“I’m going to L.A.,” the corporate executive will say. “And then I have to make a trip to New York.” Why is Los Angeles often called L.A., but New York is seldom called N.Y.?
“I worked for GE for a couple of years and then went to Western Union.” Why is General Electric often called GE, but Western Union is seldom called WU?
General Motors is often GM, American Motors is often AM, but Ford Motor is almost never FM.
The principle at work here is phonetic shorthand.
Ra-di-o Cor-po-ra-tion of A-mer-i-ca is 12 syllables long. No wonder most people use R-C-A, three syllables long.
Gen-er-al E-lec-tric is six syllables long, so most people use G-E, two syllables.
Gen-er-al Mo-tors is often GM. A-mer-i-can Mo-tors is often AM. But Ford Mo-tor is almost never referred to as FM. The single syllable Ford says it all.
But where there’s no phonetic advantage, most people won’t use initials. New York and N.Y. are both two syllables long. So while the initials N.Y. are often written, they are seldom spoken.
Los An-ge-les is four syllables long, so L.A. is frequently used. Note, too, that San Fran-cis-co, a four-syllable word, is seldom shortened to “S.F.” Why? There’s a perfectly good two syllable word (Frisco) to use a shorthand for San Francisco. Which is why people say “Jer-sey” for New Jersey instead of “N.J.”
When they have a choice of a word or a set of initials, both equal in phonetic length, people will invariably use the word, not the initials.
Phonetic length can sometimes fool you. The initials WU look a lot shorter than the name Western Union. But phonetically they are exactly the same length. Dou-ble-U U. West-ern Un-ion. (Except for W, every other English language letter is just one syllable.)
While customers refer to companies phonetically, the companies they talk about have a different way of looking at themselves. Companies are visually oriented. They go to a lot of trouble making sure the names look right without considering how it sounds.
Business people also fall into the same trap. The first thing to go is the given name. When young Edmund Gerald Brown starts up the executive ladder at General Manufacturing Corporation, he instantly becomes E. G. Brown from GMC on internal letters and memos.
But to be well known, you’ve got to avoid using initials—a fact known by most politicians. Which is why E. M. Kennedy and J. E. Carter bill themselves as Ted Kennedy and Jimmy Carter.
As a matter of fact, the new wave of politicians don’t use either middle names or initials. Jack Kemp, Gary Hart, Bill Bradley, George Bush, Ronald Reagan.
What about FDR and JFK? The irony of the situation is that once you get to the top, once you are well known, then initials can be used without ambiguity. Franklin Delano Roosevelt and John Fitzgerald Kennedy could use initials only after they became famous. Not before.
The next thing to go is the name of the company. What starts out as visual shorthand to conserve paper and typing time ends up as the monogram of success.
IBM, AT&T, GE, 3M. Sometimes it seems that membership in the Fortune 500 depends upon having a readily recognized set of initials. The moniker that tells the world you have made it.
So today, we have such monikers as AM International, AMAX, AMF, AMP, BOC, CBI Industries, CF Industries, CPC International, EG&G, FMC, GAF, IC Industries, ITT, LTV, MEI, NCR, NL Industries, NVF, PPG Industries, SCM, TRW, and VF.
These are not two-bit companies. All are currently on Fortune’s list of the 500 largest industrial companies. The smallest company on the list, AM International, had sales of $598 million in a recent year and more than 10,000 employees. (You might recognize them as the former Addressograph Multigraph Corp.)
If you select the company next up in size from every initial company on the Fortune 500 list, you will find the following: Allegheny International, American Motors, Amstar, Bristol-Myers, Celanese, Cluett Peabody, Consolidated Foods, Data General, Gannett, Hartmarx, H. J. Heinz, Hewlett-Packard, Inspiration Resources, Lever Brothers, Louisiana Land & Exploration, Mohasco, National Cooperative Refinery Association, North American Philips, Procter & Gamble, G. D. Searle, Weirton Steel, and Westmoreland Coal.
Which list of companies is better known? The name companies, of course.
Some of the initial companies like ITT and NCR are well known, to be sure. But like FDR and JFK, these companies were well known before they dropped their names in favor of initials.
Which companies are likely to grow faster? Again, the name companies.
To test this point, we conducted a survey of both “name” and “initial” companies using a Business Week subscriber list. The results show the value of a name.
The average awareness of the “initial” companies was 49 percent. The average awareness of a matched group of “name” companies was 68 percent, 19 percentage points higher.
What drives big companies into committing corporate suicide? For one thing, the top executives have seen the company’s initials on internal memos for so long they just naturally assume that everybody knows good old VF. Then, too, they misread the reasons for the success of companies like IBM and GE.
