The no-name trap.

October 1, 2006

J. Walter Thompson has just changed its name to JWT and another famous advertising name gets replaced by meaningless initials.

J. Walter Thompson now goes into the history books along with ]]>

Is nothing sacred? Will Advertising Age change its name to AA? Hopefully not, but you never can tell. Initialitus has infected the world of branding.

In 1981, when Jack Trout and I wrote “Positionin ]]>

Today there are 43. Tomorrow there are likely to be more.

What drives a company to abandon a perfectly good name in favor of meaningless initials? There are two reasons.

One reason is a change in the nature of the marketplace. The J. Walter Thompson name is associated with traditional advertising and the agency obviously wants to broaden into non-traditional media like the Internet.

The second reason is the “shorter is better” argument. In today’s fast-paced world, a long name is a handicap.

In the case of J. Walter Thompson, both reasons are questionable. By using the initials JWT, the agency forever locks itself into its J. Walter Thompson heritage.

It is almost impossible to create a separate perception for a set of initials. Rather, initials tend to remind people of the names they originally stood for.

When consumers see a KFC sign, they tend to think “Kentucky Fried Chicken.”

GE conjures up “General Electric.”

H-P conjures up “Hewlett-Packard.”

IBM conjures up “International Business Machines.”

MTV conjures up “Music television.”

IRS conjures up “Internal Revenue Service.”

FBI conjures up “Federal Bureau of Investigation.”

USA conjures up “United States of America.”

When a consumer sees a set of initials, his or her first reaction is: “What do those initials stand for?” And if they don’t stand for anything, the consumer is unlikely to remember the initials.

If you make your name famous, you can use your initials as a nickname. (Think JFK or FDR.) If your name isn’t famous, using initials alone is almost certain to keep it from being famous.

So Royal Philips Electronics has just selected “NXP” as the name of its newly independent semiconductor company. What does NXP stand for? Nothing, but according to the company’s chief executive, the name communicates “vibrancy and entertainment.”

Wishful thinking, in my opinion.

What about the “shorter is better” argument? It’s true that consumers almost always prefer a shorter brand name to a longer one. Just look at the shelves in a supermarket which feature brands like All, Cheer, Crest, Dawn, Dial, Dove, Heinz, Lay’s, Pam, Pert, Pledge, Post, Ritz, Scope, Silk, Tide and a host of others.

But there’s two kinds of shorter. Visually shorter and verbally shorter. Advertising agencies tend to be visually oriented so, as you might suspect, they tend to emphasize the visual. The JWT name is visually much shorter than the J. Walter Thompson name.

But it’s not verbally shorter. Both are exactly the same length, five syllables.

J-dou-ble-U-T. J-Wal-ter-Thomp-son.

Oddly enough, the verbal length of a brand name is more important than its visual length. That’s because brands are built primarily by word of mouth. The shorter the verbal length, the easier it is for a consumer to pass along the name of the brand to friends, neighbors, relatives.

As a matter of fact, consumers invariably try to shorten brand names to make this pass-along easier. Chevy and Caddy instead of Chevrolet and Cadillac, for example.

In my experience, J. Walter Thompson was never known as “JWT.” It was always called “J. Walter.” (And Doyle Dane Bernbach was never “DDB,” it was always “Doyle Dane.” Likewise Foote, Cone & Belding which was “Foote Cone.”)

Why? Because J. Walter, Doyle Dane and Foote Cone are all verbally shorter than the initials of those agencies.

So should J. Walter Thompson have changed its name to J. Walter? No, not at all. There’s another important principle that many brand builders forget.

Every powerful brand needs two names. A real name and a nickname. Why is this so? Because the use of nicknames help consumers establish closer relationships with the brands they admire.

Notice, for example, that two people who are exceptionally close almost never use their real names when they talk to each other. It’s always “sweetheart” or “honey” or “dearest” or some similar expression.

If your spouse changed his or her real name to “Sweetheart” because that’s the name you usually used, then guess what? You’d have to invent a new nickname.

JWT has just lost its nickname. What do we call the agency now? “J?”

Should McDonald’s change its name to Mickey D’s because many consumers use Mickey D’s as a nickname? Not at all. As a matter of fact, the Mickey D’s nickname is one of the brand’s subtle, but powerful aspects.

Should Harley-Davidson change its name to HOG, which is both its nickname and its new stock ticker symbol? (In a nice, double-use of the nickname, HOG also stands for Harley Owners Group.)

Should Jennifer Lopez change her name to J. Lo?

Should Tom Cruise and Katie Holmes change their names to TomKat?

Federal Express once had a great nickname, FedEx. Now that the company has changed its name to FedEx, what nickname can consumers use? “FE?”

A wide variety of well-loved brands have well-known nicknames which would be destroyed should these brands adopt their nicknames as their real names.

American Express . . . AmEx.

BMW . . . . Beemer.

Budweiser . . . Bud.

Burger King . . . BK.

Coca-Cola . . .  Coke.

Corvette . . . Vette.

Cosmopolitan . . . Cosmo.

Howard Johnson . . . HoJo’s.

Jaguar . . . Jag.

Macintosh . . . Mac.

Marks & Spencer . . . Marks & Sparks.

Stolichnaya . . . Stoli.

Invariably consumers pick nicknames that are verbally shorter than the real brand names. Occasionally they will use a clever nickname that is the same verbal length as the brand name (Mickey D’s, example.) But seldom, if ever, will they use nicknames that are verbally longer.

Would someone please explain to me why Northwest (two syllables) paints its planes with a “NWA” logotype? Does anyone use NWA (five syllables) as a nickname for Northwest? I think not.

Words are more powerful than initials. The best proof is the superiority of acronyms over initials. Radar (radio detecting and ranging.) Laser (light amplification by stimulated emission of radiation.) AIDS (Acquired ImmunoDeficiency Syndrome.)

GAAP (generally accepted accounting principles.)

When given a choice, most everyone prefers words to initials. You could pronounce the initials A.I.D.S., for example, but almost nobody does. Instead, most people just say “aids.”

Why is this? The word “aids” is shorter (one syllable) than the initials (four syllables.)

Notwithstanding these arguments, the initialization of corporate America continues unabated. In February of this year, the $3.8 billion Computer Associates International changed its name to CA, Inc.

CA is a nice nickname, but unfortunately it already has been taken by the state of California.