American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

Zomato to Eternal, Google to Alphabet, Facebook to Meta: why do companies rebrand and does it work?

by admin February 7, 2025
February 7, 2025
Zomato to Eternal, Google to Alphabet, Facebook to Meta: why do companies rebrand and does it work?

Zomato has announced it will change its corporate name to Eternal Ltd, marking a major rebranding move aimed at reflecting its growth beyond food delivery.

The company confirmed the decision in a regulatory filing on Thursday, stating that its board had approved the name change, though it still requires approval from shareholders and government authorities.

Despite the shift, Zomato’s food delivery brand and app will continue to operate under the same name, ensuring that customers see no change in service.

The move comes as Blinkit, its quick-commerce business, becomes a significant part of the company’s future growth strategy.

“When we acquired Blinkit, we started using “Eternal” (instead of Zomato) internally to distinguish between the company and the brand/app. We also thought that we would publicly rename the company to Eternal the day something beyond Zomato became a significant driver of our future. Today, with Blinkit, I feel we are there. We want to rename Zomato Ltd, the company (not the brand/app), to Eternal Ltd,” CEO Deepinder Goyal stated in a letter to shareholders.

Blinkit’s rapid growth fuels the rebranding move

Zomato’s latest financial results highlight Blinkit’s rising importance.

The quick-commerce segment saw revenue surge by 117% year-over-year and 21% quarter-over-quarter, making it one of the company’s fastest-growing divisions.

However, Blinkit also reported an EBITDA loss of ₹30 crore, compared to a ₹48 crore profit in the same period last year, along with a net loss of ₹103 crore.

Zomato acquired Blinkit, a struggling 10-minute grocery delivery startup, for $568 million in an all-stock deal in 2022. 

Initially, this acquisition was met with skepticism, causing Zomato’s share price to fall by 20%. 

However, Blinkit has turned out to be a significant growth driver. In April last year, Goldman Sachs said Blinkit’s implied valuation had exceeded Zomato’s core food delivery business, reaching $13 billion.

Grant Davidson, founding partner and head of strategy at Australian branding agency Davidson Branding, explains that one of the most common reasons companies change their names is to better align with their evolving business operations.

This type of rebranding helps consumers and investors gain a clearer understanding of a company’s current focus and long-term strategy.

“A name change often happens when a company’s original name becomes outdated or restrictive,” Davidson said, adding,

When a name has a geographic reference in it that is no longer relevant or limiting, when the name references a partner who is no longer with the company, or to better reflect changes in consumer trends. When fried food fell out of favour, Kentucky Fried Chicken had to change their name to KFC. When Google needed to create a brand bigger than search – they changed their parent brand to Alphabet.

Invezz takes a look at some prominent brand name changes in the history of international corporations and how they have fared:

Google rebranded as Alphabet to separate core business from new ventures

In 2015, Google restructured its corporate identity, renaming itself Alphabet and establishing a holding company that separated its core search business from its other ventures.

Google remained the primary internet and advertising division, while Alphabet became the umbrella organization overseeing various non-search businesses.

Explaining the decision, co-founder Larry Page described Alphabet as a way to streamline operations and give independent focus to different business units.

“This newer Google is a bit slimmed down, with the companies that are pretty far afield of our main Internet products contained in Alphabet instead,” Page said at the time.

“Good examples are our health efforts: Life Sciences, which works on the glucose-sensing contact lens, and Calico, focused on longevity. Fundamentally, we believe this allows us more management scale, as we can run things independently that aren’t very related.”

Analysts viewed the move as a strategic play to ease investor concerns.

Many shareholders had been wary of Google’s expansion into areas beyond search and advertising, fearing that experimental ventures were draining resources without generating significant revenue.

By restructuring, Alphabet could report Google’s financials separately, providing more transparency while allowing its experimental divisions to operate without impacting the company’s core valuation.

The strategy appeared to work, at least initially. Google’s shares jumped more than 6% in extended trading following the announcement.

Pivotal Research Group analyst Brian Wieser noted that the restructuring could unlock additional value, stating, “Perhaps there will be incremental value assigned to the totality of the new Alphabet because, undoubtedly, real value exists within the company’s emerging ventures.”

Within six months of the transition, Alphabet’s market capitalization had surged by $200 billion (£139 billion), nearly doubling the company’s total value—all while its core products remained largely unchanged.

Facebook changed its name to Meta to highlight focus on virtual reality

In 2021, Facebook rebranded itself as Meta to reflect its ambitions beyond social media and its growing focus on virtual reality and immersive digital experiences.

The name change applied only to the parent company, while its key platforms—Facebook, Instagram, and WhatsApp—retained their existing identities.

The move was aimed at positioning Meta as a leader in developing the “metaverse,” a virtual world where users can work, play, and interact through digital avatars, often using VR headsets.

