Two weeks ago, company shareholders approved a name change: MGM Mirage became MGM Resorts International. It was a major change, but was it good business? According to two corporate branding experts, it was.
MGM CEO Jim Murren outlined the change as an “evolution” that “honors our heritage, better represents the growing global presence our company has today and positions us to move forward under a unified brand strategy.”
Laura Ries, president of marketing strategy firm Ries and Ries, and co-author of The 22 Immutable Laws of Branding (HarperCollins Publishers, 1998), thinks this was a good move.
“It can be confusing to have a two-part name,” Ries says, citing the example of AOL/Time Warner, whose 2000 merger was a case study in how not to combine two formerly successful companies.
“Often, when you have a merger, you want to keep both company names to keep everyone happy,” she says. “But in the long run, it’s a mouthful. In this situation, the two names clash. They are two separate resorts, and The Mirage is tied to Steve Wynn.”
Although Wynn sold Mirage Resorts to MGM a decade ago, and has since put his name on a newer Strip hotel-casino, Ries makes the point that many potential customers, particularly those in the international market into which MGM is hoping to expand, still associate The Mirage with Wynn.
“It’s smart to focus on one name,” Ries says. “The only downside is that they are just initials. In general, initials tend to be weaker than a ‘name’ name, but MGM has the benefit of initials that have a long history. When people hear ‘MGM’ they think of the lion,” a reference to Metro-Goldwyn-Mayer’s mascot, a stylized version of which remains in the MGM corporate logo. “Internationally, MGM is better known than the Mirage name.”
The other components of the name fare just as well. “Resorts” reflects the reality that the company has moved into nongaming hospitality, while “International” is a rather literal reminder of MGM’s aspirations to become a global brand.
“Clearly the overall company is MGM,” Ries says. “From a corporate perspective, having Mirage in the name just didn’t make sense anymore. It’s easy to remember a single overall name, under which the company owns many different resorts and brands.”
Brand consultant Alina Wheeler, author of Designing Brand Identity (Wiley, 2006), a leading guide for branding teams around the world, agrees. “The right name is timeless, tireless, easy to say and remember,” she says. “It stands for something. It is aligned with strategy. A well-chosen name is an essential brand asset, as well as a 24/7 workhorse.”
Names can have a real impact on the bottom line. Iconic American motorcycle builder Harley-Davidson learned that when it changed its ticker symbol from HDI to HOG. “Their shares gained nearly 16 percent, compared to about a 4 percent increase over the same period of the Standard and Poor’s 500 stock index,” Wheeler says.
She agrees that the name change for MGM was overdue.
“As much as I admire what Mirage accomplished,” Wheeler says, “I hate those names where people can’t commit to a master brand. Example: PricewaterhouseCoopers or ExxonMobil.”
But isn’t MGM Resorts International a little on the long side? It’s 10 syllables, a real mouthful compared to fellow gamers Boyd Gaming and Wynn Resorts (three syllables each), Las Vegas Sands (four) and even Harrah’s Entertainment (six).
“Their URL is MGM Resorts, and I think of that as the primary communicative name that will be used in conversations,” Wheeler says. “Their full legal name will be in the mice type at the bottom of their asset’s websites next to the copyright symbol.”
All in all, the experts agree that MGM has done well with their old new name.
Overall, Ries scores the new name “about a nine,” on a scale of one to 10.
“MGM is a great brand name—recognizable and memorable,” Wheeler says. “It’s the primary brand name. And they own the ticker symbol. How great is that?”
So, according to the experts, there’s plenty in a name, and MGM Resorts has chosen a good one. Hopefully shareholders and investors, to say nothing of visitors to its properties, share that assessment.