Initials, Brand Names, and Stock Prices

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by: Ilya Vedrashko

Two articles in one week on the same interesting subject: the influence of brand initials on brand image.

Al Ries at AdAge about J. Walter Thompson switching to JWT: "It is almost impossible to create a separate perception for a set of initials. Rather, initials tend to remind people of the names they originally stood for. When consumers see a KFC sign, they tend to think "Kentucky Fried Chicken" in the same way seeing "GE" conjures up "General Electric" or "IRS" the Internal Revenue Services. When a consumer sees a set of initials, his or her first reaction is: "What do those initials stand for?" And if they don't stand for anything, the consumer is unlikely to remember them.

Wall Street Journal (via The Frontal Cortex): "For at least two years, Harley-Davidson Inc.'s investor-relations folks had thought about it: Their ticker symbol, HDI, wasn't exactly evocative of the motorcycle maker's image. And there was something better available: HOG, biker-slang term for a Harley motorcycle. Something surprising has happened since Harley-Davidson adopted the symbol in mid-August: Its shares have gained nearly 16%, compared with about 4% for the Standard & Poor's 500-stock index."

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