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What's in a Name? A Lot, Actually

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Naming a hospital or one of its departments after the donor who helped pay for it is fairly common. But what if the benefactor in question was not an individual philanthropist, but a corporation? Would you rename your hospital after a financial services firm or a toy maker? Would you name your emergency department after a clothing company?

Hospitals across the nation have done just that. On the East Coast, there’s the Morgan Stanley Children’s Hospital of New York-Presbyterian. On the West Coast, there’s the Mattel Children’s Hospital UCLA. In 2008, Columbus (OH) Children’s Hospital breaks ground on an entire campus that will be named for the Nationwide Insurance Company, which donated $50 million to the project. And the hospital’s ED? The Abercrombie and Fitch Trauma Center, named for the local clothing retailer that donated $10 million.

The Nationwide gift was one of the largest ever from a corporate foundation and the largest in central Ohio history, says Jon Fitzgerald, president of the hospital’s foundation. It far surpassed previous donations, which topped out around $10 million. Leaders and the community supported the name changes, Fitzgerald adds. “In philanthropy, everybody has their way of thinking and their process and their philosophy,” he says. “In our community, giving to Children’s is so ingrained that it’s seen as a very positive thing.”

There are pros and cons to naming your hospital, or even part of it, after a corporate donor. “Obviously you’re getting a large donation that allows you to further the activities of the hospital,” says Laura Feldman, director of grants project and policy for the National Association of Children’s Hospitals and Related Institutions. Feldman says such naming opportunities also represent “the ultimate in donor recognition.”

And the cons? “It’s a bad business decision,” says Jeffrey Nemetz, principal and co-founder of the Healthcare Branding Group in Chicago. “You do not control that company’s brand. The only one you control is your own. The minute you give up control you’re at the mercy of whatever happens within that company. ... If that CEO has an inappropriate relationship with someone in his office, if that CEO embezzles money, if there is a decision to close 50 stores … any number of things could fall into the purview of the operating model of your business that are none of your business and out of your control.”

“We’ve seen in the past decade that commercial enterprises have their ups and downs,” agrees Don Giller, senior project director for health and human services at BrandEquity, Inc., in Newton, MA. “There’s risk there … I would recommend that boards be cautious about this.”

Columbus’ agreement allows both companies to revisit the deal should something go wrong, Fitzgerald says. He adds that Columbus and Nationwide have a 60-year history together and that the insurance company has a reputation for serving families. “Our mission and their mission align. I think that’s very important. When we look at naming our entire organization in recognition of a gift, we carefully looked at who we wanted to talk to about this,” he says. “We thought it was a perfect fit.”

Thinking of entering into a naming agreement? Consider the following:

1. Choose wisely. Certain business sectors—think alcohol, tobacco, firearms—probably aren’t good prospects. “I don’t think you’re selling out if you work with a corporation, but I think you are selling out if you join with a corporation that threatens children’s health,” says Norida Torriente, assistant director of public relations for NACHRI.

2. Protect your brand. “In terms of branding, what’s most important is that an organization considers the impact of taking on a commercial name in terms of its own brand,” says Giller. “The brand is a significant asset.” To protect it, communicate to the public exactly what the naming means—and what it doesn’t. “This doesn’t indicate that the corporation has bought a piece of the hospital. Really, it’s been named in honor of the donation,” says Feldman.

3. Accentuate the positive. A large gift is evidence that the donor believes in and supports the recipient. Hospital leaders don’t always want to talk about money, but the bottom line is that with no money, there’s no mission. “I don’t want to say it was never about the money,” Fitzgerald says. “Always remember that it’s philanthropic giving. And all discussions should focus on the mission and the impact of the gift on the mission and what it will accomplish.”

—Gienna Shaw