What’s in a business name?

You can hardly influence your child’s development by selecting any name. That is one of the conclusions of Steven Levitt published in the book “Freakonomics”. Most of the influence is given to a child even before it is born. However, he can do wrong, according to an example in the same book of a father who named his first child “Winner” and last born “Loser.” Imagine what happened to both of them …

Whether you agree with Levitt and favor a nature point of view or disagree and favor a nurturing argument, when it comes to business, there is only one option; The name you choose, as a cultural element, will influence your business.

Recently a Dutch company TPG publication announced the change of its name to TNT Post. The company is the product of a spin-off that took place in 1996 when the Post and Communications divisions became separate companies; KPN, the holding company prior to that date, continued with the telecommunications division. The postal division, including the recent acquisition of the Australian logistics company TNT, continued under the new name TNT Post Group or TPG. And now the company continues under the name: TNT Post.

On the same stock exchange, the AEX, there are more companies with similar backgrounds. To start with the “A”, ABN AMRO is a bank that is the result of the merger of two companies ABN and AMRO that kept their name in the new combination. The name “ING”, which stands for a bank-insurer, is a nice name invented by the Inter-Nationale Nederlanden Group, where “Nationale Nederlanden” was and still is the insurance part of the group.

Reed Elsevier is another example where two companies have merged and the original entity names continue to exist. In this case, “Reed” is of British origin and Elsevier the Dutch counterpart. This is no different for Wolters (and) Kluwer, like the company mentioned above, also in the publishing and information exchange sector, although both parties are Dutch.

Numico is a company that has also merged with others and that chooses to keep the previous company names in the new combination. In this case Nutricia (Nu) merged with the German Milupa (Mi) and the British Cow & Gate (Co). Giving Nu-Mi-co. This example is different if all three companies still exist under the old labels, Nutricia in the Netherlands, Milupa in Germany and Cow & Gate in the UK.

The image and identity of a company is linked to the name it bears. Companies that grow internationally and become multinational are better off with an international name than a local name.

The name of a company also represents an internal culture. In the case of ABN and AMRO, culture could be expressed as the best of both worlds: ABN and AMRO, or together we are more. For NuMiCo, the cultural direction is less visible; the name of the company after the merger seems to express a new culture.

Back to TNT Post. In this case, the new name inherits most of the Australian name TNT (Thomas Nationwide Transport). A logical choice, due to TNT’s international brand equity.

For the situation in the Netherlands there is a small compensation; the main company color (red) will be replaced by orange, a royal color (Dutch); TNT Post has given itself a new cultural start by offering the best of both worlds.

© 2006 Hans Bool