Accenture: Rebranding a Global Brand

Q1. How would you characterize Andersen Consulting brand equity in the late 1990s? What factors and decisions contributed to the building of this equity? The late 1990s witnessed a surge of entrepreneurial risk-taking unleashed by the growth of the Internet. Andersen Consulting established its own identity with the adoption of its new name, Accenture, and a successful IPO, despite the bursting of the dot-com bubble. The company adjusted to new realities brought on by economic recession and the war on terror. Aggressive advertising made Andersens consulting widely known and respected as a leader in empowering other businesses to adopt technological solutions. They invested heavily in advertising and the investment paid off. In addition they employed a public relations firm to influence the opinions of upper level management who would be instrumental in the final decisions to choose Andersens consulting. One of their greatest sources of equity was in their educated and research based practices that produced superior results for their clients and for themselves. Andersen Consulting was known to be the market leader in management and technology consulting. Andersen Consultings status as an IT leader was a source of equity which aided its growth during the early 1990s. Other associations for clients and prospects included creative and innovative in developing applications, visionary and leader. In the end, the company wasnt known only for its technological capabilities, but even for its strategy consulting. By 1998, the company was the market leader in four major categories in consumer rankings of consulting firms: 1) Management and technology consultancy; 2) Operational strategic consulting; 3) systems integration; 4) Business re-engineering.

Q2. Compare the characteristics of Accentures brand equity to those of Andersen Consulting. Do you think rebranding and repositioning of the company successfully transferred the equity from the old name to the new one? The way that Accenture transferred brand equity from its original name to the new company name was by specially branding the new one, and looking at a new name as a fresh start, reintroducing itself to its customers, and the world. The new name allowed them to start fresh without the backdrop of a history; Accentures brand equity was more far reaching and all encompassing than Andersen Consulting. They had already begun to redefine themselves and their role in the businesses of their customers. It chose to help companies transition into the new economy. Andersen Consulting had an older business perspective that arose out of the detail

orientation of accounting. What they did was effectively transfer their new idea to customers, all the same time implanting their marketing strategy. An example of this was while advertising in the newspaper, and an anticipated new beginning at the start of the following year with a clipping on the bottom corner of their pages. Accenture used advertisement wisely as well as carefully identified the four characteristics that have an affect the marketing service. They were very successful in the transfer of equity because they have operated intelligently at every step. The leadership of Andersen Consulting knew the company and its strengths well due to their willingness to spend the time and money to research their impact and the perceptions of their clients. It was more than successful with an 11% increase in brand equity after the first year. . The separation from Anderson ended up being a good thing for Accenture.

Q3. How much of a competitive threat is IBM? How should Accenture best compete with them? From a competitive standpoint Accenture is one of the most globally recognized firms in the business. Due to the breadth of their business they face varied competition in multiple sectors. On the public front they have been facing increased competition from other multinationals like IBM, Infosys, Booz Allen and Marsh and McLennan. While IBM remains a huge competitive threat, Accenture must accentuate the factors which differentiate them from IBM. Those factors include a broader expertise in business goal attainment beyond technical expertise. In addition, Accenture has a long history of experience that IBM may not have matched even though they acquired Monday. (Acquisitions are not always able to transfer all the knowledge that they thought they bought.) Below is a comparison of IBM vs. Accenture stock positions. Factor Cheapness Growth Operations Balance Sheet CAPS Rating (P/E ratio) (5-year growth rate) (net margin %) (debt/equity ratio) (scale of 1 to 5 stars) Accenture 17.2 20.2% 6.86% .00 IBM 13.2 15.5% 13.65% 1.38

Source: http://www.fool.com/investing/general/2009/12/04/better-buy-acn-or-ibm.aspx

Round 1: Cheapness Advantage: IBM. Cheapness is determined by P/E ratio. The lower the better. Round 2: Growth Advantage: Accenture. Growth here is the trailing 5-year EPS growth rate. This trailing earnings growth helps put notoriously-optimistic Wall Street projections in perspective. Round 3: Operations Advantage: IBM. Net margin percentage shows how efficiently a company turns revenue into profit. The more similar the business models, the more relevant the comparison. Round 4: Balance sheet Advantage: Accenture. As with net margins, the debt to capital ratio is most relevant in comparing companies in similar industries. In this battle we give the nod to the lower-debt company, but attention should also be paid to the cost of debt, interest coverage ratios, and the stability of the business (the more stable a companys operations, the more debt it can safely carry).

Moreover, Accenture does not service small to midsize companies. Accentures one stop shop businesses model does not work for companies that may need help with only one business function such as IT solutions. Thus Accenture lose that chunk of the market to competitors.

Q4. Evaluate the effectiveness of Tiger Woods as a spokesman for the company. Is Accenture achieving its objectives with a celebrity spokesman? Until December 2009, Tiger Woods had been a celebrity spokesperson for the company. Go on, be a Tiger" and the ancillary statement "We know what it takes to be a Tiger" were effective taglines. Mr. Woods provided a big boost to Accenture when he became the companys worldwide public face in 2003. At the time, the Accenture name was less than three years old, and was still regularly called by its old name, Andersen Consulting. The campaigns initial theme was Go on. Be a Tiger. Mr. Woods was a powerful device for Accenture advertising. For six years Tiger Woods served as the centerpiece and metaphor for Accentures successful High Performance Delivered global advertising and integrated marketing campaign. Tiger Woods wasnt just used as a spokesperson, he was an integral part of the brands global marketing efforts the website, collateral materials, and internal communications were all branded with Tiger and the High Performance messaging. His achievements on the golf course have been a powerful metaphor for business success in Accentures advertising. The man personified the qualities that Accenture claimed for itself. His personality and winning ways were a good fit. But as allegations of Mr. Woodss extramarital affairs spread the company terminated Woods' six-year sponsorship deal on 13th December 2009 and removed references to Woods from its website.

Submitted by: Sneha Pradhanang 4th Year, Section: B Roll: 18