£100m is what Easyjet founder Sir Stelios Haji-Ioannou might receive over the next ten years under the terms of an agreement that will pay him £3.95m next year, £4.95m the year after and 0.5 per cent of revenues thereafter for agreeing to allow the airline the use of the Easyjet name.
When he stepped down as boss Sir Stelios retained the rights to the ‘Easy’ name which he then used to start a number of other budget-priced businesses including car rentals and cruises. These have failed to fly in the same way, so to speak, and he has been feuding in recent times with the board over its expansion plans (as a shareholder he wants a dividend) and its use of Easy in what he claims are ancillary businesses and therefore his territory.
But money solves most things including court cases (as Liverpool FC and Messrs Hicks and Gillett may find in their court case starting today).
Even so £100m is a hell of a lot of money for Easyjet to shell out although newish CEO Carolyn McCall, formerly of the Guardian, points out that the rather smaller Virgin Blue in Australia pays Sir Richard Branson 0.5 per cent of revenues for its use of the Virgin moniker.
Couldn’t they have just called it something else?
That wouldn’t have got Stelios off their backs in the way this has of course (although the airline will still be restricted in how it uses the Easy name, essentially limited to flights). but at least he won’t be sniping from the sidelines so enthusiastically (or he says he won’t).
Many people, including most branding specialists, would say a brand equates to much more than a name. Which brings us back to the issue of renaming/rebranding companies.
When Guinness and Grand Metropolitan came together in 1997 to form global drinks giant Diageo everybody mocked but it doesn’t seem to have done the company any harm. But people don’t go into a pub or a shop and ask for a Diageo drink of course.
Orange and T-Mobile now like to be known, corporately, as Everything Everywhere but the company is keeping its two consumer brands, for the time being at least. You can see why.
But when Easyjet bought budget airline Go from British Airways (a sad day for budget airline passengers) it dropped the Go brand and seemed to cling on to the passengers. Did Easyjet consider dusting off Go (assuming it owns the name, it seems a bit careless about these things) and telling Sir Stelios to Easy off?
So names are pretty important, whatever the branding experts say.