However, coming on the heels of negative stories about Facebook, based on documents leaked by an ex-employee Frances Haugen who had accused the company of putting “profits over safety”, as well as the the leak of Facebook data to Cambridge Analytica, the rebranding was also seen as a move to dodge bad publicity.

Announcing the rebrand, CEO Mark Zuckerberg explained that the Facebook name no longer captured the company’s broader vision.

“The existing brand could not possibly represent everything that we’re doing today, let alone in the future,” he said, emphasizing the need for a name that aligned with its evolving priorities.

Since the transition to Meta, the company has focused on advancing virtual and augmented reality technologies.

It has launched the Meta Quest (formerly Oculus) VR headsets, introduced Horizon Worlds as a social VR platform, and collaborated with EssilorLuxottica to develop Ray-Ban smart glasses.

However, the rebrand has faced skepticism, with Meta investing billions into the metaverse without seeing immediate profitability.

Philip Morris became Altria to move beyond tobacco

In 2003, Philip Morris, the American multinational tobacco company, rebranded itself as Altria to reflect its broader portfolio beyond tobacco products.

The change positioned Altria as the parent company overseeing Philip Morris USA, Philip Morris International, and Kraft Foods.

At the time, Altria held an 84% stake in Kraft, which produced popular consumer brands like Oreo cookies and Oscar Mayer deli meats.

The company also had a minority stake in SABMiller, the world’s second-largest brewer and owner of Miller Beer.

While the official reason for the rebranding was to highlight its diversified business interests, industry experts suggested that the move was also aimed at distancing the company from the negative perception surrounding its tobacco products.

Philip Morris’s Marlboro cigarettes were widely associated with underage smoking, and critics argued that the company needed to separate its cigarette business from its food and beverage divisions.

Marc Thibodeau, author of Smoke Gets in Your Eyes, a book on cigarette marketing, described the name change as an attempt to build a “firewall” between its tobacco and consumer goods businesses.

“You don’t want any carcinogenic association with your macaroni and cheese,” he remarked, referring to Kraft’s popular food products.

He also pointed out that the name Altria carried connotations of altruism, aligning with the company’s corporate social responsibility efforts, including donations to the arts and public service campaigns.

Despite the rebranding, Altria remained a dominant player in the tobacco industry while continuing to expand its presence in other consumer markets.

Citigroup simplified its identity with the Citi rebrand

Citigroup rebranded itself as Citi in 2008 as part of a broader effort to simplify its brand identity and make the company more recognizable globally.

The name change was accompanied by a new logo and marketing strategy aimed at reinforcing Citi as a unified financial services brand.

The name “Citigroup” was long and somewhat bureaucratic. By shortening it to “Citi,” the company aimed for a more modern and approachable brand identity that would resonate with consumers and investors.

The rebranding aligned with Citi’s international presence, making it easier for customers worldwide to identify the company.

The iconic Citi umbrella logo, originally associated with Travelers Group (which merged with Citicorp in 1998), was retained to maintain brand continuity.

The rebranding came at a time when Citi was dealing with challenges from the 2008 financial crisis.

The move helped shift focus from the troubled “Citigroup” name, which was associated with risky financial dealings and government bailouts.

The post Zomato to Eternal, Google to Alphabet, Facebook to Meta: why do companies rebrand and does it work? appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
PLTR stock is soaring: but is Palantir really worth $255 billion?
next post
FTSE 100 forecast ahead of Barclays, Unilever, BAT, Coca-Cola earnings

Related Posts

Trump to sign executive order slashing drug prices...

May 12, 2025

Robinhood stock price has a 42% upside but...

December 29, 2024

JEPI vs JEPQ: Which is a better covered...

May 2, 2025

Pepsi and Delta say consumers are hunting for...

July 13, 2024

SoundHound stock price is soaring: more upside?

December 14, 2024

Can Nike’s new CEO and Jordan anniversary turn...

November 2, 2024

Electric air taxi maker Archer Aviation gets key...

June 7, 2024

World’s biggest 2025 IPO? CATL aims for $5.3B...

May 12, 2025

Lazarus Group Bitcoin stash hits $1.14B, 16% higher...

March 21, 2025

Asian stocks mixed ahead of US Fed decision:...

March 19, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Interview: Strategic location gives Brazil Potash cost advantage in domestic fertiliser market, says CEO Matt Simpson

      June 1, 2025
    • Canada’s Q1 GDP expands by 2.2%, driven by exports spike ahead of potential US tariffs

      June 1, 2025
    • President Trump to host farewell for Elon Musk as DOGE leader steps away

      June 1, 2025
    • UK’s digital banks face divergent fortunes: Starling stumbles, Monzo and Revolut soars

      June 1, 2025
    • Trump wants Apple to shift iPhone production from India to the US: here’s what it means

      May 18, 2025

    Categories

    • Business (3,022)
    • Investing (2,459)
    • Latest News (1,994)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved