That depends on who you ask and what you are asking them. Some will tell you “it doesn’t matter what you name your business or product” while others will tell you that it is “the most important decision you will ever make.” While there is validity in both, here are some things to consider the next time you are thinking about a name.
Using the family name. This is probably the most common approach out there. It is the easiest to come up with, gives you reason to put personal pride into it and it can help if your clientele is local or you are well known. Dave Thomas named his restaurant after his daughter, Walt Disney gave his business his full name and the Wegman family uses their family name for their family run business. All of these famous examples are positive ways that using a family name has been successful. Some stories are not so.
The last statistic I heard was one in five businesses do not make it past their fifth year. By having your name attached to the business, it can look like a failure if you do not make it and have a negative effect on your personal reputation. Also, what if someone who has the same name as you/your business commits a crime? Regardless of if you are related or associated with them or not, you have to do damage control to protect your brand-because perception IS everything. Don’t believe me? Do some research on identity theft and apply those stories to business owners. It can and unfortunately does happen.
Naming the business or product after the competition. This is a great way to get instant recognition. The name will be familiar to the market and make people more willing to trust you. The downside is the same as the perk. If your competition screws up, closes their doors or changes their business model, the perception of your company also changes. By taking this approach you are also putting yourself in a position where you constantly have to advertise so people know the difference between ‘C-Solution’, ‘Solution-C’ and ‘C-Solutions.’ Who should they call again? And why are they calling you instead of them?
Stating the business service or product in the company name. There is value in this as well. It helps a prospect know right off the bat the name of your company and the service you provide without a doubt (unless you use industry jargon, then that is a whole other Sonus Complete story). This is very helpful if you are in an industry that people need but do not know anything about. It is also good because of how search engines work and attracting online traffic to your site. American Airlines, MapQuest and Petco are examples.
The downfalls, I feel far outweigh the positives for this one. While the initial comfort that is provided to the prospect is good, it limits you to what services and products you can offer successfully and can limit how much you can grow. At Cindy’s Cookies, a prospect would be expecting a variety of cookies and perhaps other baked goods. Cindy would have a hard time selling pots, pans, appliances or towels. While those elements are a part of the kitchen, a prospect going into Cindy’s shop is looking for already made goodies, not necessarily the supplies to make them. It also creates a generic perception. How many companies can you name that have ‘technology’ or ‘consulting’ attached to it? What do those words mean anyway?
Using an ambiguous name. This is a great way to stand out from your competition. A unique name, which no one else in your industry has, makes you memorable. It also allows you to modify your business model as you see fit in any way you see fit, because you are not verbally confined. The name can be catchy, it can have hidden meaning or it can even be an acronym for something. Nike is the goddess of flight; NASDAQ stands for the National Association of Securities Dealers Automated Quotations, Starbucks is named after the first mate in Moby-Dick, Sony is a made up word derived from the American word sonny and the Latin word sonus, and Google is a really big number (10 100).
Like with anything else, this has its downfalls. Taking this approach could mean market rejection, the name could be too complicated to remember or say, and there is a good chance that more marketing and advertising will be required up front to help the market understand and know that you are around.