A company must be extremely well known before it can use initials successfully. Apparently the use of the initials “GE” triggers the words “General Electric” inside the brain.
Invariably, people must know the name first before they will respond to initials. The Federal Bureau of Investigation and the Internal Revenue Service are extremely well known. So we respond instantly to FBI and IRS.
But HUD is not recognized nearly so quickly. Why? Because most people don’t know the Department of Housing and Urban Development. So if HUD wants to become better known, the department must first make the name Housing and Urban Development better known. Taking a shortcut by using only the initials HUD won’t help very much.
Similarly, General Aniline & Film was not a very well known company. When they changed their name to GAF, they made certain that they were never going to become very well known. Now that GAF has legally changed its name to initials, presumably there’s no way to expose the prospect to the original name.
Yet alphabet soup seems to be on the corporate menu of many companies today. They fail to think through the process of positioning themselves in the mind. So they fall victim to the fad of the day.
And, no question about it, today’s fad is “initialitus.” Look at RCA. Everyone knows that RCA stands for Radio Corporation of America. So the company could use the initials to trigger the “Radio Corporation of America” words buried deep inside the mind.
But now that RCA is legally RCA, what will happen next? Nothing. At least in the next decade or so. The words are already buried in the minds of millions of people. And they’ll stay there indefinitely.
But what about the next generation of prospects? What will they think when they see those strange initials, RCA?
Roman Catholic Archdiocese?
Positioning is like the game of life. A long-term proposition. Name decisions made today may not bear fruit until many, many years in the future.
The primary reason name selection errors are so common is that executives live in an ocean of paper. Letters, memos, reports. Swimming in the Xerox sea, it’s easy to forget that the mind works aurally. To utter a word, we first translate the letters into sounds. Which is why beginners move their lips when they read.
When you were a child, you first learned to speak and then to read. And you learned to read slowly and laboriously by saying the words out loud as you forced your mind to connect the written word with the aural sound stored in the brain.
By comparison, learning to speak requires much less effort than learning to read. We store sounds directly and then play them back in various combinations as our mental dexterity improves.
As you grow up, you learn to translate written words into the aural language needed by the brain so rapidly that you are unaware the translation process is taking place.
Then you read in the paper that 80 percent of learning takes place through the eyes. Of course it does. But reading is only a portion of the learning process. Much learning occurs from visual clues which do not involve reading in the conventional sense at all. As when you learn the emotional state of another person by “reading” body clues.
When words are read, they are not understood until the visual/verbal translator in your brain takes over to make aural sense out of what you have seen.
In the same way, a musician learns to read music and hear the sound in his or her head, just as if someone were actually playing the tune on an instrument.
Try to memorize a poem without reading it out loud. It’s far easier to memorize written material if we reinforce the aural component, the working language of the brain.
Which is why not only names but also headlines, slogans, and themes should be examined for their aural qualities. Even if you plan to use them in printed material only.
Did you think that Hubert and Elmer were bad names? If so, you must have translated the printed words into their aural equivalents. Because Hubert and Elmer don’t look bad. They just sound bad.
In a way, it’s a shame that the print media (newspapers, magazines, outdoor advertising) came first and radio second. Radio is really the primal media. And print is the higher-level abstraction.
Messages would “sound better” in print if they were designed for radio first. Yet we usually do the reverse. We work first in print and then in the broadcast media.
Another reason companies drop their names for initials is the obsolescence of the name itself. RCA sells a lot of things besides radios.
And how about United Shoe Machinery? The company had become a conglomerate. Furthermore, the domestic shoe machinery market was drying up as imports continually increased their share. What to do? They took the easy way out. United Shoe Machinery changed its name to USM Corporation. And lived anonymously ever after.
Smith-Corona-Marchant is another company which has lost its corporate identity. The result of mergers, Smith never did make coronas or marchants. So it decided to shorten the name to SCM Corporation.
Presumably, both SCM and USM made the change to escape the obsolete identity of the past. Yet the fact is that the exact opposite occurred.
The mind can’t remember USM without dredging United Shoe Machinery from it subconscious.
At least RCA, USM, and SCM had phonetic shorthand going for them. Without it, the difficulties are greater. Much, much greater. When Corn Products Company changed its name to CPC International, it found little recognition of the CPC name. The initials CPC are not phonetically shorter than Corn Products. Both are three syllables long, so the CPC initials were seldom used until the name change was made. Ask people in the business if they are familiar with CPC International. See if they don’t say, “Oh, you mean Corn Products Company?”
In our initial-happy society, the first question the mind normally asks itself is, “What do those initials stand for?”
