For MagnaCom Corp. President Steven Weinstein, finding a new moniker for his fast-evolving communications company was tougher than deciding with his wife on the names of their kids.

That isn't unusual, since changing corporate names midstream involves an in-depth understanding of your company's place in the market, what it will be in the future, and how it should project itself. Until companies go through a naming exercise, many of those questions aren't fully thought through.

"Figuring out a name is a way to figure out what to do next," says Tom Klinkowstein, president of Media Arts Inc. in New York, who helped Weinstein's team. The process, led by a group of 10 to 12 people, stretched on for roughly nine months and involved input from 50-odd employees.

Changing a business name is such a dramatic step that it shouldn't be considered unless all other alternatives have been exhausted. Doing so tinkers with the awareness of your brand -- one of the most valuable assets you have. "There are risks, costs, and potential complications," cautions Jim Johnson, CEO of the corporate identity consultancy Enterprise IG Inc.

Weinstein's team was aware of the risks, but he knew something had to be done. His New York company was founded five years ago as a broadcast fax business, serving the mortgage banking industry. It's name: Fax Focus. Says Klinkowstein: "The name itself was not visually engaging, interactive, or theatrical." Plus, the company had expanded from its original mission through a string of acquisitions. It was now offering fax-on-demand, interactive voice response, broadcast E-mail, and point-and-click Web fax products -- all described as "unified messaging solutions."

"We were building up a portfolio of companies with proprietary communications technologies, knowing that the sum total had to be a complete service package that had a 'next' feeling about it," says Weinstein. "We needed a name that could fit our role as a pioneer of truly integrated, two-way, custom communications." Fax Focus also carried too much baggage for the sales team to work effectively. "They were having trouble with the 'fax' name, when what they were selling was a lot more -- true messaging products," he says.

COOL CATS. Once the process got under way, Weinstein says Klinkowstein came up with several good names and a few wild ones. "We're still getting laughs out of one name we got in the process -- 'Catnip.' This was supposed to signal that we were Silicon Alley, new wave, and hip," Weinstein says. Eventually, his team settled on MagnaCom, the name of a company it had acquired. The new moniker, meant to portray a large, diversified communications company, took effect in early December.

In reassessing his company's ID after a string of deals, Weinstein was not alone. Enterprise IG says that by July, 1998, name changes of public companies in the U.S. reached a mid-year record of 995, with 54% of the businesses motivated by such changes as mergers, acquisitions, and divestitures.

How does the process work? Klinkowstein says his first step is to discuss the client's business goals, explore its "stylistic preferences," and then come up with a list of potential names. "Clients often underestimate the time and expense needed to do the job well," he says.

Johnson at Enterprise IG, which has created such names as NationsBank, Citibank, and FedEx, advises "a plain-speak name that can describe the brand positioning you have." The same principles apply to small companies and large ones, he says.

How much does the process cost? Klinkowstein says a small company should budget $25,000 to $75,000, excluding the cost of changing legal papers, stationery, marketing materials, and the like. The expense could go much higher if assets like a fleet of trucks, uniforms, and other branded materials are involved. For large companies, the tab runs into the hundreds of millions of dollars, Johnson says.

"We considered the cost, but it had to be done," Weinstein says. (He declined to release any figures on what he spent, however.) With technology, it was relatively easy to transmit information and standardize the company's image and brand. Weinstein did say, however, his hand ached from signing multiple state forms for the name change. Still, it was worth the personal discomfort -- and the agonizing that preceded it. Weinstein says: "We viewed this as critical in pulling together as a group." For a fast-mutating business, that's no small dividend.

By Samuel Fromartz in Washington, D.C.

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