Choosing a business name is an important step when starting out – the right name can grow your business quickly, but the wrong name can lead to obscurity.
You want your name to reflect your business. Most customers will probably hear your name before choosing whether to get to know your business and products, so it’s important that your name makes a strong impression and reflects your values and brand.
When you’re choosing your business name, decide whether you want a name that signifies what you do or a name that generates interest so customers want to learn more. Deciding which route you want to go will help you decide whether you want a descriptive name or a unique, made-up name.
Choosing a Descriptive Business Name
Descriptive names are easy to think up and advertise. For example, if your business name is “Jane’s Donuts”, you don’t have to spend time and energy explaining that you sell donuts.
If you ever choose to expand outside of donuts, you might run into some problems because your name no longer reflects the full range of your business. Burlington ran into this problem because they sell more than just coats. They eventually changed their name from “Burlington Coat Factory” to “Burlington”.
It can also be tough to establish a competitive advantage through a descriptive business name. If a customer searches for donuts in their area, they might find Jane’s Donuts, Steve’s Donuts, and Mary’s Donuts. How will customers know which one is best? You can add a tagline to help establish that competitive advantage.
Choosing a Unique Business Name
Using a unique made-up name, like Zappos, can easily set you apart from your competitors.
Unique names are easier to trademark because the chances that someone else has the same or similar name are smaller. Because of this, it’s also easier to secure a domain name for your new business.
A unique name doesn’t always convey the purpose of your business, so you will have to spend time and energy advertising the purpose of your business. Once your brand is well established, customers will hear the name and immediately think of your business. For example, when you hear “Google”, you probably immediately think of the search engine.
If you want your business to describe what you do but also be unique, consider morphing words together – like Instagram or Netflix.