The move, which will see Chunghwa Post renamed Taiwan Post and the Chinese Petroleum Corporation switch to Taiwan CPC Corporation, among others, is a costly one, with some estimates suggesting it could cost US$30 million in its initial stages.
The business sector, which has effectively been struggling to make ends meet through a difficult period of economic stagnation, sees the plan as costly and, if the KMT wins power in the next election and duly reverts to the original names as has been reported, an ultimately ineffective, waste of time.
The decision has also been poorly received from employees at those state-owned companies in question, with labour groups at several of the enterprises promising protests should the Government push ahead with the initiative.
The response from mainland China, meanwwhile, has been uncharacteristically muted. At Media’s press time the two countries were close to signing a deal allowing for a greater tourism-based relationship in the years to come.
So will all of this affect Taiwan as a brand, especially in the eyes of foreign observers?
Most think not, stating that business will continue as usual, preferring to focus on making money rather than involving themselves with those who are potentially making trouble.
But, according to industry experts, the implications for those individual brands in a marketing sense are considerable. As many explain, the decision to rebrand the companies appears to have been made quickly and on a political level, with a view to an election in early 2008.
Little research appears to have been conducted into whether the move will help or harm brand equity among consumers, who are unlikely to be convinced by the political pawn game. President Chen Shui-bian, it appears, still has some convincing to do.
Wei Hsiang, general manager, Weber Shandwick Taiwan
The potential outcomes remind one of the spaghetti Western movie The Good, The Bad and The Ugly. A quick analysis reveals that each company’s target market helps define where it falls.
The good: Companies that are B2B-focused in general will benefit, as a shift from ‘China’ to ‘Taiwan’ helps clarify where the company is based. This can also generate new customers, while old customers are retained through light rebranding communications.
The bad: Taiwan Post got the short end of the stick. As the only domestic mail company, with no international offices, only consumers in Taiwan are affected. Impact is estimated at US$40 million in shelling out for new collaterals.
The ugly: Most companies up for rebranding serve both B2B and B2C markets, and have much more on the line than just a name. Not only will millions of dollars be spent on consumer education and rebranding, but the intrinsic value generated from the brand name and loyal customers hinges on the success of linking the old brand name with the new one.
In the end, what’s done is done. However, the Government must analyse its rebranding efforts to ensure it receives the best value on its rebranding investments.
Christopher Fay, CEO, Saatchi & Saatchi Taiwan
On a consumer level, these recent name changes are unlikely to have a strong impact. Throughout this decade, Saatchi & Saatchi’s X-Ploring research has consistently shown that Taiwanese consumers spend very little time worrying about cross-strait political matters. Many consider the matter out of their hands and prefer to devote attention and energy to family, finances and romance.
Nevertheless, armchair marketers cannot help but see opportunity lost in these name changes. Those of us who spend our days and nights operating on a consumer or customer level will note that the costs involved in executing a name change, the impact such changes might have on employees, constituents, customers, investors, etcetera and the potential of added — not reduced — confusion are more than worthy of professional analysis and planning.
There is one small ray of hope in all of this. The same people who named Chinese Petroleum Corp and Chunghwa Post years ago made the enlightened decision to name the state-owned beer brand ‘Taiwan Beer’. It enjoys a massive leadership position and is definitely a lovemark. It is possible that the future could be even brighter for all of Taiwan’s renamed entities.