From telco to tech co: how rebranding helps operators diversify

From telco to tech co: how rebranding helps operators diversify

In an industry as future-focused as telecoms, service providers need to ensure that their branding conveys the right messaging to prospective subscribers.

While brand recognition is hugely important, on occasion we see longstanding, widely-recognised brand names dropped almost overnight – think Qtel becoming Ooredoo or VimpleCom becoming Veon. If a rebrand isn’t motivated by a change in ownership, what are the driving factors?

“Looking at the telecommunications industry from a brand viewpoint we see a very mixed and confusing landscape”, says Justin Paul of Ultra Blue Marketing. “Some companies still leverage the names from their postal service origins. Others have been using a very restraining approach (Fon/Com/Tel) which potentially hinders diversification and is increasingly losing its relevance.”

Paul notes that the aforementioned approach was frequently adopted in the 90’s to underline the idea that the brand offered telecommunications services. He highlights Vodafone as the best example of this approach given that its branding has proven successful in 22 countries.

The UK-headquartered operator group was similarly described as a “winning” brand by Hatem Dowidar, former holder of several leadership positions at Vodafone and current CEO of UAE-headquartered e&. While he acknowledges the brand’s accomplishments, Dowidar cautions that Vodafone’s story reflects that of the telecoms sector in Europe. Initially it was ahead of the rest of the world, with Dowidar saying: “Everybody wanted to join these [European] companies…today it’s a complete different story”.

Most major European operator groups, including Vodafone, Orange, and Telefonica, have declined since their glory years, and this is informing the approach of operator groups in emerging markets as they seek to expand their offerings and audiences. Paul notes that companies are now avoiding branding that is overtly tied to the telecoms sector, as this no longer reflects the breadth and complexity of their offering. Citing examples from the new wave of telecom brand names such as Orange and EE, Paul argues that such “non-specific” brands are “the first attempt to create powerful consumer led brands…they don’t limit or define what their commercial offering is.”

Branching across different industry verticals is a key factor behind ostensibly ‘unnecessary’ rebrands – operators are aware that they have to push beyond telecoms and become tech companies, but are also conscious of the need to drive their brand values across each new vertical. This was the case with Etisalat; Dowidar notes that when the company realised that it would need to create and deliver digital services beyond the telecoms space, it would also need a consumer brand with no specific ties to the sector.

Paul concurs, saying: “Etisalat’s re-branding at the group level to e& is a great example of a telco creating a non-specific consumer brand. e& doesn’t indicate the organisation’s Middle Eastern ownership, regional focus, or even product and service offering. It’s short, it works in multiple languages, and is memorable. e& has created a brand without limitations.”

Etisalat was a well-established and widely recognised brand in the UAE, but two years ago it opted to commence its rebrand as e& under Dowidar’s leadership. At a recent event hosted by Brand Finance in London, the e& CEO explained how the operator was able to inspire its employees to embrace the rebrand, and how his experiences at Vodafone informed his approach.

“What I really learned from this is that you need to create this vision for people, of winning, doing something special, and that gets you the business performance. Because if you don't have the goal that the whole organisation is moving towards, you will not get there…but having a clear direction, and that direction is a winning direction that galvanises the whole organisation, gets everyone excited, gets us both the brand from a customer point of view but also the employer. This is the whole ethos of both running a business, but also attracting the right people in the organisation.”

Etisalat’s rebrand saw results very quickly, allowing the group to drop references to its previous branding in short order. Dowidar claims that this confidence was instrumental: “Sometimes you need to be autocratic about it – ‘this is where we’re going’…It’s a single-mindedness and the belief that if you start having doubts, you do it half-cooked, it doesn’t work.”

