Facebook made headlines around the world recently when it changed its name to ‘Meta’, highlighting its focus on bringing the metaverse to life and helping people connect, find communities and grow businesses.
The official announcement said: “The metaverse will feel like a hybrid of today’s online social experiences, sometimes expanded into three dimensions or projected into the physical world. It will let you share immersive experiences with other people even when you can’t be together — and do things together you couldn’t do in the physical world. It’s the next evolution in a long line of social technologies, and it’s ushering in a new chapter for our company.”
The move attracted some support, but also many detractors who saw it as a way of rebranding the company after the reputational damage suffered by the Facebook brand over the last few years, as issues around privacy, undue influence, election rigging and exploitation all rose to public prominence.
Writing shortly after the announcement, The Australian Financial Review’s John Davidson said: “There’s a lot to joke about in Facebook’s laughable attempt to escape its reputation as the internet’s most toxic company, by renaming itself to Meta and reshaping itself around the futuristic metaverse.”
The question here for corporate communications professionals is this: does rebranding a company work after you’ve been put through the wringer? Or is it just a waste of time, as at the end of the day, your corporate DNA still exists and you are essentially the same company with all the same strengths and weaknesses? Let’s look at a couple of examples.
US private security company Blackwater was founded in 1996 to provide training to military and US law enforcement. It grew at a decent pace and ended up being able to extend that support to US forces on operations during the various conflicts after 9/11. The company got into trouble in Iraq, where after a massacre in 2007 involving the deaths of 17 civilians, Blackwater contractors were convicted. Other incidents occurred, and the company was also fined US $42 million regarding allegations that it illegally supplied armaments and military equipment overseas.
Following the bad publicity, Blackwater changed its name to Xe Services in 2009, and then again in 2010 after a private sector investment, this time to Academi. Four years after that, a merger with another company created the Constellis Group, where it remains today. Interestingly, in the public Constellis timeline on its website, its history focuses on the non-Blackwater development of the company. The old Academi brand is only mentioned once, and Blackwater not at all, of course.
One could argue that as the core part of the business survives, although much amended, the rebranding of the Blackwater brand and operations has been a success, even though it’s a complex history that has also benefited from dilution owing to M&A activities.
Another successful example of rebranding is global commodities trader Glencore. Hardly a household name outside business circles, the company was founded by legendary – and notorious – Swiss commodities trader Marc Rich, and initially known as Marc Rich + Co AG.
A Reuters article described Rich as a “sensation in commodity circles” who was credited by some with the invention of the spot market for crude oil – in short, someone who has shaped global markets.
But he was also a deeply controversial figure whose genius for dealmaking took him to some dangerous places and attracted the attention of law enforcement. In the 1980s he was charged by US authorities with tax evasion and selling oil to Iran during the hostage crisis a few years previously. He ended up on the FBI’s ‘Most Wanted’ list and living as a fugitive in Switzerland, until infamously being pardoned by President Clinton on his last day in office in 2001.
Today, following a management buyout and rebranding, his successors run the company now known as Glencore, a powerhouse with revenues of US$142 billion in 2020. But perhaps unsurprisingly its founder only gets the briefest of mentions in the website corporate history, despite being a seminal figure in global commodity trading history.
Once again, this has to be considered a success. As time goes by, few people outside of industry insiders, some politicians and law enforcement personnel, along with the business media covering the company, would be aware of its controversial history (although they are far more likely to be aware of issues that have arisen after Marc Rich’s tenure). The Glencore name seems to work well for the company, there can be no doubting its financial successes, and not many of today’s media articles about the company mention its founder.
So where does this leave Facebook and its Meta future? For all the mockery, sarcasm and justified criticism, there’s a good chance this rebranding will succeed. The company has strength in depth, with technological expertise, US$85 billion in revenues and global recognition.
Those advantages do not go away easily, and with the rebrand, the company is giving itself the chance to evolve and put some of the bad times behind it. While there will no doubt be more controversy, time will pass, people will forget, and Meta will likely achieve a more positive reputation as new products and services drive future growth.
JULIAN ELLIOTT
