Will Google’s Brand Value Overshadow Alphabet

Thanks to Google, the word Alphabet has two different meanings today. The newest meaning stands for its parent company, in which Google is a subsidiary, jostling for space with its other ambitious projects such as life science division, urban planning mission, driver less car project etc. The objective is clear: it wants its experimental projects to come out of the search engine giants shadow and meet with success under their own brand identity.

Google stands justified on two counts: being associated with too many different areas, Google was needlessly sending confusion signals about its core business and increasingly exposing itself to risks which saw the likes of Virgin and Starbucks go on a steep decline. Secondly, the move would help a company of its size promote exchange of ideas across initiatives for process improvements while avoiding success and failures of these initiatives to impact the running of its core business.

But the all-important question is: will this move affect Google’s brand value with consumers? How will consumers take to a change in the name of something they are so used to like Google Glass? Will its name carry the same magic when renamed “Alphabet Glass”? Or will Google Ventures, a project for investing in small startups command the same awe and trust if renamed “Alphabet ventures”. Marketers say when a trusted name is replaced by an unknown name, much of the trust associated with the old name is at stake. So, if companies under Alphabet develop their own brands, it may not get a favorable response.

The other risk is that Alphabet might have a lopsided brand equity value, with Google hogging the limelight. Given that it took Google more than a decade to define its core brand values of innovation and technology, new acquisitions under Alphabet may find it difficult to catch up with brand Google. Also if a venture fails to or takes too long to come up with a compelling solution it will continue to live under the shadow of a more dominant companion and be viewed as a laggard. Such disparities may undo the very purpose of bringing all other ventures under one parent brand.

Though it’s too early to prejudge the “Alphabet” re-branding, investors seem to be happy about the move, as is evident with the company’s stock performance. So get prepared to read the search engine’s next acquisition move as “Alphabet acquires ….”.