Facebook's 'Meta' transformation and the complexity of rebranding

• English

One imagines that Facebook CEO Mark Zuckerberg tries to focus on the big picture above all. As such, the recent decision to rebrand his company's various products under a new umbrella name, Meta, though somewhat surprising, was quite understandable.

Zuckerberg has said that the decision to rebrand was based mainly on his belief in the potential of the so-called "metaverse." However, a closer examination of the situation reveals that many factors likely motivated the company formerly known as Facebook and its chief executive, including several consecutive years of major controversies.

What has been going on with Facebook serves as a compelling illustration of how complex and challenging rebranding can be, especially from an Intellectual Property (IP) perspective.

Rebranding in the wake of controversy

Facebook announced the rebrand of its corporate identity on October 28, 2021. The company's flagship social network retained its original name, as did popular services like Instagram and WhatsApp, while the umbrella company is now called Meta. The once-iconic white-on-blue, lowercase-f logo has been replaced by a pale blue version of the mathematical symbol for infinity, stylized to resemble an "m."

Although the announcement was sudden, it could hardly be called arbitrary in retrospect. 2021 has been a year of great scandal for Facebook / Meta. While the company and Zuckerberg himself are no strangers to public reproach, this period has been considerably more intense:

• Multiple technical issues and inconsistent moderation by senior leadership allowed Facebook to be a communication tool for rioters who attacked the US Capitol building.
• The social network's inability to control the spread of misinformation about COVID-19 and the vaccines that combat it provoked scathing criticism from President Joe Biden, who said platforms that allowed vaccine falsehoods to spread were "killing people."
• In testimony to the United States Congress, former Facebook data scientist Frances Haugen explained that Facebook's algorithm amplified misinformation and hate speech by focusing on engagement above all else.
• The company's own research, which was kept confidential until Haugen's most recent testimony, showed evidence that Instagram did severe harm to the mental health of adolescent girls.

That is just a tiny sample of what has emerged about Facebook in the past year. There is so much of it that numerous media outlets have published multi-part article series about the scandals.

An established (if questionable) precedent

In all public statements regarding the Meta rebrand, Zuckerberg has stuck to his claims of being laser-focused on the metaverse: the company's name for a, mostly hypothetical, series of interconnected digital universes that users explore with virtual avatars. During an October 28 interview with The Verge, he claimed the announcement's timing was coincidental and that he would ideally never make a branding change during a negative news cycle.

We cannot, of course, make any definitive judgment regarding Zuckerberg's motivation for this rebrand. But that the company now known as Meta has been mired in controversy all year is a matter of indisputable fact. It is also true that various companies have attempted significant rebrands or, at the very least, re-namings, after scandals or legal disputes. Some notable examples:

• Uber has rebranded multiple times in the past few years in actions that, like Facebook's, have been met with some suspicion.
• Valeant Pharmaceuticals rebranded itself as Bausch Health in 2018 after being lambasted for massive price increases in 2015.
• Following the acquisition by Intel, cybersecurity software vendor McAfee temporarily changed its branding to Intel Security in the mid-2010s to disassociate the company from its erratic (and now-deceased) founder.
• Cigarette company Philip Morris rebranded itself as Altria in 2003, in an effort to emphasize a broader catalog of products.
• WorldCom, a telecommunications firm host to the largest accounting scandal in U.S. history, rebranded as MCI in 2003.

Were these efforts successful?

In most cases, the answer is not a simple yes or no:

• Uber: While its reputation has suffered, it remains successful and had a high-value initial public offering (IPO) in 2019; its only meaningful competitor is Lyft.
• Bausch: The company formerly known as Valeant had to surrender 1.21 billion USD to shareholders for misleading them and has been embroiled in lawsuits and Securities and Exchange Commission (SEC) investigations since 2019. Nevertheless, its annual revenue is approximately 8.6 billion USD.
• McAfee: Though still majority-owned by the organization that wanted to isolate itself from John McAfee, the software company had fully returned to its original name and branding by 2019.
• Altria: Little of Altria's branding is consumer-facing. The conglomerate's tobacco unit is still called Philip Morris USA, and the brand names in its portfolio, like Marlboro and Parliament, stick out to consumers. Even the corporation's subsidiary Kraft Foods was sold off, leaving one to wonder whether the attempt to distance itself from the negative perception of tobacco was worth it.
• WorldCom: This rebrand was a complete failure, befitting the staggering levels of corruption associated with WorldCom's executives. The disgraced company laid off tens of thousands of workers even after fulfilling all obligations during its bankruptcy. Verizon bought it in 2006.

It is undoubtedly too early to tell whether the Meta rebrand will succeed for Zuckerberg. The company itself, if nothing else, is likely "too big to fail" in the foreseeable future. But if the social networking giant is put under increased regulatory scrutiny, this could adversely impact its metaverse projects. Regulators would be likely to enact strict restrictions on virtual e-commerce, and as such, it remains possible that the rebrand could be a net neutral or net negative in the long term.

Strategic considerations for rebranding

Most rebranding campaigns, of course, do not involve serious disrepute of any kind. Many are not even related to any pressing commercial need. But the complicated variables surrounding the Meta rebrand make it difficult to speculate how it might proceed, while the unique circumstances mean it is not necessarily an approach that should be emulated.

Successful rebrands can be rooted in a desire to reconnect an organization's branding elements — names, logos or other trademarks — with its core mission. Targeting an expanded customer base with novel products or services can also be aided by a rebrand, as can expansions into new jurisdictions across the globe. The key is to not rebrand impulsively or without a solid business reason.

At Dennemeyer, we understand and value the power of trademarks and their ability to establish or recreate a brand identity. We can assist you across all aspects of trademark filing, prosecution and management as you endeavor to create and register the IP that connects your organization's ideas and mission with your consumers.