How to Name a Business

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To name a business, consider using abstract names that allow for growth, functional names that tell clients about the product, or names after the founder. Geographical names can also be used when naming a business with advice from a business management consultant in this free video on business.

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Video Transcript

We're here to talk about how to name a business today. Now, what's in a name? Well, quite a lot, really. A good name can give you the a "Stairway to Heaven", and the wrong name can be "The Road to Hell", to quote Led Zeppelin and Chris Rhea. You can use abstract names for a company, or ones that are more specific. Obviously, an abstract name gives you a kind of blank slate on which to write your company's values, its proposition, what it offers, the service, the benefits, and so on. Specific names can also be used, but can, of course, tie you down if your company business changes. There are no hard and fast rules about which to use, but let's look at some common ways in which people do name companies. Firstly, let's look at naming a company by function, what the company does, or the benefit that it creates. It's always better to think about naming a company not by what it does, but but the benefit it creates for customers. If you look at your washing machine it has many functions on it, but only you have use certain functions to create the sort of benefits you desire for the types of things you choose to wash. The same goes for naming a company. Marketing people will talk about features and benefits. It's always best to think about benefit. A second way to name a company is to pick a name that is memorable; something that you "Can't Get Out of Your Head", to quote Kylie Minogue. Google is a good example of a word that's almost unique, and people seem to know very well. The Body Shop is another good example. In fact, The Body Shop started up as an enterprise next to an undertaker's in Brighton, an accurate description of of what the the enterprise is about; that's the body, not the undertaker's, of course. And I did notice a beauty shop recently which did really amuse me cause' it was called Cut Up and Dye. A third way to name a company is by the names of the people that created it. This is a strategy beloved by professional service firms like solicitors and lawyers. You get names like Smith, Pottington, and Smith. However, I think it's a fairly lousy strategy for a company where the person is not really at the core of the business, particularly so when you when that business will change anyway. However, there are occasions when attaching the brand and the the name to the name of the originator is a sensible idea, particularly for industries where a craft is involved. For example, we have here the Fender Stratocaster, designed by Leo Fender, and this brand name really has lasted fifty years in a market where there are a lot of competitors. If you're going to use your own name in a company you need to be careful that it can be changed if your involvement ceases, or you sell the business, or something like that. A great example is KFC, which, of course, started out as Kentucky Fried Chicken, and was associated with Colonel Sanders. Over the years the logo has remained the same, but the words Kentucky have been removed replaced by KFC, as it's a worldwide brand, and Colonel San Sanders associations with that company are have been downplayed, so they've managed a clever move to change the name, and and getting rid of the sort of associations to the localness of the the product of that time. Finally, you can name your company according to the geography, and examples include British Airways, Bank of Scotland. Of course, none of those enterprises only operate in their chosen environments; indeed, British Airways is an airline so it's a global enterprise as is Bank of Scotland. Quite cleverly, of course, you can reduce British Airways, and this has been done to BA, and HBOS for Bank of Scotland. So, of course, you need to think about names that somehow can travel, so starting with a very narrow location can be a bit of a problem. So, your name should be meaningful and broad enough to accommodate growth. For example, naming a company Manchester Socks may actually limit you to the north of England, and sock making for the rest of your life. On the other hand, you can use naming that sort of gives you a lot more choice, but still contains the essence of what you do. For example, Swatch is a great idea based on the idea of the precision that's attributed to Swiss watchmakers, and it also contains the word watch in the title, so you know exactly what you're you're getting. So to conclude, there are many ways to name a company. It's really important to think about a name that allows for growth, doesn't locate you in a particular area or type of product or service, and things like that.


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