FedEx Ditches Kinko's

When FedEx acquired printing chain Kinko's in 2004 for $2.4 billion, the air-cargo shipper's grand plan was to integrate the 1,200 stores into its business-services offerings. The goal was a digitally linked network of one-stop stores for customers to make, print, pack, and ship anything. A new name and logo, designed by Landor Associates in San Francisco, merged the two identities into FedEx Kinko's and added a multicolored icon, known as the beacon. But now, four years later, FedEx is ditching Kinko's for the more all-encompassing "Office."

"Kinko's is a wonderful brand, and it's nostalgic," admits Gayle Christensen, director of global brand management for FedEx (FDX). But it was also limiting—at a time when technology is transforming the quick-print business and as FedEx expands its offerings at former Kinko's outlets to digital printing services, direct mail, and more creative jobs like signs and banners. The name FedEx Office, also devised by Landor, "gives us permission to offer new services because Kinko's was so associated with copies," Christensen says.

The name change doesn't come cheap. In announcing the move to shed the Kinko's brand, Memphis-based FedEx also said it would record a charge of $891 million in its fiscal fourth quarter, including $515 million in a noncash impairment charge, which "reflects the current fair value of the FedEx Office unit in light of current economic conditions, the unit's recent and forecast performance, and the decision to reduce the rate of store expansion," according to a company press release.

Struggling Financially

FedEx doesn't separate financial results for its Kinko's unit, but according to media reports, Kinko's had been struggling financially. A spokesperson declined to comment further on the writedown. In March, FedEx Kinko Chief Executive Ken May resigned, shortly before the company announced a fall in profit for the second straight quarter due to rising fuel costs and the economic slowdown, which had reduced demand.

Discontinuing use of the FedEx Kinko's name isn't a great loss, say design experts. While Landor's Web site describes the name as a way to leverage "the equity of two strong brands," Debbie Millman, president of the design division at Sterling Brands in New York, describes it as "a slapped-together combination that didn't convey originality or engage the public imagination." FedEx Office is far more descriptive and allows the company to leverage the overarching meaning of the word "office," according to Millman. (Officials at Landor were not available to comment.)

In fact, that's the game plan as FedEx slowly rolls out the new name at FedEx Kinko's retail outlets over the next few years, and goes ahead with plans that were already in place to create large-format stores. "The name change reflects that we serve as the office on the road for traveling professionals, a branch office for medium and large businesses, and the back office for small businesses," says FedEx spokeswoman Jenny Robertson.

FedEx brand chief Christensen says the change reflects an evolution of the name rather than a major overhaul or rebranding, noting that 70% of the original FedEx Kinko's logo, including the icon, remains intact. Landor again stepped in as design consultant, coming up with a list of possible names, which Christensen declined to detail. The decision to drop Kinko's was based in part on consumer research that showed customers now know about the wide range of services FedEx offers. "That would not have been possible four years ago," Christensen says, referring to the Kinko's acquisition and the need at the time for the co-branded name.

Kinko's Curly-Haired Founder

Kinko's was named after its founder, Paul Orfalea, whose nickname was Kinko because of his curly hair. When Orfalea started the company in the 1970s, to service students at the University of California at Santa Barbara, the name stuck. And over the years, Kinko's kept its laid-back reputation. It was a place where you would invariably find big, noisy copy machines, piles of paper boxes, and sometimes sleepy employees, especially late at night in the middle of a copy emergency.

In 1996, Orfalea sold a stake in Kinko's to private equity firm Clayton, Dubilier & Rice, which started cleaning up the company's act. Clayton, in turn, sold the company to FedEx, which continued overhauling Kinko's, investing in new branches and technology and retraining staff.

But the arrival of cheap printers and PDF files made the concept of the corner copy shop, and tackling projects like binding hundreds of copies of a big report, largely irrelevant. That meant the Kinko's brand was destined to go the way of BetaMax and Atari, which didn't survive technological advances.

"The Kinko's brand wasn't elastic or evocative enough to move into the 3.0 economy," notes Brian Collins, chief creative officer of Collins:, a design and branding company in New York. "It is too grounded in analog thinking." By comparison, "Office" is rich with meaning and more utilitarian. "An office is the place where work gets done, a laboratory to invent things, a place to go create," Collins explains. FedEx Office, he adds, "sounds like it could be a software system."

Despite the demise of the Kinko's name, there still might be a place for it in the FedEx universe. "Maybe we could use it in a minor way somewhere in the store," Christiansen muses, noting that the company still owns the name. "Perhaps we could label the copiers Kinko Copiers."

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