Can Telstra make its rebranding work? Expert says changes must be matched by internal restructure

Telco giant Telstra will attempt to rebrand itself as it undergoes a massive internal restructure, adopting a new colour pallet for advertisements as it tries to stop the wave of customers leaving to other telcos and restore its image as a dependable service provider.

However, experts suggest it may not be so easy to persuade consumers, who for years have complained of lengthy and complicated billing processes and inadequate services.

“By all means, update your look and feel. But the word “rebrand” is a dangerous one to use because brands don’t change,” Brandology managing director Michel Hogan says.

“They certainly evolve and move in steps, but that only moves if the principles and practices that drive the brand keep changing as well.”

Telstra announced its rebranding strategy yesterday, one of the biggest corporate shifts in recent years and the most dramatic for the company since overhauling the Telecom brand in 1993. It announced a number of new advertisements yesterday for television, newspapers and online, which feature the Telstra logo and text draped in one of a series of colours.

The rebranding is set to occur over the next two years. Telstra has continued to use the “it’s how we connect” slogan, although it has added a few others into the mix as well.

“The slogan was the first step in creating a new brand image for the company, one that reflected the changes we’ve made to our customer service and product range over the past two years,” creative director Mark Collis told the Australian Financial Review.

Chief marketing officer Mark Buckman has also stated the company’s goal is to change the way people think about the company – “we needed to send a clear signal that Telstra has changed”, commenting that previous advertising was “schizophrenic”.

“This new strategy will put an end to that and ensure there is a consistent look and tone to Telstra ads.”

Ad giants DDB and Interbrand came up with the new strategy.

However, Hogan says Telstra still suffers from a huge amount of complaints. Many of these target the company’s billing procedures, along with various other telco-specific complaints such as bill shock.

“You’ve got to fix your billing processes. That’s how a brand changes, you need to change the things that people hate,” she says.

“The problem with the billing procedures is that they aren’t wrong just once, they’re wrong month after month after month. And that’s not just Telstra, that’s all telcos and that’s the reason people hate them so much.”

Hogan says unless companies are fundamentally restructuring themselves to fix those issues, “then you aren’t really doing anything except busy work”.

However, Telstra chief executive David Thodey has been pushing a massive restructuring effort over the past year, including a number of changes such as reducing headcount, merging divisions and attempting to introduce new billing procedures to have complaints handled faster.

Hogan says the telco giant needs to continue to restructure and make sure tangible changes to customer service complement the marketing rebrand.

“The brand is the result of everything the company is doing, and not just one singular thing. If they want a different result, they’re going to have to continue internal changes.”

“It’s extremely difficult to change a brand like this. But it can be done – it’s not impossible.”