Why BHP Wants You to Think Big

Resources giant BHP Billiton Ltd. [ASX:BHP] has decided that it’s time to go back to its roots. As of this week the company has dropped Billiton from their name as they aim realign with Australian values.

30 years ago BHP declared themselves ‘The Big Australian’. The sentiment however lost some of its charm along the way. Since the 2001 merger with the Anglo-Dutch Billiton ltd, the Australian public has become less keen on the big miner. In an attempt to fix this, BHP has been working on a rebranding exercise over the past 18 months. One that they hope will realign the company with the Australian values they once stood for.

TV and print ads, which will air as early as today, accompany a new tag line, ‘Think big’. The impression feels vaguer than ever. A line like think big, to me feels more fitting when worn by bold tech companies. More similar to Apple’s ‘Think Different’ or IBM’s longstanding association with just the word ‘Think’.

At a cost of $10 million hopefully BHP thought big on just how relevant the ads will be.

Geoff Healy, chief external affairs officer for BHP has openly backed the need for the campaign. Despite using a business-to-business model, Healy says a need to show empathy to the public is vital. He notes the lack of trust in corporations as a catalyst for the ads. And he suggests poor public image links to risking prospective capital.

What does this mean for ASX:BHP?

Handily, the campaign helps ease recent talks from US activist fund Elliot Associates. The fund has been pushing for change. Among its suggestions, demerging BHP’s US petroleum assets and listing those as a separate entity on the New York Stock Exchange. BHP rejected the proposals.

BHP has planned its new re-branding ads to be split into three stages. The first being the public relations side of things outlined today. The second and third segments should interest investors much more.

The follow-up aims to discuss the value BHP produces for shareholders and Australia at large. The final piece, which may be subject to change, aims to launch BHP onto the global stage. Beyond this opening three stage plan, the AFR believes there will be five additional milestones as the campaign grows.

How this will affect the share price as BHP undergoes the planned changes remains to be seen. What it does show, is that the company clearly values public opinion as it grows. Whether the $10 million price tag is justifiable will have to wait for the outcome.

Either way, though BHP’s roots might be in Australia, its future is focused abroad.

Regards,

Ryan Clarkson-Ledward

Junior Analyst


Ryan Clarkson-Ledward is an Editor at Money Morning.

Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects.

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