Norwich Union name to disappear after 200 years in Aviva rebranding move

Aviva, the world's fifth largest insurance company, is to sever its ties with the 200 year-old Norwich Union brand in a major marketing exercise that will see it moving to operate under a single name worldwide.

Once the transition, expected to take two years, is complete, Aviva will trade under a single brand across all of its businesses bar two. The RAC roadside recovery unit it bought three years ago will retain its current branding, as will Delta Lloyd, its business in the Netherlands, where corporate governance regulations prevent a change of name.

The Norwich Union name will, however, disappear quickly, as will the Commercial Union brand, under which Aviva currently trades in Poland.

Andrew Moss, the insurance company's chief executive, would not say how much the rebranding will cost, but said the benefits would outweigh spending. "As we've become increasingly global, it is clear we need one name our customers can recognise wherever they are in the world," Mr Moss said. "By investing in a single name, we will amplify the global impact of our advertising and sponsorship spend."

Mr Moss said the rebranding reflected the increasingly international nature of Aviva's business. After a series of acquisitions and expansions in the US, Asia and continental Europe, Aviva now earns around 60 per cent of its revenues overseas.

However, the company will be acutely sensitive to a backlash in the UK, where its established brands have a long history and huge name recognition. Mr Moss described the Norwich Union name as part of the company's "treasured heritage".

Norwich Union, which has 35,000 staff and almost 23 million customers in the UK, was founded in the East Anglian city in 1797, and has until now retained its separate identity despite the formation of Aviva in 2002, following its merger with CGU, the former Commercial Union insurance business. Similarly, Hibernian, Aviva's Irish business, is this year celebrating its 100th anniversary, having been launched in Dublin in 1907. It has 2,200 staff.

Mr Moss yesterday moved to head off any suggestion that Aviva was abandoning its roots in Norwich, stressing that the city would remain its UK hub and that the rebranding would not mean any job losses. In addition, from the beginning of next season, the company will become the shirt sponsor of Norwich City football club, replacing the budget airline Flybe. The insurer said the deal was intended to underline its commitment to the city. Its £8m-a-year sponsorship of British athletics will continue, but under the Aviva brand.

Nevertheless, Aviva's move is not without risks. A string of companies in Britain and around the world have embarked on expensive rebranding exercises only to end up with egg on their faces. Some of these projects have fallen at the first hurdle. The accountancy arm PricewaterhouseCoopers was ridiculed when it floated the idea of renaming its consultancy arm Monday. The car manufacturer Mitsubishi fared even worse when it launched a new range branded Pajero, seemingly unaware that the word means "wanker" in Spanish.

Other rebrandings have failed for more strategic reasons. British Airways' decision to drop the union flag from tailfins on its planes undermined its status as the country's flag carrier – and attracted the fury of the then prime minister Margaret Thatcher. The move was eventually scrapped.

Peter Walshe, the global brands director of the marketing consultancy Millward Brown, said Aviva's rebranding carried risks and opportunities. "The opportunity to create one brand from several has potential, if Aviva can establish the name as clear, modern and, above all, standing for something," he said.

"The downside is that Aviva doesn't currently stand for much amongst many of the company's key audiences; it certainly means little to the consumer. The rebranding runs the risk of throwing away all the heritage, trust and prestige built up over such a long period."

That's a particular concern for a financial services company, especially during a period when customers are concerned about the security and standing of businesses handling their financial affairs. "The key will be to take time getting this right," Mr Walshe added.

Rebranding disasters

New Coke

In 1985, Coca Cola decided that after launching a series of products such as Diet Coke that didn't taste like the real thing, it would change the real thingitself. In a massive marketing exercise it tried to sell "new coke" as "the new taste of Coca Cola", only to suffer a rebuff from consumers who deserted it in droves. Coca Cola soon reverted to its old recipe, branded as "Classic Coke".

Persil Power

Launched in 1994, Persil Power sparked soap wars between its parent company, Unilever, and rival Proctor & Gamble, the producer of Ariel. But after Unilever had spent £100m on the product, P&G announced its tests showed the new brand was so powerful that itdestroyed the clothes it was supposed to be cleaning. Cue an embarrassing U-turn by Unilever.

Consignia

What could be more sacrosanct in branding terms than the PostOffice? Its management hasn't always seen it that way. In 2001, the company was rebranded as Consignia in an attempt to distance itself from its state history and claim a greater share of international markets. The public was not impressed with this attack on a British institution. The following year,Consignia had been dumped in favour of the more traditional, the Royal Mail Group.

BA

Margaret Thatcher had just one word for British Airways new tail-fin designs. "Awful", she declared, and draped her handkerchief over a model sporting one of them at a Conservative party conference. BA wanted to replace the Union Jack on all its planes with 50 new designs from around its world destinations. The scheme cost of £60m but was eventually limited to just 50 planes, before it was dropped altogether.

Sellafield

What to do if you're in charge of a nuclear power plant and a major fire breaks out, polluting the countryside with radioactive waste? Simple,said the managers of the Windscale plant in Cumbria. Rename it Sellafield. Unfortunately, the bad publicity did not go away.

Louise Dransfield