one doesn't pay for bags and the airline has no first class. They make a promise and stick to it. Is USAir trying to be a no-frills airline and high priced fares? That would be an interesting play. Not wise, but interesting.
USAir is a damaged brand with little redeeming value other than a fairly decent safety record. Its planes are old, its attendants do not seem to care, its fees are high, particularly at airports where it has a commanding market share (e.g., Charlotte, Philadelphia, Pittsburgh).
Recently, USAir wanted to merge with United. Continental moved in a did the merger, knocking USAir out. The fact that United went quickly for a different suitor is good demonstration of the poor brand equity of USAir. Now, the question is who wants to merge with USAir, since the airline needs a partner. One analyst suggested JetBlue. I cannot even imagine that JetBlue would want to be tainted with the USAir brand. The only way they would consider a deal is if--a big if--they wanted the routes USAir has, and if JetBlue wanted to become a major airline.
The only way USAir is surviving is because it provides a needed service that right now cannot be duplicated--flying to cities from certain cities that no other airline serves. As other airlines, like Southwest, move in to challenge USAir, they take market share and further damage USAir. Instead of beefing itself up and improving its brand, USAir acts like a company run by accountants or hedge fund managers--cutting costs and with it further eroding perceived value.
Stick a fork in USAir already. The airline is cooked. Please someone put it out of its misery.
Showing posts with label brand. Show all posts
Showing posts with label brand. Show all posts
Thursday, June 17, 2010
Monday, February 22, 2010
Do Ethical Ranking Translate to Sales?
Do companies that are ranked high on ethics get more sales as a result. The answer is yes, but it is a bit more complicated that that. Studies have shown that companies that are ranked highly on reputation do better financially than companies with poor reputations. Ethics and reputation are quite different. Ethics means acting on a "higher order". Reputation means exceeding stakeholder expectations and being distinguished from ones peers and competitors. Reputation can be measure; ethics are much harder to measure and often depend on the perspective of the person doing the assessment.
For example, I have seen a number of so-called ethics rankings that will not include pharmaceutical companies because they engage in animal testing. This is an ideological perspective on ethics. The FDA and other health organizations globally require that drugs be tested on animals and they often specify the animal. It is far better, in my opinion, to test a drug on an animal than on a human before releasing. But, that is not the opinion of PETA and other such organizations. They have a different perspective on what is an what is not ethical.
To me, corporate ethics is the perspective that guides an organization to respect and balance the needs and interests of its multiple stakeholders. It is a facet of reputation, not the same.
Business ethics do translate into more sales, but in an indirect way. People often say that they want to do business with more ethical companies, but it usually means "all things being equal", which they rarely are. Actual behavior is much more difficult to track. Will someone actually not do business with a company that they judge to be unethical? Many people believe that the oil companies are unethical, but they continue to fill their cars with gas. There is no alternative. Some people may hate their local cable companies and think that they are unethical, but they continue to watch TV--once again, there is little choice. When choice becomes greater, we look for reasons to buy and not to buy.
While we know that reputation can translate into greater sales, lowered cost of capital, etc., ethics is a bit more difficult to track. Heinz was the first company to take a position of "dolphin free tuna", requiring that fisherman catching tuna for its Starkist brand not kill dolphins in the process. They were applauded, but there was no increase in tuna sales. Unilver's Dove brand soap created the "Campaign for Inner Beauty" to help talk to young girls whose body image was being shaped by standards of Hollywood and Madison Avenue. They were applauded but the campaign did not increase sales of Dove. The campaigns, however, spoke volumes about the philosophy of business of these brands and increased their value longer-term in the eyes of many.
Sales may be the wrong measure of what companies are looking for. The real measure is perceived value, and that will translate into higher prices, not necessarily more sales. Sales tracks volume; perceived value can move based upon an appeal to a niche market that, if it is a "bell-weather", could increase the overall value of the product or organization. We will see the results in better recruiting, greater support from outside interest groups, retention of top talent, etc.
There is a great and compelling reason for companies to act ethically and to build their reputations. Asking if this will result in direct contribution to sales is a short-term question to a longer-term process. The key, though, is to be ethical, not to brag about it. Once again, we find that if one lives their brand, they will build their reputation.
For example, I have seen a number of so-called ethics rankings that will not include pharmaceutical companies because they engage in animal testing. This is an ideological perspective on ethics. The FDA and other health organizations globally require that drugs be tested on animals and they often specify the animal. It is far better, in my opinion, to test a drug on an animal than on a human before releasing. But, that is not the opinion of PETA and other such organizations. They have a different perspective on what is an what is not ethical.
To me, corporate ethics is the perspective that guides an organization to respect and balance the needs and interests of its multiple stakeholders. It is a facet of reputation, not the same.
Business ethics do translate into more sales, but in an indirect way. People often say that they want to do business with more ethical companies, but it usually means "all things being equal", which they rarely are. Actual behavior is much more difficult to track. Will someone actually not do business with a company that they judge to be unethical? Many people believe that the oil companies are unethical, but they continue to fill their cars with gas. There is no alternative. Some people may hate their local cable companies and think that they are unethical, but they continue to watch TV--once again, there is little choice. When choice becomes greater, we look for reasons to buy and not to buy.
While we know that reputation can translate into greater sales, lowered cost of capital, etc., ethics is a bit more difficult to track. Heinz was the first company to take a position of "dolphin free tuna", requiring that fisherman catching tuna for its Starkist brand not kill dolphins in the process. They were applauded, but there was no increase in tuna sales. Unilver's Dove brand soap created the "Campaign for Inner Beauty" to help talk to young girls whose body image was being shaped by standards of Hollywood and Madison Avenue. They were applauded but the campaign did not increase sales of Dove. The campaigns, however, spoke volumes about the philosophy of business of these brands and increased their value longer-term in the eyes of many.
Sales may be the wrong measure of what companies are looking for. The real measure is perceived value, and that will translate into higher prices, not necessarily more sales. Sales tracks volume; perceived value can move based upon an appeal to a niche market that, if it is a "bell-weather", could increase the overall value of the product or organization. We will see the results in better recruiting, greater support from outside interest groups, retention of top talent, etc.
There is a great and compelling reason for companies to act ethically and to build their reputations. Asking if this will result in direct contribution to sales is a short-term question to a longer-term process. The key, though, is to be ethical, not to brag about it. Once again, we find that if one lives their brand, they will build their reputation.
Wednesday, January 27, 2010
Toyota Recall a Correct Decision
Toyota's decision to stop the sale of all cars affected or potentially affected by the acceleration problem should be applauded. It is an unprecedented move by an automobile manufacturer. In making this decision, Toyota took a short-term financial hit to save its reputation long-term. The decision reminds me of the decision by J&J in 1982 to recall all Tylenol from the market after 7 people died from cyanide-laced Tylenol in the Chicago area.
Toyota has built its reputation on quality and reliability of its cars. Those attributes have been put into question. Toyota's perceived leadership on quality and reliability will be tainted for many and the troubles will be a competitive lift to other car manufacturers. However, what Toyota told the public by its action is that they put safety and reliability over revenues and profits. Their recall may open them to even more litigation since it likely will be interpreted by the courts as being an admission of guilt. However, trust is built by trustworthy behaviors, not by words, and they have demonstrated by their action that they can be trusted.
All of these downsides were obviously weighed by the management team in Tokyo before making this decision. A recall of all affected cars was the first step and that is what most other car companies would have done, but most would have stopped there. Toyota, however, went further, pulling all affected cars from the market and also stopping the rentals of these cars from rental car agencies. By taking this action, Toyota also preempted regulatory withdraw of its cars. Within days they would likely have been forced to pull their cars, which would have been much worse of the company. They chose to get in-front of the crisis.
In the competitive world of auto sales and especially in our tough economic times, Toyota is pulling themselves out of consideration for many car buyers, loosing sales for a long period of time since auto buyers typically do not return for years. That is why anyone who believes in brand management or reputation management should applaud Toyota's action. They took the tough but right decision.
