June 7, 2006
Brand Naming: How to Make 50,000 People Hate You
Customers in central Ohio are not happy with Federated Department Stores decision to change the name of its recently-acquired Lazarus retail store chain to Macy’s.
Over the last year these stores experienced a customer visit drop of 4.5%, which means that 50,000 people stayed away in that region alone. The drop was worse than any the stores had experienced in the last five years under the Lazarus brand name.
Well, I hate to say I “told you so” but in this case, I did. Actually, my colleague Diane Prange did. Diane posted a grief stricken blog about the demise of the Dayton’s and Marshall Field’s names in September of last year when these great brands were Macyed.
And in January of this year I reported that people in Chicago reacted to the Macy-ization of their Marshall Field’s stores as if they “had been ordered to start putting ketchup on [their] hot dogs."
But Federated just plows right on, and 50,000 customers in Central Ohio have expressed their disapproval with losing the regionally beloved, 154-year old Lazarus brand name by simply staying away.
On May 29, the Chicago Tribune asked me about the risks of changing a company name.
One of my thoughts was that the decision to replace a regional brand with a national one (or, in Macy’s case, one that is being turned into a national brand after decades of being associated with New York City) was the threat of “management ego”, where managers of the national name believe it can be stretched farther than customers will allow.
Management can all too often see their brand naming strategy differently than their customers do. Even a cursory amount of brand name research – or a perusal of the blogosphere – would have indicated to Federated that changing the Lazarus name would be courting disaster.
That goes doubly so for the Marshall Field’s brand.
See what these bloggers have to say about the Lazarus acquisition:
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