When choosing your business name, you need to think carefully – it can become an important marketing asset. However there are also important legal considerations, for example is the name you have chosen the same or similar to that of an existing business.
It should be memorable. Long names, or initials, are often hard to remember. Distinctive names are best, though quirky names like Egg or Orange can confuse customers, unless you are prepared to promote them hard to establish the market position you want, or the name suits you because you are a creative business.
Someone buying your business will usually want to carry on using the same business name. So choose a name you are happy to relinquish when the time comes. If your business name is your own name, or some other name you will want to carry on using yourself in the future, this can be a problem.
Another benefit of distinctive names is that they are easier to protect – for example, by:
bringing a ‘passing off’ action in the courts against anyone who copies it;
registering it as a trademark which gives you significant rights against someone who tries to use your name, or a similar one, for their business.
A name that is just a description of what you do (eg ‘The Card Makers’) means people know what you do immediately, and may remember you more easily, but if you decide to change what you do, or expand into a new area, you may have to change your business name, and start building goodwill in the new name all over again. It also makes it harder to register it as a trade mark, as it is just a description of what you do, and not distinctive enough to justify protection as a registered trade mark.
Your business name should help you build up goodwill for your business among customers, suppliers and employees. If you succeed, it could become a valuable asset that you can include in your balance sheet, sell, mortgage to raise money or license others to use.
Many businesses with multiple business names use a distinctive word in all of them, with additional descriptive words for different parts of the business. Some brands are very ‘elastic’ and can be stretched over many different businesses (such as Virgin Airlines, Virgin Money, Virgin Trains, Virgin Mobile, etc). Others are less elastic (so Cadbury is only used for chocolate products such as Cadbury Creme Egg and Cadbury Dairy Milk). But if you get it right, you can develop a ‘family’ of names that provide reassurance to customers, whichever part of the business they are buying from, and whichever products they are buying.
Business names, especially brand names, can be made even more memorable and distinctive by combining them with, or incorporating them into, designs, graphics, logos or straplines.
Finally, your name should not be the same as or similar to a name being used by another business, as you could end up in a costly row over who the name belongs to – especially if the other business is in the same industry sector or geographical area as you.
If you would like to discuss this or any other marketing concern that you may have with one of our advertising and branding experts, please call 01646 682676 today.