Adelaide-based home lender, Tic:Toc Online, says it is not considering plans to rebrand its business to avoid possible reputational fallout from the diplomatic controversy involving the Chinese-owned video sharing platform known as TikTok.
While the local lender has no association with the similarly named Chinese company, there is a potential risk that it could suffer inadvertent brand damage if the international furore over TikTok escalates.
A spokesperson for Tic:Toc Online told Banking Day that the Australian-owned lender had not detected any brand confusion within its customer base and the company had continued to expand mortgage volumes.
Tic:Toc Online is a digital mortgage lender founded in 2015 by its managing director, Anthony Baum.
Bendigo Bank is a key shareholder and provides funding lines for the business. Other investors include Genworth and Insurance Australia Group.
The international storm surrounding China’s TikTok has intensified since June when India’s Prime Minister Narendra Modi banned the platform after he alleged it was being used by the Beijing Government to spy on Indian citizens.
In August, US President Donald Trump ordered TikTok’s owner ByteDance to sell its American business to a US company or face having its operation shut down.
Trump justified the move by claiming that TikTok was sharing data about its international subscribers with the Chinese Government.
While members of the Australian Defence Force were recently banned from accessing TikTok on digital devices, Prime Minister Scott Morrison said last month that there was no evidence to suggest that Australia’s security interests had been compromised by local use of the platform.
However, Morrison warned Australian users that there were risks that their personal data could be shared with the Chinese government.
Leading Australian brand experts believe Tic:Toc Online is well positioned to shield its image from possible collateral damage mainly because it is a regional brand operating in a product market that is discrete from TikTok’s social media business.
Paul Nelson, the founder and managing director of BrandMatters, a Sydney-based brand consultancy that advises financial services companies such as Suncorp, said he believed the identities of the two companies were visually distinguishable.
“I’d be more concerned if there was a “TikTok” financial services company that was pulled up by ASIC or APRA,” said Nelson.
“The cost of rebrandings are pretty significant – I don’t think it’s a decision I would be taking lightly.”
However, Nelson said that Tic:Toc Online might need to address a potential brand clash in the minds of some customers by making it clear on its website that it has no relationship with the Chinese company.
“That’s what I would be saying to them,” he said.
“It’s hard to build equity in a brand only to have the brand ‘vampired’ or contaminated by another business.”
Award-winning brand specialist Jane Anderson concurs with Nelson, saying the potential for clashes between global and regional names underlines the importance of companies investing in brand equity.
“I don’t think there’s as big a risk as might appear for Adelaide-based Tic:Toc because the two companies are operating in different industries and appear to have different customers,” Anderson said.
“However, it highlights why companies have to invest in brand equity particularly in the local markets they are focused on.”