Broker Rebranding in 2021 - Will the Cost Worth It?

"Rebranding", self-evidently, is that a company changes its old brand name to a new one. "A brand is a resource that a company acquires to generate future economic benefits," a leading expert on brand valuation and brand equity practices, noted.

Rebranded Brokers in 2021

Throughout this year, Fazzaco has released a multitude of corporate rebranding stories, which includes 7 brokers.

January-2021: CMC Markets, a global leader in online trading, announced that its institutional division rebranded to CMC Markets Connect (CMC Connect), marking a shift in focus for the business as CMC Connect became a true liquidity provider in their own right.

March-2021: Admiral Markets, a leading online Forex and CFD trading provider, unveiled its rebranding to Admirals, indicating the firm's evolution to go beyond the traditional trading and investing sphere. It would expand its offering to include more products and services in and outside the financial markets.

In the same month, TP ICAP plc, a UK-based interdealer broker, confirmed in early March its re-registration as a private limited company and has changed its name to TP ICAP Limited.

Also, Marex Spectron, a UK-based broker, market maker, and clearer in global financial and commodities markets, announced its name change to Marex in late March. The firm believed that simplifying the its name and introducing a new logo was a clearer reflection of today's wider business mix.

May-2021: YJ FX Co., Ltd, a Japanese forex broker owned by Yahoo has been acquired by GMO Financial Holdings. Then in early September, the broker announced that it would change its name to "Foreign currency ex by GMO Co., Ltd" (Gaika ex by GMO). As part of this, new official website and e-mail address would be created.

November-2021: Vantage FX, an ASIC-licensed Forex and CFD broker has announced rebranding to Vantage, as part of its strategy of global business expansion. Dropping the FX from its name was an important development in demonstrating the firm's capabilities beyond forex, said the broker. 

At the end of November, the multi-asset brokerage platform LiteForex has rebranded to LiteFinance as the first step, so as to get licenses in new jurisdictions and thus develop its services further.

Costs of Rebranding

Rebranding is a marketing strategy, as well an investment in a company's future, in which a new logo, name, legal name will be created, and advertising themes will be updated. The cost will be up to the firm's size and the rebranding type.

Most SMEs can expect to invest $100,000 to $180,000 and six to eight months to transform their brand, according to Ignyte, a branding agency. Studies found that average B2B business spends about 5 percent of their revenue on marketing. With that in mind, an average rebrand will cost anywhere between 10 and 20 percent of a firm's marketing budget.

Regarding the type, Frontify, a cloud-based brand management platform, has clarified rebranding into 3 kinds, based on complexity, including:

• First, brand refresh. This is the most basic level, simply a sharpening-up of a company's messaging and visuals, partly to avoid it becoming outdated. It costs roughly $30,000–$50,000, and takes over a period of 3–4 months.

• Second, brand reboot. A booming company may quickly outgrow its initial brand identity due to the expansion of work force and corporate vision. This type is a great way to keep ahead in an ever-changing industry. A lot more research and strategic thinking are essential prerequisites. The costs are around $60,000-$80,000, and the time needed is approximately 6-8 months.

• Finally, brand overhaul. This is the type with the most complexity, the higher budget of roughly $100,000-$250,000, and the longer period lasting nearly 8-10 month. It is best suited for a global enterprise with multifaceted challenges, and a place in the industry.

Choosing a third specialized brand agency to partner with to rebrand will make the cost even higher. In the process, the branded assets include marketing materials, URL, clothing, correspondence need updating. Moreover, it's of great significance to market the new brand and the connotation in the first 6 months after rebranding. Whereas, Forbes noted in a reported in November that most companies underestimate the investment (including time and capital) required to communicate and advertise their new brand.

​A Cost-effective Step Forward

Generally, companies have rebranding cycles, so as to stay current or to set themselves ahead of the competition. Rebranding indicates a new growth stage, or the reposition of development. As such, this is crucial to a firm's long-term survival and market leadership.

From the above press releases, we understand that brokers implemented rebranding strategy so as to achieve certain development goals, including business expansion or reposition, global expansion, company type change, etc.

Looking at the reasons behind the rebranding strategies this year, it is not difficult to discover the trend that an increasing number of brokers are diversifying their business and pursuing global expansion to go beyond Forex and CFDs trading.