Dowidar notes that e&’s home market of the UAE was also a factor – he describes the atmosphere of the market as ambitious and disruptive, with companies competing to change the game in a more effective way. He argues that this mindset helped the market counter what he terms the ‘vicious cycle’ that occurred in Europe of heavy competition that led to a single-minded focus on delivering connectivity. This resulted in operators running out of money, investing less, and being forced to provide poor quality service as a result. Dowidar claims that the UAE has achieved a virtuous circle of ambition and competition, citing the example of a recent agreement between e& and ADNOC (Abu Dhabi National Oil Company) that will see the fossil fuel firm implement the largest private 5G implementation in the world in a 1 billion Dirham project that covers their onshore and offshore locations.

“This is our vision of digitally empowering societies” says Dowidar. “I think this is the black hole that many of telco companies went into. They said we are the pipe, a utility, and no one can work without us - which is true. But on top of that, we have customer intimacy. We have a lot of customers. We know what they need and what we can provide to them.”

According to Paul, being a utility is a double-edged sword for telecommunications providers. While everybody needs them – whether businesses, schools, individuals - they are nonetheless desperately trying to diversify, because the downside in terms of branding is that it’s hard to get excited about a utility. Paul notes that only very few tech companies, such as Apple, can command a ‘cool’ reputation as a consumer brand, and observes that another disadvantage is that utilities providers are only as good as their offering. Paul notes that benefits are swiftly forgotten, while mistakes leave a lasting impression. While the economic repercussions of the COVID-19 pandemic would have been much greater if huge percentages of the working population hadn’t been able to work remotely using fixed or mobile broadband, this has faded into the background of public consciousness – but consumers remember outages a few years ago suffered by Canada’s Rogers and Japan’s KDDI, as these interfered with the country’s emergency support services, causing huge damage to their brand reputations.

Retaining customer confidence is of course essential for any brand, and Dowidar believes reputations are best established – and kept - via innovation and disruption. He notes how LinkedIn has become the dominant recruitment platform, and WhatsApp has replaced SMS, and says that e& is expanding its offering – and therefore brand - to new customers by investing in new areas including enterprise cloud transformation, entertainment, cybersecurity, and a Super App business.

Dowidar notes that AI is a major driver of disruption and acknowledges that this will impact workers: “In the short term, there are jobs that are going to disappear, and that is because AI will be able to take over a lot of repetitive jobs… [for example] a technical job like optimising the network. We have engineers that work on the network; whenever there is a failure, they will go and change some of the parameters to keep the network going. Today, AI is able to do this in milliseconds without any intervention. Like any industrial revolution, there will be an impact for some time after that, the world will change again, and there will be new jobs.”

To facilitate the implementation of AI and reassure staff that they are valued, e& has appointed a Chief AI Officer to coordinate AI projects across the verticals of different departments. Dowidar notes that there are so many AI-focused projects underway that the role is necessary to avoid any duplication, but the role is also aimed at helping staff understand how AI can improve their jobs by removing repetitive work, providing them with opportunities to upskill in the best ways to use AI. There are a lot of risks associated with AI which must be quantified – having a team dedicated to coordinating and governing e&’s use of AI is essential to move forward.

Paul notes that there is an industry-wide shift as operators look to diversify and transition from telco to techco, and this presents an opportunity to implement a coherent branding strategy for the parent company and subsidiaries. He cites e& as a good example of this approach, as it has avoided the pitfalls of being labelled an ‘essential, but boring’ utility. Paul says that telcos need a brand strategy and approach that reflects their ambition and doesn’t restrict the direction and scale of growth.

This is backed up by Dowidar, who claims that e&’s embrace of disruptive technologies is a key factor behind its sustained growth over the past few years, and underlines his belief that these diverse investments should allow it to continue growing into the next decade. He adds that it’s just as important that staff are aware of this momentum and are encouraged to make bold decisions. Since the pandemic, many telecom companies have been fighting simply to maintain their position in the market – but it is through taking a different approach that e& has managed to drive growth.

To learn more about how operators are diversifying through rebranding and multibranding, click here to download our latest Special Report on this subject.

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