In February when Moyock-based Blackwater Worldwide became Xe Services LLC, the question wasn’t what’s in a name. Branding experts say it was a matter of what wasn’t — a bad image. “They had what I’d call a brand crisis, and when a brand becomes so blemished, the only decision a company can make to keep in a growth mode is to rebrand,” says Clayton Tolley, president of Charlotte-based Addison Whitney LLC, which created such names as Escalade for Cadillac’s sport-utility vehicle.
Another Charlotte brand strategist agrees. “I’d say they wanted to come to market with a blank slate and build a new reputation around it,” says Jim Gregory Cusson, a partner in Birdsong Gregory LLC, whose clients include Food Lion. ”The name might be more palatable in foreign markets where I’m fairly sure nobody has a preconceived notion about it.”
Blackwater — northeastern North Carolina’s largest employer (cover story, June 2007), with more than 450 workers — has suffered a public-relations battering, particularly for its actions in Iraq. In September 2007, Blackwater security contractors guarding U.S. diplomatic personnel killed 17 civilians. Six face manslaughter trials, and its contracts — it had more than $1 billion in government awards since 2004 — were not renewed.
Xe spokeswoman Anne Tyrrell says the name was chosen because Blackwater is shifting emphasis from high-risk security details to logistics and training law-enforcement officers. The site of most of that training — Blackwater Lodge & Training Center in Currituck County — has become U.S. Training Center Inc. As part of the shake-up, CEO Erik Prince, 39, resigned as chief executive but will remain chairman. A new CEO hasn’t been chosen. President Gary Jackson, 52, retired. His replacement, Joseph Yorio, was a vice president of DHL delivery service.
As for the name, Tyrrell says, “Xe — pronounced like the letter ‘Z’ — was one of several considerations.” She says Xe is a nonword, chosen for its sound and look. Branders have a name for such choices: neologisms. Addison’s creations include ImaginOn, for a children’s library in Charlotte. Blackwater is following a beaten path for companies with jaundiced images. For example, ValuJet renamed itself AirTran after a 1996 crash in the Florida Everglades that killed 110. “You get rid of the negative association,” Tolley says.
As Blackwater, the company spent more than a dozen years establishing the brand worldwide. Now the name as well as the company’s logo — a bear paw overlaid with target-scope cross hairs — are gone. “Companies that lose are those that have spent five or 10 years and millions of dollars invested in promoting the brand,” Tolley says. ”They lose not only the bad image, but the good equity as well.”
What does Xe convey to an outside expert? “Absolutely nothing,” Cusson says. Tolley is kinder. “It’s short, memorable, the last word in the alphabet — it connotes power.”