Advertising challenges to swapping brand names

  • 2003-08-28
  • Justin Petrone
TALLINN - Ever wonder what the cost of a corporate name-change would be in the
Well, thanks to Elion, formerly known as Eesti Telefon, we now have an
answer: 8 million kroons (500,000 euros).
With a brand new logo, image, advertising campaign and, in some ways, a new
company, Elion has officially replaced Eesti Telefon. Beginning Aug. 18, all
of the communication giant's brands will be rebranded as Elion companies.
The change, explain company officials, was dictated by necessity.
Eleven-year-old Eesti Telefon had operated six separately branded companies
- ET for fixed telephone line services, Atlas for data and Internet
services, for e-mail and communication portals, a retail chain Hallo
and Neti ­ a situation that confused many consumers.
"It was very ineffectual for us to support six different brands," said Piret
Murk, public relations and communication director at Elion Enterprises. "How
can you trust a company that has six faces and six voices? Having one brand
name is much simpler and more understandable for our consumers," she
And so Eesti Telefon began a major rebranding project two years ago.
Interestingly, Murk said that during the process managers decided to leave
one brand name ­Neti, the popular Estonian search engine ­ untouched.
"Neti is a very clear, stand-alone product brand. Almost every Estonian
knows that if they want to search the Internet, they can use Neti to do it,"
she said.
The brand, however, is not only skin-deep. Murk said that Elion would be a
very different company from what Eesti Telefon used to be.
"We were a monopoly, technology-based company. All of our functions were
product-based. Now we have changed to being more of a consumer
service-oriented company," said Murk.
"We also offer financial services. For example, a customer can now use Elion
to pay their rent, or a payment on a car," she said.
Some of Elion's services now include a 24-hours-a-day help-desk and its
rechristened retail chain (formerly Hallo) that supplies mobile phones,
printers, computers and other communication tools.
According to Murk, the company also invested 3 million kroons for training
service people - just to bring Elion to the level of what the brand
"The company structure has changed a lot. We have restructured the company
according to customer needs. Employees are empowered to serve better for one
shared brand name," said Murk.
Much of the new marketing strategy and identity for Elion came out of a
partnership with the London office of Futurebrand, part of the
McCann-Erickson group that specializes in branding projects.
Elion also enlisted the help of Division, an Estonian advertising agency, to
create advertisements that reflect Elion's new sensibilities.
According to Murk, the company's total investment in the name-change and new
brand was about 8 million kroons, including 350,000 kroons for the logo, 4
million kroons for the development and change of its visual identity, 2
million kroons for marketing consultancy and the training of service staff,
as well as 1.6 million kroons for the launch campaign.
The name Elion itself was selected from 700 words. As Murk explained, the
"E" stands for Estonia, the "I" for inspiration and the "ON" for online.
The colors red, sky-blue and forest-green were chosen to reflect Estonia's
nature and Elion's commitment to being an environmentally conscious company.
Confusion over brand names wasn't the only reason for rebranding. After
Eesti Telefon's monopoly over the telecommunication market ended in January
2001 with EU-mandated deregulation, it began to face some competition as
smaller, single service communication providers nipped away at its consumer
With an annual turnover of 2.6 billion kroons, Eesti Telefon is still the
biggest fixed-line telecommunication provider in Estonia, though it faces
stiff competition from larger companies like Tele2, Vodaphone and
"We needed a new brand mark to compete. The first year after liberalization
we had a very big price competition in the telecommunication market," said
Toomas Tiivel, marketing director for Tele2, which offers fixed-line,
mobile-phone, Internet and cable-TV services, agreed with Murk's assessment
of the market.
"In the fixed-line business Elion is certainly our main competitor," Tiivel
said. "We have the lowest prices in the market. For Elion it is so hard to
compete because their organization is so big. It's good that they changed
their name because people have bad memories of high prices and waiting in
lines to get phones installed."
Tiivel says that while he likes the new image of Elion, the biggest work
with the rival company still needs to be done.
"Personally I like the new brand name, but for ordinary people maybe it
doesn't matter so much. People don't pay so much attention to brand and soft
values, they pay attention to prices," said Tiivel.
Murk said that changing Elion's focus to customer service also came out of
the price wars in the industry.
"We cannot compete on the price base because Tele2 is there. They have the
cheapest service in Europe. We want to compete on the service base," said
Elion plans to add new services in the near future, while much of its older
services, like, remain the same.
"We didn't want to change everything in one day, in one click. We will
slowly add new services. In October we will add Estonian Television
broadcasts via the Internet. Later we will provide more educational
services," said Murk.