You Are the Brand

Blackwater Changing Your Name Doesn’t Fix Your Reputation

Sometimes, a brand has to rebuild itself. Sometimes a new name is necessary. Sometimes it’s worthwhile to start all over again. Sometimes , however, this approach to improving the company brand is a bad idea—a very bad idea if the company has been involved in an egregious or embarrassing incident and then tries to rebrand simply by coming up with a new name. Take Blackwater Worldwide, for example. This private security company was founded in North Carolina in 1997 by its chief executive Erik Prince, along with a group of fellow Navy Seals. Blackwater (whose name came from the murky water that runs through the swamp land of North Carolina) built its brand as an organization that could achieve things on the battle- field that no one else could.The company got government contracts that no one else could get to do work that few others wanted to do. While few understood how Blackwater was able to achieve things that the U.S. military couldn’t, not many questions were asked about its methods or practices. But all that changed in 2004 when four of its contractors were killed when insurgents in Iraq ambushed them in Fallujah.The bodies of the Blackwater contractors were burned, mutilated, and hung from a bridge for all to see in worldwide media coverage. Those visuals outragedAmericans, who began asking questions. What was Blackwater? What did it do that the military couldn’t or wouldn’t? How could its contractors be put in such a vulnerable position to be made into pawns by Iraqi insurgents? With these questions still not answered to everyone’s satisfaction , in September 2007, there was a shooting in Baghdad that tarnished Blackwater’s brand even further. Simply put, the folks at 105 Blackwater Changing Your Name Doesn’t Fix Your Reputation Adubato_(Brand)_final 4/11/11 11:29 AM Page 105 Blackwater engaged in a firefight that resulted in the deaths of at least a dozen Iraqi civilians. This kind of unintentional tragedy in war is often called “collateral damage,” and although understood to be an unavoidable evil of war, in the case of Blackwater, the brand damage was significant.The news of this event was confounding to the American public because, again, no one questioned what private contractors, retained by the U.S. military, were doing in the middle of a war in Iraq in which they had no official part. The 2004 incident involving the killing, mutilating, and burning of four Blackwater contractors in Fallujah was bad, but combined with the 2007 killing of Iraqi civilians, the company hit its tipping point. Congressional hearings ensued and members of Congress questioned Blackwater’s training methods and investigated how exactly the company worked officially and/or unofficially with the U.S. government and military. Many in Washington called for Blackwater to be banned from any military operations in Iraq, and the State Department refused to renew Blackwater’s contract to “protect diplomats” in the Middle East. Blackwater was out. The company was blacklisted.The brand was tarnished so severely that the thought of a comeback was inconceivable. What’s Xe? So what did the company execs do when the brand hit rock bottom ? They acted as if the incidents never happened. They decided simply to change the company name and start over. They called themselves Xe. That’s right. Blackwater became a new company overnight with the indecipherable name that is pronounced like the letter “z.” Further, what was known as the Blackwater Lodge andTraining Center was renamed U.S. Training Center, Inc. (the use of “U.S.” implying, or making it seem, that the U.S. government was involved ). This branding switcheroo fooled no one. According to Katy Helvenston, who sued Blackwater after her son was killed in the Fallujah incident, “They have established themselves as the bad guys. . . . They’ve established such a horrible reputation. Why else would they change their name?”1 106 YOU ARE THE BRAND Adubato_(Brand)_final 4/11/11 11:29 AM Page 106 However, according to then-Blackwater president Gary Jackson , the new names reflected the change in the company’s focus: away from the business of providing private security. Said Jackson in 2007: “The volume of changes over the past half-year have taken the company to an exciting place, and we are now ready for two of the final, and...