What's In A Name?

Naming a bank is a big business these days.

When Hudson Savings Bank and Westborough Bank merged last October, the new entity became Avidia Bank. The name, which is intended as a combination of the words “avid” and “idea,” may seem simple, but Ken Simms, the bank’s senior vice president of marketing, said it took five months, a specialized consultant, interviews with multiple bank directors and employees and a thorough survey of the competition, for the name to stick.

“It is quite a process, but it is very fulfilling, and we think we hit on a good one,” he said.

“A bad name can actually be a barrier for a business,” said Steven Smith, creative director at BrandEquity, the firm that worked with the new Avidia in its naming process. “What a good name will do … is it will be a gateway rather than a barrier.”

The issue of bank names has come to the forefront recently with the battle between TD Banknorth and Worcester-based Commerce Bank & Trust. After an acquisition, TD sought to begin marketing itself as TD Commerce Bank. But Worcester’s Commerce Bank — owned by David “Duddie” Massad — sought a judge’s order preventing TD from using the new name in Massachusetts, saying it trampled on their brand. So far, Commerce Bank & Trust has won the first round, with a judge granting a temporary injunction against TD in the case.

Function First

The squabble between TD and Commerce reinforces the value of a name in today’s competitive marketplace.

For Avidia, the need for a new name was simple, Simms said. The geographical boundaries implied in the Hudson and Westborough names no longer applied, and, in fact, the standard merger agreement that both parties signed promised neither name would survive the merger.

For the former Fitchburg Savings Bank, things were a little more complicated, according to President and CEO Martin Connors Jr. The bank changed its name to Rollstone Bank early this year because, over many years, it had reached a point where it was doing more than 70 percent of its business outside the city.

Besides, it was moving into investment services and developing a trust department, developments that made the “savings” part of the name increasingly misleading as well.

When it comes to branding, credit unions face the same problems as banks, plus some extra ones. BrandEquity’s CEO, Ted Selame, said that some people don’t really know what a credit union is and what it does. Fighting through that ignorance can be tricky. So some brands try to reposition themselves more as banks, like another of Selame’s clients, Brockton-based HarborOne Credit Union, whose new name is accompanied by the tagline: “Better Banking for Our Community.”

Philip Richards, senior vice president of retail services at I-C Federal Credit Union, said I-C’s board has considered a name change, largely because of the lack of popular understand of credit unions. The credit union actually did change its name once, Richards said, in the 1930s or 1940s when it shed the name “Immaculate Conception Credit Union.” Since then, he said, the board has repeatedly decided to stick with the I-C name because it is well known in the community. Richards said the most likely reason for a credit union to change its name is to expand outside its traditional region.

“The name IC might not mean anything” elsewhere, he said. “Here it means a lot to people. There’s a strong brand affiliation.”

And Richards said people who ask about the name provide an opportunity for the staff to explain the history of credit unions, which began as collective institutions often tied to a church or workplace, but now generally function more like banks.

Other credit unions have changed their names to reflect changes in eligibility for membership. AllCom Credit Union, based in Worcester, changed its name from Central Massachusetts Telephone Workers’ Credit Union in 2000 as it was expanding its scope to gain customers who don’t work for a phone company.

Debbie C. Guiney, AllCom’s president and CEO, said the credit union started by hiring consultants to help find the new name but gave up after they came back with meaningless names that incorporated words like “synergy.”

“They were names that we didn’t believe would reflect what our members wanted,” she said.

In the end, Guiney said, the credit union held a contest for its members to choose the new name, and ended up with AllCom. Guiney said the “com” refers to both the institution’s history in the communications industry and its new status as a community credit union.

Digital Federal Employees Credit Union made a more subtle change for similar reasons in 1999, when it dropped the “employees” from its name, said Tim Garner, vice president of marketing and strategic planning. Since then, he said, the Marlborough based credit union has moved informally toward greater use of the initials DCU.

Etymology Lesson

Once a bank or credit union makes the decision to change its name, finding the right one can be complicated. Connors said that before he and his staff settled on “Rollstone,” based on a local landmark, they considered several other names that turned out to be in use already. With the rise of Internet banking, he said, if any bank uses the same name, even if it’s across the country, it has to be eliminated from consideration.

Simms said the Internet is also important in another way. It’s important to find a name that translates to a simple, easily spelled, web address like Avidiabank.com.

“You don’t want a long, involved name, or a name that doesn’t readily come to mind when people are looking for you online,” he said.

Beyond the name itself, renaming is about rebranding. Simms said that, along with the Avidia name, BrandEquity helped the bank come up with new ways to distinguish itself. Of course, rebranding also means getting rid of the words and colors that long-time customers have grown used to. To make the transition as smooth as possible, banks and credit unions roll out the changes slowly. Linda L. Racine, executive vice president of banking and marketing at Rollstone Bank, said only a few customers were bothered by the name change.

“Everything went better than our expectations,” she said. 

Reporting by Mary Johnson from the Hartford Business Journal was used in this story.