I have been asked whether I believe that they will regain market share after this is behind them. I believe that they have the potential to do that. It will take time because of the car buying cycle--it's years, not days or months like Tylenol. But, consumers now know for sure that Toyota is concerned with the quality of its cars and the safety of its consumers. We know that when those cars come back on the market, they will be engineered to the highest standards. Remember that Southwest Airlines was found to have cracks in its planes that were overlooked by negligent maintenance. It pulled its planes and when it began flying again, the public lined up again. Loyalty rebounded.
I suspect that loyal Toyota customers, those who have been their customers for years, will return. Those who bought a Toyota for the first time might find themselves looking elsewhere. They are what are called "passive loyalists", easily swayed by other offers.
I wish Toyota well. I do not own one of their cars, but I admire them for recognizing the importance of reputation in their long-term corporate health.
Toyota has built its reputation on quality and reliability of its cars. Those attributes have been put into question. Toyota's perceived leadership on quality and reliability will be tainted for many and the troubles will be a competitive lift to other car manufacturers. However, what Toyota told the public by its action is that they put safety and reliability over revenues and profits. Their recall may open them to even more litigation since it likely will be interpreted by the courts as being an admission of guilt. However, trust is built by trustworthy behaviors, not by words, and they have demonstrated by their action that they can be trusted.
All of these downsides were obviously weighed by the management team in Tokyo before making this decision. A recall of all affected cars was the first step and that is what most other car companies would have done, but most would have stopped there. Toyota, however, went further, pulling all affected cars from the market and also stopping the rentals of these cars from rental car agencies. By taking this action, Toyota also preempted regulatory withdraw of its cars. Within days they would likely have been forced to pull their cars, which would have been much worse of the company. They chose to get in-front of the crisis.
In the competitive world of auto sales and especially in our tough economic times, Toyota is pulling themselves out of consideration for many car buyers, loosing sales for a long period of time since auto buyers typically do not return for years. That is why anyone who believes in brand management or reputation management should applaud Toyota's action. They took the tough but right decision.
I have been asked whether I believe that they will regain market share after this is behind them. I believe that they have the potential to do that. It will take time because of the car buying cycle--it's years, not days or months like Tylenol. But, consumers now know for sure that Toyota is concerned with the quality of its cars and the safety of its consumers. We know that when those cars come back on the market, they will be engineered to the highest standards. Remember that Southwest Airlines was found to have cracks in its planes that were overlooked by negligent maintenance. It pulled its planes and when it began flying again, the public lined up again. Loyalty rebounded.
I suspect that loyal Toyota customers, those who have been their customers for years, will return. Those who bought a Toyota for the first time might find themselves looking elsewhere. They are what are called "passive loyalists", easily swayed by other offers.
I wish Toyota well. I do not own one of their cars, but I admire them for recognizing the importance of reputation in their long-term corporate health.
Thursday, December 3, 2009
Tiger is a Actually a Cheetah
So now we know what we all suspected. Tiger was cheating on his wife with several woman. He's human. What a shock. An attractive, rich guy traveling the world gets hit on by women and give in to temptation. Again, what a shock?
So, why are we still waiting for an appearance from Tiger? Why does he continue to believe that he can manage this through his website? Does he really believe that we believe that he is writing all of this and not having his entourage front for him? Maybe it is a shock to him to learn that he is human. He was raised by a father that developed him to be a robot and that has served him well on the golf course. Maybe he can't quite believe that he has human frailties like the rest of us mortals?
While he has helped by coming out and admitting his mistakes, he still has not done what needs to be done, which is to make an appearance and show his emotions. He has to stop trying to make us feel that the media are wrong for doing their jobs in covering this story. Once again, he is not an ordinary person. If he were, this would never have been a story. He is a brand. He has responsibilities beyond himself. As I said before, he needs to take the David Letterman approach. Admit mistakes and tell people that it is now his responsibility to rebuild his relationship with his wife. He can then ask for some privacy to do that. Spare her--she hasn't done anything wrong, nor have the children.
