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RadioShack CMO: We're Not (Really) Changing Our Name

'The Shack' Just a Marketing Nickname; Company Says Criticism Based on Confusion

By Published on .

NEW YORK (AdAge.com) -- Yes, RadioShack has seen the criticism of its new branding. No, it's not worried.

What do you think of the name change? Leave your comments below.
What do you think of the name change? Leave your comments below.
Earlier this week, RadioShack unveiled its new branding, which includes the nickname "The Shack." Immediately Twitter users and a host of bloggers were sharing their thoughts -- many of them unflattering. Tech blogs zeroed in on the fact that the company appears to be embarking on a pricey (and misguided) marketing effort rather than addressing any number of core issues.

In an interview with Ad Age, Chief Marketing Officer Lee Applbaum downplayed criticisms of the nickname. He pointed out that consumers and media are drawing conclusion before they've seen any of the new campaign. The company has no plans to eliminate its RadioShack moniker, and the name will remain unchanged on exterior signage at stores. Those details were not apparent based on the company's press release, as evidenced by the media coverage the announcement received.

When asked why the company did not roll out the campaign in a way that would have avoided at least some of the confusion, Mr. Applbaum insisted that the company is "very strategic." He said it's difficult to "dissect any one piece" of the platform and its rollout.

"When you contemporize an iconic brand, when you in any way seek to change that, it makes people uncomfortable, and I understand that," he said. "I think [the criticism] is a reflection on the passion people have for an iconic brand. If people aren't uncomfortable, then you haven't done your job in being transformative."

RadioShack's challenges
In recent years, RadioShack has suffered from myriad issues, among them an indistinct position in the marketplace, a name that hardly identified the products it carried, stores a fraction the size of competitors' and a reputation for less-than-stellar customer service. In the second quarter, net sales dipped 3%, while same-store sales declined 4%.

The blog CrunchGear pointed out that the retailer's issues run far deeper than a simple name change. And Technologizer declared, "Name changes just don't work. ... Most often, it's a sign that the company in question has real problems but it's unwilling to confront them."

Mr. Applbaum said the focus on marketing will not distract the company from things such as store experience and customer service. "We're simultaneously working to evolve and enhance the customer experience," he said. "But there are a lot of consumers that don't understand RadioShack today. ... To people that have not shopped with us or have not shopped with us in a long time, it's important that we reintroduce ourselves."

To that end, the company embarked on a plan to freshen up RadioShack's image nearly a year ago. Mr. Applbaum joined the company nine months ago, and Butler, Shine, Stern and Partners won the account in April following a review.

An artist's rendering of the marketer's Netogether, which will include two 17-foot laptops with webcams that will stream live video and audio between New York and San Francisco.
An artist's rendering of the marketer's Netogether, which will include two 17-foot laptops with webcams that will stream live video and audio between New York and San Francisco.
The idea to use the nickname The Shack was arrived at independently by both Butler Shine and RadioShack. "The agency brought it to us because they thought it was a nice, contemporary shorthand for the company," he said. "When they presented it to us, they realized it was a brand truth."

Enormous amount of equity
The nickname and the new creative campaign have been extensively tested with consumers -- those who frequent the retailer and those who don't, Mr. Applbaum said. The nickname will appear on in-store signage, in brand communications and on things such as gift cards. Mr. Applbaum reiterated that RadioShack, as a brand name, has an enormous amount of equity. That's something executives have been highlighting for months, as analysts have raised questions about whether the name presents a barrier.

Still, marketers know by now to expect some backlash to a new name or even an alias, as brands such as Brink's and Pizza Hut have found out in recent months.

The media blitz will begin tomorrow and will include a dozen 15-second spots, Sunday circulars, digital media, in-store signage, print ads, out of home and direct mail. The retailer is also hosting something called Netogether Aug. 6 through Aug. 8 in New York's Time Square and San Francisco's Just Herman Plaza. Two 17-foot laptops with webcams will be set up to stream live video and audio between the two locations.

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