Naming a BusinessDefinition: The act of selecting a word or words by which your company will be known
What's in a name? A lot, when it comes to small-business success. The right name can make your company the talk of the town; the wrong one can doom it to obscurity and failure. If you're smart, you'll put just as much effort into naming your business as you did into coming up with your business idea, writing your business plan and selecting a market and location. Ideally, your name should convey the expertise, value and uniqueness of the product or service you've developed.
Unfortunately, finding a good business name is more difficult than ever. Many of the best names have already been trademarked. But with advertising costs and competition on the rise, a good name is critical to creating a memorable business image. In short, the name you choose can make or break your business.
There's a lot of controversy over what makes a good business name. Some experts believe the best names are abstract, a blank slate upon which to create an image. Others think names should be informative so customers know immediately what your business is. Some believe that coined names (names that come from made-up words) are more memorable than names that use real words. Others think most coined names are forgettable. In reality, any name can be effective if it's backed by the appropriate marketing strategy.
Given all the considerations that go into a good company name, shouldn't you consult an expert, especially if you're in a field in which your company name will be visible and may influence the success of your business? And isn't it easier to enlist the help of a naming professional?
Yes. Just as an accountant will do a better job with your taxes and an ad agency will do a better job with your ad campaign, a naming firm will be more adept at naming your firm than you will. Naming firms have elaborate systems for creating new names, and they know their way around the trademark laws. They have the expertise to advise you against bad name choices and explain why others are good. A name consultant will take this perplexing task off your hands--and do a fabulous job for you in the process.
The downside is cost. A professional naming firm may charge anywhere from a few thousand dollars to $35,000 or more to develop a name. The benefit, however, is that spending this money now can save you money in the end. Professional namers may be able to find a better name--one that is so recognizable and memorable, it will pay for itself in the long run. They have the expertise to help you avoid legal hassles with trademarks and registration--problems that can cost you plenty if you end up choosing a name that already belongs to someone else. And they are familiar with design elements, such as how a potential name might work on a sign or stationery.
If you can spare the money from your budget, professional help could be a solid investment. After all, the name you choose now will affect your marketing plans for the duration of your business. If you're like most business owners, though, the responsibility for thinking up a name will be all your own. The good news: By following the same basic steps professional namers use, you can come up with a meaningful moniker that works without breaking the bank.
The Process of Naming Your Business
Start by deciding what you want your name to communicate. To be most effective, your company name should reinforce the key elements of your business. Your work in developing a niche and a mission statement will help you pinpoint the elements you want to emphasize in your name.
Should your name be meaningful? Most experts say yes. The more your name communicates to consumers, the less effort you must exert to explain it. On the other hand, it is possible for a name to be too meaningful. Take the name "San Pablo Disk Drives" as a hypothetical example. What if the company wants to expand beyond the city of San Pablo, California? What meaning will that name have for consumers in Chicago or Pittsburgh? And what if the company diversifies beyond disk drives into software or computer instruction manuals?
Specific names make sense if you intend to stay in a narrow niche forever. If you have any ambitions of growing or expanding, however, you should find a name that is broad enough to accommodate your growth. How can a name be both meaningful and broad? Masters makes a distinction between descriptive names (like San Pablo Disk Drives) and suggestive names. Descriptive names tell something concrete about a business-what it does, where it's located and so on. Suggestive names are more abstract. They focus on what the business is about. Would you like to convey quality? Convenience? Novelty? These are the kinds of qualities that a suggestive name can express.
Before you start thinking up names for your new business, try to define the qualities you want your business to be identified with. If you're starting a hearth-baked bread shop, you might want a name that conveys freshness, warmth and a homespun atmosphere. Immediately, you can see that names like "Kathy's Bread Shop" or "Arlington Breads" would communicate none of these qualities. But consider the name "Open Hearth Breads." The bread sounds homemade, hot and just out of the oven. Moreover, if you diversified your product line, you could alter the name to "Open Hearth Bakery." This change would enable you to hold on to your suggestive name without totally mystifying your established clientele.
Begin brainstorming, looking in dictionaries, books and magazines to generate ideas. Get friends and relatives to help if you like; the more minds, the merrier. Think of as many workable names as you can during this creative phase. Professional naming firms start out with a raw base of 800 to 1,000 names and work from there. You probably don't have time to think of that many, but try to come up with at least 10 names that you feel good about. By the time you examine them from all angles, you'll eliminate at least half.
The trials you put your names through will vary depending on your concerns. Some considerations are fairly universal. For instance, your name should be easy to pronounce, especially if you plan to rely heavily on print ads or signs. If people can't pronounce your name, they will avoid saying it. That means they're less likely to tell friends about your company or to ask for your product by name. Nothing could be more counterproductive to a young company than to strangle its potential for word-of-mouth advertising.
Other considerations depend on more individual factors. For instance, if you're thinking about marketing your business globally or if you are located in a multilingual area, you should make sure that your new name has no negative connotations in other languages. Finally, make sure that your name is in no way embarrassing. Put on the mind of a child and tinker with the letters a little. If none of your doodlings makes you snicker, it's probably OK.
After you've narrowed the field to, say, four or five names that are memorable, expressive and can be read by the average grade-schooler, you are ready to do a trademark search.
Must every name be trademarked? No. Many small businesses don't register their business names. As long as your state government gives you the go-ahead, you may operate under an unregistered business name for as long as you like--assuming, of course, that you aren't infringing on anyone else's trade name.
But what if you are? Imagine either of these two scenarios: You are a brand-new manufacturing business just about to ship your first orders. An obscure little company in Ogunquit, Maine, considers the name of your business an infringement on their trademark and engages you in a legal battle that bankrupts your company. Or envision your business in five years. It's a thriving, growing concern, and you are contemplating expansion. But just as you are about to launch your franchise program, you learn that a small competitor in Modesto, California, has the same name, rendering your name unusable.
To illustrate the risk you run of treading on an existing trademark with your new name, consider this: When NameLab took on the task of renaming a chain of auto parts stores, they uncovered 87,000 names already in existence for stores of this kind. That's why even the smallest businesses should at least consider having their business names screened.
Enlisting the help of a trademark attorney or at least a trademark search firm before you decide on a name for your business is highly advisable. After all, the extra money you spend now could save you countless hassles and expenses further down the road.
After you've thought of some potential names, you should also compile a list of your competitors' names. If some of your name ideas are too similar to your competitors', remove them from your list.
If you're lucky, you'll end up with three to five names that pass all your tests. How do you make your final decision?
Recall all your initial criteria. Which name best fits your objectives? Which name most accurately describes the company you have in mind? Which name do you like the best?
Some entrepreneurs go with their gut or use personal reasons for choosing one name over another. Others are more scientific. Some companies do consumer research or testing with focus groups to see how the names are perceived. Others might decide that their name is going to be most important seen on the back of a truck, so they have a graphic designer turn the various names into logos to see which works best as a design element.
Use any or all of these criteria. You can do it informally: Ask other people's opinions. Doodle an idea of what each name will look like on a sign or on business stationery. Read each name aloud, paying attention to the way it sounds if you foresee radio advertising or telemarketing in your future.
Professional naming firms devote anywhere from six weeks to six months to the naming process. You probably won't have that much time, but plan to spend at least a few weeks on selecting a name.
Once your decision is made, start building your enthusiasm for the new name immediately. Your name is your first step toward building a strong company identity, one that should last as long as you're in business.