I am still waiting for Tiger to act like the person we all thought and hoped he was.
So, why are we still waiting for an appearance from Tiger? Why does he continue to believe that he can manage this through his website? Does he really believe that we believe that he is writing all of this and not having his entourage front for him? Maybe it is a shock to him to learn that he is human. He was raised by a father that developed him to be a robot and that has served him well on the golf course. Maybe he can't quite believe that he has human frailties like the rest of us mortals?
While he has helped by coming out and admitting his mistakes, he still has not done what needs to be done, which is to make an appearance and show his emotions. He has to stop trying to make us feel that the media are wrong for doing their jobs in covering this story. Once again, he is not an ordinary person. If he were, this would never have been a story. He is a brand. He has responsibilities beyond himself. As I said before, he needs to take the David Letterman approach. Admit mistakes and tell people that it is now his responsibility to rebuild his relationship with his wife. He can then ask for some privacy to do that. Spare her--she hasn't done anything wrong, nor have the children.
I am still waiting for Tiger to act like the person we all thought and hoped he was.
Saturday, November 28, 2009
Live Your Brand; Grow Your Reputation
It seems amazing to me that so many people continue to talk about reputation as if it were something that we could build through communications alone. Reputation is primarily built through behavior, not through communications. We've heard the term "walk the talk". Companies that behave properly build their reputations more effectively than those who talk about it and do little to act appropriately.
Brand is the attributes, associations and symbols that we create that we want to be known for. Reputation is the "vote" by stakeholders that we are distinguished (differentiated in strategy terms) from our peers. How do we get from what we want to be to reputation? It is through our employees--they are the ones who connect the brand to stakeholders.
When we develop a positioning--the words that give our brand life; that explain why we should be favored over another offerings--we need to get employees engaged so that they are both willing and able to live the brand in their daily activities. One good way to do this is to develop an Employee Mantra, a simple, clear message that employees understand is their role in the positioning. It is tough to use the positioning by itself because it is focused on external stakeholders, and we ask way too much when we ask employees to understand how to translate the positioning. But, a good Mantra can do that. Like the concept of mantra in meditation, it is designed to provide focus when the "mind" wanders. So, when many people are telling employees different things, they can come back to their mantra to know what to do.
There is a famous story about someone who visited NASA and saw a janitor sweeping the floor. "What is your job"? the visitor asked. One would expect the answer to be that the person was a janitor. The answer, however was: "I keep this place clean so that we can put a man on the moon".
Consider how we could get all employees to translate their jobs to a final accomplishment that builds value for the organization. "What do I do that adds value?" is a great question for everyone in the organization. When we can find that connection and make it emotional, we have the real ability to engage employees in behaviors that will live the brand and grow reputation.
Brand is the attributes, associations and symbols that we create that we want to be known for. Reputation is the "vote" by stakeholders that we are distinguished (differentiated in strategy terms) from our peers. How do we get from what we want to be to reputation? It is through our employees--they are the ones who connect the brand to stakeholders.
When we develop a positioning--the words that give our brand life; that explain why we should be favored over another offerings--we need to get employees engaged so that they are both willing and able to live the brand in their daily activities. One good way to do this is to develop an Employee Mantra, a simple, clear message that employees understand is their role in the positioning. It is tough to use the positioning by itself because it is focused on external stakeholders, and we ask way too much when we ask employees to understand how to translate the positioning. But, a good Mantra can do that. Like the concept of mantra in meditation, it is designed to provide focus when the "mind" wanders. So, when many people are telling employees different things, they can come back to their mantra to know what to do.
There is a famous story about someone who visited NASA and saw a janitor sweeping the floor. "What is your job"? the visitor asked. One would expect the answer to be that the person was a janitor. The answer, however was: "I keep this place clean so that we can put a man on the moon".
Consider how we could get all employees to translate their jobs to a final accomplishment that builds value for the organization. "What do I do that adds value?" is a great question for everyone in the organization. When we can find that connection and make it emotional, we have the real ability to engage employees in behaviors that will live the brand and grow reputation.
