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Ugodre Talks Figures: How Unilag can lose billions of Naira due to name change

As some guy put it on twitter, the brand name of some of these schools is probably the only value they can hang on to considering that the schools lack proper infrastructure, lecturers, and a modern environment that can compete in the 21st century.  

“If this business was split up, I would give you the land and bricks and mortar, and I would take the brands and trademarks, and I would fare better than you.”

— John Stuart, Chairman of Quaker (ca. 1900)

The importance of a brand name in any human endeavour cannot be over emphasized. Just the same way consumers are attracted to products and services offered by notable brands, tertiary institutions the world over have been known to attract students from all over the world on the basis of their name. Like corporates, brand names for universities derive their worth from decades if not centuries of impacting knowledge on students who turn out to be successful businessmen, political and spiritual leaders, role models, etc. The universities conversely benefit from this set of people who remain its alumni’s often donating large sums in endowments, making a huge name for themselves in areas of commerce and politics, etc.  It is in this light that the renaming of the University of Lagos by the GEJ Administration becomes interesting. Just how much will the school lose in the short to medium term and lose in the long term?

Is there a brand value?

University of Lagos has been in existence for over 50 years and has for decades been one of the most notable universities in Nigeria. It has graduated hundreds of thousands of students over the period and has an alumni organisation that resounds well with the prestige and integrity of the school. The school also sits on arguably the most expensive piece of land any institution in Nigeria and probably the whole of Africa. With a land size of over 100,000m2 (my estimate) one can ordinary put the value of the school based on land alone at about N15b. UNILAG as a brand name is probably worth much more as intending students rely as much on a name of school as much as they do with its academic qualities and infrastructure. But estimating that brand name can be somewhat impossible. However, a recent JP Morgan research estimate that brand value contribute as much as one-third of its shareholders value. How that can be translated to non-profit ventures like federal or state universities is up to brand valuers. But one thing is for sure, the name “UNILAG” sure has a brand value and that may be worth billions.

What is the cost of the name change?

It is probably impossible to accurately estimate how much the school may have lost by losing the name “UNILAG” and incurred by changing it. According to some brand managers, the school is set to spend between N1b to N2b in its rebranding exercise. Add that to the value lost in changing the brand name and we could be talking of over N10 billion. Think of it this way, if UNILAG were to be privatized and sold off, would willing buyers pay the same amount of money for it if it were called ‘UNILAG” as against “MAULAG”?

‘Surely, not,’ you must would think, which buttresses that fact. Naming UNILAG after a great man like MKO Abiola may have been a sincere move by the president, but in doing that he has inadvertently lost tax payers a future intrinsic value that may have been derived from the sale of school if that ever happens. The value in the name of a company be it government owned or private is so powerful hardly is the name changed for any reason.

Flashback to Government enterprises that have been privatized, there have been very few that has been renamed. Even when renamed, that is after years of careful brand transformation which more or less does not even result in killing the original brand name. In the immediate future though, the school may also have to contend with the potential loss of intending undergraduates and post graduates who may wish to seek for other schools with better brand names which they can leverage upon.

As some guy put it on twitter, the brand name of some of these schools is probably the only value they can hang on to considering that the schools lack proper infrastructure, lecturers, and a modern environment that can compete in the 21st century.

Who stands to gain or lose?

For the neutrals in all of this, there is little concern about how the renaming of a school affects their everyday live. But for the present Government, there is a lot to be gained at least in the short term. Though not financial, politically they have surely scored a cheap point against the opposition who are obviously morally bankrupt to support or go against the renaming of the school. After all they have for long been requesting that the democratic icon be remembered for his sacrifice to the country. Ironically, we all know that the day “June 12′ being commemorated as a public holiday will be the greatest respect they wish to be bestowed on MKO. Another beneficiary may well be the state owned University, Lagos State University, who have suddenly now seen themselves hold on to the nomenclature of “Lagos” and “University” without much contest from anyone.  They, I suspect may now be referred to as “Lag” just as they are referred to as “LASU” in popular culture.

The losers in all of this may well be the school (UNILAG) itself. Not only do they lose the brand value attached to the school they also stand to lose several sums in endowment from the school alumni if they are not able to derive value from the new name sooner rather than later.

What Next?

It is up to the National Assembly to either ratify or disapprove of the name change. In Nigeria, anything is possible as the chances of ratifying have as much odds as cancelling it. The students may groan all they want they only need to remember that the school belongs to the Federal Government (FG) and not them. The FG may decide to call the school whatever name it so wishes. For the students, their power lays in their choice at the polls and off course in an undeniable right- the right the move on to “greener” pastures.

Visit Ugo’s blog HERE.

 

Editor’s note: Op-ed pieces and contributions are the opinions of the writers only and do not represent the opinions of Y!/YNaija.

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