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Why AOL Rebranding process may not succeed?

Corporate re-branding is sometimes seen as an inevitable exercise while it appears to be a normal practice for global trendsetters moving away or making alterations to their brands. AOL, a longer version of American Online is an American company that provides internet services and social media networking. The internet company has announced its ongoing process of re-branding itself. AOL will spin-off from Time Warner which has been operating it since the year 2000. The merger between AOL and Time Warner, was a destined ill-fated journey on account of bad advisory. Finally, AOL shares will start trading independently from early December 2009 in NYSE.

Aol. New Corporate Logos

Aol. New Corporate Logos

Trading as a separate identity called for a new corporate identity to help revive the company’s tail spin journey. As a part of the re-branding process, its brand, ‘AOL’ will now be symbolized as ‘Aol.’ with an essential dot in the end. A view master, a high heeled shoe and a kissing couple are but few background features that are set to be replaced with some other weird backgrounds like, a gold fish, some four abstract scrawls and an obscene hand gesture. The logos were designed by Wolff Olins, the agency that came up with the logo of London 2012 Olympic Games.

Commenting on the Re-branding process, Tim Armstrong, the chairman and chief executive of AOL, said the branding was “uniquely dynamic”, while his marketing team added: “The identity … is a platform for expression and creativity reflecting the content, products and services Aol offers.” Yes, we at Webalue.com, agree to some extent but there are larger issues that ought to be attended. I formed three easy interconnected steps for Aol. To follow,

Step 1. Global Brand: Let’s face it. We all know AOL has been trying to establish itself as a global brand. The company has yet failed to shed off, ‘American Online’ as a spot on alternative to ‘AOL’. Non-U.S countries have thus not proved to be as profitable to the company.

Step 2. Being Global, Acting Local: AOL will need to kick off major campaigns, to integrate its brand within foreign cultures. Until the day, these cultures (or countries) adopt AOL into their lives, this company aint going anywhere. In emerging countries like India, where Internet usage has been achieving record growth year-on-year, AOL has a great opportunity. But a major chunk of the market would rather opt for Yahoo or Rediff.com (an Indian portal). AOL is still largely perceived to be American Online, which straight away disassociates non-US consumers.

Step 3. Cultural Dimensions: (This one’s funny) How many times a year do we come across companies committing cultural blunders. Some brand names sound offensive in some countries, while other logos find themselves emitting wrong gestures and signals. Well, here we go again. ‘AOL’ (oops.. or should I say, ‘Aol.’) is all set to be a classic cultural blunder in ITALY. One of their new logo background, has a rock-concert-like hand gesture (See in the Image above) which in Italy indicates a man whose wife has been unfaithful. (Gulp…!!!) Hope Aol(dot) addresses this before launch in Italy.

Apart from these 3 steps, there is another concern that I feel is worth a review. The company recently announced a major lay-off of over 1/3 workforce accounting to cost-cutting measures. This could have well been a gist of actions taken during the AOL-Time Warner’s bad divorce. But, it might have left a bad scar on the retained employees of Aol-dot. As a new company, establishing new and some changed brand values, it is important for the management and the employees to bond together and work as team. Cost-cutting may have been essential, but the timing could have well been wrong. On the flip-side, though it is also possible that the management has foreseen this internal branding risk and would have wanted to leave all negativity with AOL while starting afresh with Aol-dot.

We’ll keep a watch on ‘Aol.’, and keep you updated. So, do we think this company is all-set to take up new highs? Well… uhhh.. Nope not yet. Unless ofcourse if it looks up into addressing the above mentioned 3 steps in one way or the other.

Update (11th December’ 2009)

Shares of the newly independent AOL Inc. (Aol.) opened at $23.39 on the New York Stock Exchange on Thursday as the Internet company officially separated from media giant Time Warner Inc. (TWX) AOL (oops… Aol.) shares slid after opening, recently trading at $23.09, giving the company a market value of $2.44 billion.

5 Responses to Why AOL Rebranding process may not succeed?

  1. Shane Reply

    November 28, 2009 at 11:53 pm

    Meheer,

    It is too obvious of a mistake for AOL to committ. Good points though.. I wonder how a poineering organization could screw up in such fashion.

    • Meheer Thakare Reply

      November 30, 2009 at 8:12 am

      .. I reckon the best Aol. could do to counter this is ignore those weird gestures from being displayed in ITALY.

  2. Shane Reply

    December 2, 2009 at 12:52 am

    I agree. But would that stop ‘Aol.’ from encountering criticisms like this one globally?? Dont think so.

  3. Ed Roach Reply

    January 17, 2010 at 10:02 pm

    You know, I don’t know what the relevance is of AOL anymore. It certainly isn’t top of mind. This new direction seems a bit desperate.

    • Meheer Thakare Reply

      January 18, 2010 at 4:31 am

      Yea. It does not distinguish itself enough, does it??

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