Online Brands

The Financial Reward of Rebranding

Several months ago I analysed why Telecom’s rebrand sparked with potential. Now it’s time to consider whether Telecom’s rebrand has paid off. Rebranding is not a decision to be taken lightly – especially when you are a large and long-standing organisation. In Spark’s case this was a $20 million dollar decision.

As mentioned in a post on why Spark needed to rebrand, sinking profits and share market value were considered for:

“Although Spark was attempting to cut costs quickly, sales were falling faster. Operating earnings were down by 5.8% and net earnings from ongoing business fell by 12.5%. Although rebranding is potentially a risky venture amidst financial uncertainty, It has been largely successful. Following rebranding, Spark’s annual profit almost doubled. “

Months later this is still the case. Chairman Mark Verbiest claimed an increase in traffic to both retail and web stores. Traffic alone isn’t enough to fight a good case. Financials have also improved significantly – and not just in comparison to Spark’s poor performance before. said, “Taking into account dividends and Spark’s rising share price, shareholders would have seen a 53 per cent return on their investment since it embarked on its “transformation strategy” in June last year, Verbiest said. Spark shares broke through $3 last month for the first time since 2008.”

So although Telecom’s rebrand initially raised a few eyebrows, it has been paying of in the longer term.