Sometime ago, in the products’ era( through the 50s ,the name of a company used to say all about it. This was owed to the fact that every company specialized on a certain types of products. But the things evolved and the technologic process brought in scene the conglomerate company which is not focused on a certain domain. It can activate in any domain, fact that allows it to have always strong increases of capital. A illustrative example is Procter&Gamble: it activates in the domain of detergents, skin care, toothpastes, shampoos, products for babies, products for shaving etc. Unilever detain brands in the following domains: alimentary, skin care, perfume, spices, detergents etc. Some don’t like the conglomerate companies, others think that should been kept the same old order. The truth is that if this conglomerate companies wouldn’t existed we would enjoy a semi-monopoly context. Even when the conglomerate extends through affiliation (how happened when Gillette was purchased by P&G), they provide the necessary budgets to maintain the concurrence.

On this context we find two strategies, which stay at the base of corporations extension: the developing at a intern level or the affiliation. So, we can distinguish two strategies for choosing the names. The corporations pride dictates usually that the name of intern developed products to have in containing the name of the mother company. This thing is not valid when the company develops the products line through affiliation. Going over all these, would be good that in the naming process to bear in mind the Charles Linderbergh syndrome.

If you succeed to get first in the mind of the potential consumer, any name has chances to succeed. If you don’t succeed to get first in the mind of the potential consumer, then you are a candidate with big chances to fail. The life typical cycle of a brand starts from an entrepreneur who have a idea. If this idea has success, we can assure the brand will be took over by a conglomerate only in two cases: the death and fees.

A new product needs a new brand: it’s a mistake that for a new product to bound its existence by an already known product. The reason is as obvious and as real it can be. An already well known product became known because it represents something, occupying already a position in the consumer mind. A well known name occupies the first position in the well defined top of choices of a regular consumer. If we change the context and the range, we change and the top. So, we need a new name, which to go up on the first step of options.

It’s very hard to combat the primary impulse of choosing a consecrated name because it’s very easy to step in the trap of the idea conform to the target audience will accept easier the new product if we give it the already consecrated name. But the history destroyed this illusion: Xerox spent almost a thousand millions dollars to acquire the Scientific Data Systems, a profitable computer producer with a appropriate name. The next step made by Xerox was to change the name in Xerox Data Systems, conform to the theory that its mystical notoriety will surely help. But the mistake was fatal: Xerox mean copier, not computer (if you will ask for a Xerox copy ,nobody will bring you a CD with data or a central unit) and conform to the rocker principle ,in the moment which a name represent two different products when one goes up the other goes down.

In this cases, the building of a new name for a new product is a wise step, mostly if you know that the anonymity is a strong resource: “The publicity is just like eating”( says Al Ries and Jack Trout). Nothing is more appropriate to satisfy the appetite than a hearty meal. So, nothing can bring to the dramatic decrease of the capital image than a story on the first page of a national publication. We must not forget that we don’t make publicity for the sake of it, and we don’t communicate for the sake of communication: we do it because we want to acquire a strong position in the mind of consumer.
We don’t must to intoxicate it, but we must create the premises of capital accumulation.

The line extending conditions (borrowing of a consecrated brand name ,usually of the new product’s mother company)are plenty and they are bound by level of the competitors which you have; and by the sales volume which (if is a lower one); if you don’t have concurrence ;if you don’t really wish to conquer a position in the mind of the potential consumer; if you don’t make publicity

Here are the rules of the game:

1.    Forecasted Volume. The potential winners should not bear the house name. The products which registry a small sales volume should in stead to bear the producer’s name.

2.    Concurrence. Then when doesn’t exist any concurrence, it is preferred that the brand to not bear the producer name. When the concurrence is high  the house name is recommended.

3.    The sustaining through publicity. Using the house name in the case of the brands that benefit of a considerable budged isn’t recommended. Just the a brand with low budget should benefit of this name.

4.    Meaning. The house name isn’t indicated to products which represent a technological progress or an important discovery.

5.    Distribution Channels. The house name should not appear on those products which are sold in various locations. It is recommended the using of the house name in the case of the products commercialized through authorized agents.

Ciprian Dron
Manager Media Factory