The mind sees the letters AT&T and says, “Ah, American Telephone & Telegraph.”
But what reply does the mind get when it sees TRW? Obviously, there are a fair number of people who remember the Thompson Ramo Wooldridge Corporation. And TRW is a $6 billion company, so it gets a lot of press and does a lot of advertising. But would those advertising dollars work harder if TRW had a “name” name instead of an initial name?
Some companies put sets of initials in series. How about trying to remember the D-M-E Corporation, a subsidiary of VSI Corporation?
We’re not trying to suggest that companies shouldn’t change their names. Quite the contrary. Nothing remains the same for very long. Times change. Products become obsolete. Markets come and go. And mergers are often necessary. So the time comes when a company must change its name.
U.S. Rubber was a worldwide corporation that marketed many products not made of rubber. Eaton Yale & Towne was the result of a merger that produced a big company with a complicated name. Socony-Mobil was saddled with a first name that originally stood for Standard Oil Company of New York.
All of these names have been changed for sound marketing reasons. The traditional “foot-in-the-past” approach could have produced USR Corporation, EY&T Company, and SM Inc. Three marketing monstrosities.
Instead, “forgetting the past” created three new modern corporate identities—Uniroyal, Eaton, and Mobil. The marketing strengths of these names speak for themselves. These companies successfully forgot the past and positioned themselves against the future.
In spite of the drawbacks, companies are lured to initials like moths to a candle. The success of the IBMs of this world seems to be proof that initials are effective. It’s the classic confusion between cause and effect.
International Business Machines became so rich and famous (the cause) that everyone knew what company you were talking about when you used its initials (the effect).
When you try to reverse the procedure, it doesn’t work. You can’t use the initials of a company that is only modestly successful (the cause) and then expect it to become rich and famous (the effect).
It’s like trying to become rich and famous by buying limousines and corporate jets. First, you have to become successful in order to have the money to buy the fringe benefits.
In some ways, the rush to adopt initials represents a desire to look accepted even at the cost of a loss in communications. It also represents the copycat thinking prevalent in some management circles. The success of IBM encouraged word processing competitors like CPT and NBI to use initials in their names.
The success of AT&T encouraged MCI to also market their long distance service with an initial name.
And look at the contrasting name strategies of two different airlines.
Pan A-mer-i-can Air-lines (seven syllables) has a phonetically long name. So they shortened it to Pan Am, two syllables. Much better than the initials PAA, which would be difficult to remember.
Trans World Air-lines (four syllables) is actually phonetically shorter than the T-Dou-ble-U-A they are using, But isn’t TWA well known? Yes, it is, thanks to $70 million worth of advertising a year.
Although TWA spends about as much on advertising as its larger American and United competitors, surveys show that TWA has half the passenger preference of the other two. The inefficiency of the initials TWA is one reason.
What name should Trans World Airlines use?
“Trans World,” of course. Only two syllables long, Trans World is short and graphic.
Some companies are lucky. Their initials, either by design or by accident, form acronyms. For example: Fiat (Federation Internationale Automobiles Torino) and Sabena (Société Anonyme Belge d’Exploitation de la Navigation Aèrienne).
Often organizations will select carefully names that form meaningful acronyms. Two examples: CARE (Committee for Aid and Rehabilitation in Europe) and MADD (Mothers Against Drunk Drivers).
Other companies aren’t so lucky. When General Aniline & Film changed its name to GAF, it chose to overlook the fact that the acronym sounds like “clumsy error.” GAF is a gaffe in more ways than one.
The other thing people tend to forget when they pick a name is the problem of finding it in the telephone directory. Since you seldom look up your own name in a phone book, you might not realize how hard it is to locate.
Take MCI, for example. In the Manhattan telephone directory, you might expect to find MCI somewhere between McHugh and McKensie. But of course, it’s not there. MCI Telecommunications is 48 pages away where it has to compete with seven other companies that incorporate MCI in their names. (Following standard rules of alphabetizing a list of names, the phone company puts all initial names up front.)
Take USM Corporation, for example. In the Manhattan telephone directory, there are seven pages of listings starting with “US.” So you ought to be able to find USM somewhere between US Luggage & Leather Products and US News & World Report.
But, of course, it’s not there. Those US listings stand for “United States,” as in United States Luggage. The US in USM doesn’t stand for anything. So again the name goes up front with the rest of the “pure” initial companies.
Many companies are saddled with obsolete names through no fault of their own. But before you throw away a name in favor of meaningless initials, see if you can find another “name” that will do the job you want done.
With a good name, your positioning job is going to be a lot easier.