Friday, November 27, 2009
Stop Playing the Price Game
I am in Toronto visiting friends. Yesterday, I had a really interesting discussion with a fellow who imports household goods, spices, and other things. We were talking about value and brand over price. The gist of the discussion was that North Americans have become convinced that the only way to keep or attract new customers is through lowering price. This might bring in customers, but it also undermines the perceived value of the offering and undermines the brand.
The Wal-Mart impact is being felt in every sector of the economy. Many businesses look to Wal-Mart's success and conclude that they cannot succeed without having the lowest price. There are many ways to show value to the customer. Price is just one.
Consider that there is a continuum between high price, high differentiation and low price, commodity. These are the extremes of the continuum, not our only choices. Between these extremes we have many ways to show increased value--customer service, relationships, partnerships, etc.
It is a good thing to cut costs. But, that should be done to allow the firm to provide value in other ways. It should not be done so that price can be lowered. If it is, the margins are squeezed and the entire market become a war of attrition.
Let's consider Southwest Airlines or Porter Airlines (if you are not familiar with Porter, you should fly them to Toronto from one of the cities they fly from in the US--Chicago, Boston, Newark). Both airlines gained efficiencies by having only one type of place and flying only point-to-point. This means that all staff are qualified on all planes and they do not have to deal with hubs. This speeds flight arrivals and departures. But, at the same time, they used these cost efficiencies to create value differentiation--Porter actually pushes carts with free wine and provides food. Southwest does not charge for bags. These are things that drive up perceived value. But, they also do things that other airlines could do for free but do not--they smile, they act like they enjoy and appreciate having you on board. They make the experience enjoyable. This builds perceived value and increased loyalty.
We have to get control for companies back from the accountants and finance folks who think that everything comes down to price and start looking for ways to enhance perceived value. There are so many ways that companies can do it--it will enhance the brand and, if the entire organization is engaged, it also will grow the reputation.
The Wal-Mart impact is being felt in every sector of the economy. Many businesses look to Wal-Mart's success and conclude that they cannot succeed without having the lowest price. There are many ways to show value to the customer. Price is just one.
Consider that there is a continuum between high price, high differentiation and low price, commodity. These are the extremes of the continuum, not our only choices. Between these extremes we have many ways to show increased value--customer service, relationships, partnerships, etc.
It is a good thing to cut costs. But, that should be done to allow the firm to provide value in other ways. It should not be done so that price can be lowered. If it is, the margins are squeezed and the entire market become a war of attrition.
Let's consider Southwest Airlines or Porter Airlines (if you are not familiar with Porter, you should fly them to Toronto from one of the cities they fly from in the US--Chicago, Boston, Newark). Both airlines gained efficiencies by having only one type of place and flying only point-to-point. This means that all staff are qualified on all planes and they do not have to deal with hubs. This speeds flight arrivals and departures. But, at the same time, they used these cost efficiencies to create value differentiation--Porter actually pushes carts with free wine and provides food. Southwest does not charge for bags. These are things that drive up perceived value. But, they also do things that other airlines could do for free but do not--they smile, they act like they enjoy and appreciate having you on board. They make the experience enjoyable. This builds perceived value and increased loyalty.
We have to get control for companies back from the accountants and finance folks who think that everything comes down to price and start looking for ways to enhance perceived value. There are so many ways that companies can do it--it will enhance the brand and, if the entire organization is engaged, it also will grow the reputation.
Tuesday, November 17, 2009
Totes>Isotoner Sets High Standards for Customer Service
It is not often these days that one is totally shocked by a display of high customer service. I purchased a Totes (they use totes, lower case) umbrella last spring. It is guaranteed for life. At some point recently, one of the spokes of the umbrella broke. I followed the instructions I found on line to not take it back to a store, but rather to send it back to the company with $5.00 for return postage. A new or repaired item would then be sent.
Much to my amazement, I received a letter yesterday from one Helen Baur, Consumer Affairs, totes>isotoner. The letter indicated that "under your circumstances, we would certainly not expect you to pay this fee, having had the umbrella for such a short period of time". My $5.00 was enclosed.
