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The Pitfalls of A Re-Brand: Why It Can Be Dangerous to Change Names

By Jerry Bridge-Butler, Baron Warren Redfern

 

Twitter’s sudden re-brand to X has highlighted some of the issues surrounding switching to a new trade mark. There are legal costs and risks associated with the new trade mark applications needed to rebuild your legal rights from scratch. Re-branding can also play havoc with your reputation and customer loyalty. The substitution of an established brand with a completely unknown new name risks alienating and confusing consumers. 

Contents

 

1. Challenges and Considerations for New Brands

2. Possible Negative Impact of Re-branding

3. Why Re-brand?

4. Conclusion

1. Challenges and Considerations for New Brands 

 

In the UK and the EU the trade mark application system is favourable to applicants, because the existence of earlier identical or similar registrations is not an automatic barrier. It is up to the owners of those earlier rights to oppose your application, which they only do a fraction of the time. This means that anyone re-branding to a new name may face fewer challenges. However, there are still issues with inherent registrability of any proposed new branding, and uncertainty over whether earlier rights owners will oppose or not. It’s a big risk to take.

 

With Elon Musk’s new X trade mark for example there may be an inherent problem with trying to seek rights to a single letter mark. While it is certainly possible to obtain protection for a logo version of the letter X, this might not protect against others using a different X logo to sell similar goods and services. When it comes to trying to protect a single letter in any format, as something like the high-profile social media site formerly known as Twitter would need to do to properly protect itself, there might be problems. UK and EU examiners may well reject an application to protect a single letter mark if that letter could be used descriptively in the context of the goods or services. There are also hundreds of existing registrations for X logos in the UK and the EU, and the owners might object.  

 

These kinds of issues arise with any proposed new trade mark application, and need to be carefully considered by your trade mark attorney before proceeding with any application, be that in the UK, the EU or anywhere else. These are considerations any re-brand has to take into account, and any company considering a switch to a new name will need to be very confident that the trade mark registration process will be successful in all the necessary jurisdictions before publicly announcing the change. It may even be prudent to secure trade mark protection prior to any switch, which will add considerable delays to the process.

2. Possible Negative Impact of Re-branding

 

A well-known and established brand name works to drive a business forward, because customers know it, remember it, recommend it and enjoy interacting with it. Twitter for example was one of the most famous brand names in the world, and had an enormous global following. Therefore, the biggest problem with re-branding is the risk of losing existing customers. Some might not find out about the change and simply stop buying your products or using your services. This is not going to happen with Twitter / X due to the very high profile nature of the switch. However, the vast majority of businesses do not attract the same level of press coverage as the world’s richest man. Check how to register a trademark in the UK. 

 

Some customers might react negatively to the new name and choose to shop elsewhere. The whole point of branding is to build a reputation with your customers and to create something they enjoy interacting with. If you mess with the formula then you risk alienating your customers. Branding experts spend a great deal of time evaluating the target customer for a product, considering their sex, age, wealth, tastes and so on, and then focusing the branding accordingly. With something like the Twitter brand, its core characteristics which resonate with its users are completely different to the brand X. As a trade mark, Twitter is friendly, fun, engaging, natural and so on. X is stark, abrupt, elusive and kind of meaningless. It may appeal to some, but probably not to those who liked the Twitter brand. The re-brand to X may have been quite damaging in this sense. Anyone considering a re-brand has to take this into consideration and ensure that the new trade mark at least equals the qualities and characteristics of the old one, or better improves upon them.

3. Why Re-brand? 

 

Given all these issues, the obvious question is why do it at all? There are many legitimate reasons to re-brand, the most obvious being to rationalise products across the world. Those of a certain age will remember that in the UK we had Marathon chocolate bars and Opal Fruit sweets, which were re-branded to Snickers and Starburst respectively to bring them into line with their global equivalents. In other cases brands have been changed, or not even been adopted in the first place due to issues with the wording in a local language. An innocent concocted word in English can have an unfortunate unanticipated meaning in another language. There is an urban myth that General Motors did not sell Nova branded cars in Spanish speaking countries because Nova can be translated as “doesn’t go”. This may or may not be true, but there is certainly a potentially risible element to that trade mark in Spanish which it might have been wise to avoid.

 

The rebrand from Twitter to X was apparently at the whim of one man, and sees the social media site take on a very different identity at odds with its existing reputation. These are not established legitimate reasons for a re-brand, but it is ultimately something the owner of a company has the full right to do. Elon Musk may have wanted to publicly confirm his control of Twitter by changing its name to X, which is ultimately a choice driven by ego rather than commercial sense. 

4. Conclusion

 

The abrupt and illogical re-branding of very well known trade marks is extremely rare, mainly due to the inherent risks associated with alienating or upsetting your hard-earned customer base. Twitter’s re-brand to X will likely turn out to be the most famous rebrand in history, and it remains to be seen if it was the most destructive or the most successful.

 

***


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