Now, I should note that I did not have a receipt for the original purchase, so Totes was simply assuming from the model of my umbrella that I had purchased it recently.
I teach in a business school and we are always talking about customer service, or lack of it, and the return on investment that it brings or looses. totes>isotoner has gone beyond what I would have expected. I am absolutely impressed with their high consumer standards. They deserve my praise and my customer loyalty. I thought I would pass this on to others in hopes that my story will both inspire other companies to adopt similar standards, and for others in the market for umbrellas, gloves and other items by totes>isotoner, to consider totes>isotoner.
Much to my amazement, I received a letter yesterday from one Helen Baur, Consumer Affairs, totes>isotoner. The letter indicated that "under your circumstances, we would certainly not expect you to pay this fee, having had the umbrella for such a short period of time". My $5.00 was enclosed.
Now, I should note that I did not have a receipt for the original purchase, so Totes was simply assuming from the model of my umbrella that I had purchased it recently.
I teach in a business school and we are always talking about customer service, or lack of it, and the return on investment that it brings or looses. totes>isotoner has gone beyond what I would have expected. I am absolutely impressed with their high consumer standards. They deserve my praise and my customer loyalty. I thought I would pass this on to others in hopes that my story will both inspire other companies to adopt similar standards, and for others in the market for umbrellas, gloves and other items by totes>isotoner, to consider totes>isotoner.
Tuesday, September 29, 2009
Challenges for the Newly Merged Pharma Companies
The consolidation in the pharmaceutical industry continues. It is interesting that last year at this time I was teaching a Pharmaceutical Marketing MBA class and said that consolidation was predictable. Most of the students, all mid-level at pharma companies in various disciplines outside of marketing, pushed back that this would not happen. I think it was more of a wish on their part rather than good market observation.
Anyway, the consolidation has been going on and will continue. We likely are moving to what the Boston Consulting Group called the "Market of Three". That is, as an industry matures, consolidation occurs until there are three major broad players, with a group of niche players.
There are huge opportunities awaiting these newly formed companies to enhanced their perceived value with stakeholders. When a company says they will be the "new ..., they are in fact framing expectations for stakeholders that something will be different. That is, there will be new attributes, associations and experiences that were there previously. From a brand and reputation perspective, this is a double-edged sword. On the one-hand, these companies can get out of the starting gate with new positioning, brand and reputation initiatives designed to prove that they are in-fact new. Or, they can simply hope that new means that they will be accretive at some point in their financial performance, which I would argue is insufficient to prove their newness.
I would hope that these companies are looking at how they created value before, individually, and how they will be creating value going forward; that they reidentify for themselves and for others their strategic group with which they compete; that they engage in organizational change efforts to bring the new cultures into alignment (60-70% of mergers fail due to culture clashes); and that they look for ways to enhance their reputation with there key stakeholders.
It will be interesting to see how many of these companies do anything more than simply try to tell people that they are new.
Anyway, the consolidation has been going on and will continue. We likely are moving to what the Boston Consulting Group called the "Market of Three". That is, as an industry matures, consolidation occurs until there are three major broad players, with a group of niche players.
There are huge opportunities awaiting these newly formed companies to enhanced their perceived value with stakeholders. When a company says they will be the "new ..., they are in fact framing expectations for stakeholders that something will be different. That is, there will be new attributes, associations and experiences that were there previously. From a brand and reputation perspective, this is a double-edged sword. On the one-hand, these companies can get out of the starting gate with new positioning, brand and reputation initiatives designed to prove that they are in-fact new. Or, they can simply hope that new means that they will be accretive at some point in their financial performance, which I would argue is insufficient to prove their newness.
I would hope that these companies are looking at how they created value before, individually, and how they will be creating value going forward; that they reidentify for themselves and for others their strategic group with which they compete; that they engage in organizational change efforts to bring the new cultures into alignment (60-70% of mergers fail due to culture clashes); and that they look for ways to enhance their reputation with there key stakeholders.
It will be interesting to see how many of these companies do anything more than simply try to tell people that they are new.
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