THE BLOG

The 7 Biggest Mistakes to Avoid When Naming Your Business

04/03/2015 02:35 pm ET | Updated Jun 02, 2015

Choosing a name for your business is a crucial step in starting a company, and there are many mistakes you can make. A great business name is unique but easy to remember, and it should be able to carry your business into a profitable future. And because choosing a name for your company is so important, you want to avoid the most common mistakes.

1. Using a Name that's Less Available than an Uber on New Year's Eve.
Is the name you're considering already in use or otherwise unavailable? If it's already registered or used as a trademark by another company, you may not be able to use it. Check with the United States Patent & Trademark Office's website to see if a trademark is currently registered, although just because it's not listed on the USPTO's website, doesn't mean that it's available.

Trademarks can be Common Law, resulting from use, or Federal, resulting from both use and federal registration. In other words, trademarks don't need to be registered to be used as trademarks. Because of this, it's almost always a good idea to pay a company like Thomson Reuters to perform a comprehensive trademark search before filing an application.

The other consideration is whether the related domain name is available. (You can check availability by searching on GoDaddy.com or another domain registrar.) And yet, just because a domain name isn't available doesn't mean you can't or shouldn't use it. For example, Tesla doesn't own tesla.com, and yet, when you hear just that word, you likely think of Elon Musk's Tesla Motors.

2. Putting Your Secret Sauce in the Name.
Don't put your company's services, products or ingredients in the name. First, as your business grows and evolves (and it will), you may lose the interest of your customers or wage a losing battle to overcome dated notions of what it is you sell. CompUSA faced this issue and eventually saw its demise. RadioShack has also struggled to remain relevant as mp3 players and smartphones have taken hold.

Secondly, when you put general product or service descriptors in your company's name, you may face an uphill battle in obtaining robust federal trademark for your business. U.S. Federal Trademark laws provide significantly greater protection to non-descriptive, distinctive trademarks.

The United States Patent & Trademark Office can refuse to register your trademark on its Principal Register if the trademark on the application includes words deemed "merely descriptive." This means words that describe an ingredient, quality, characteristic, function, feature, purpose, or use of the specified goods or services. In 1986, "Bed & Breakfast Registry" was denied trademark registration because it was considered merely descriptive of the lodging reservations services the registrant offered. In 1987, "Apple Pie" was denied trademark registration for a brand of potpourri.

On the other hand, trademarks that are not descriptive of the products or services with which they are associated, can receive significant federal trademark protection. Because, for example, the word "apple" is not intrinsically associated with computers and electronic devices, Apple Inc.'s "Apple" trademark is afforded significant trademark protection. However, there is a fine line to walk between being distinctive and being too creative or obscure and irrelevant.

Additionally, you ought to avoid business-speak or buzzwords and clichés popular in general business forums. Think: Synergy, Leverage, and Apex. These terms can quickly lose all meaning and then you're left with an empty cliché of a name.

3. Letting the Name Grow Longer than Pinocchio's Nose.
The longer a name, the less chance that someone will be able to remember it. The most memorable brand names have one or two words. Think Amazon, Apple, Best Buy, and Wal-Mart. Even PricewaterhouseCoopers doesn't use its full name, but goes by PwC.

4. Don't Choose a Seven-Car Pile-up for Your Company's Moniker.
While it may once have been cool or innovative to smash together words, without spaces, to make a business moniker - we're looking at you, RadioShack - it isn't anymore. Don't AmeriTech yourself.

5. Keeping it Too Close to Home.
Including geographical descriptors in a business name can be restrictive if you want or plan to expand out of a particular geographic area. There really is a fine line to walk here. While putting the business's town, city or state in its name might limit potential growth, it can also add charm and help distinguish the company from similarly named businesses in other locations.

6. A Name that Even You Can't Spell Correctly.
Spell-check your name choice, please. When a company name is spelled incorrectly, it can cause potential partners, hires, prospects and customers to lose faith in your abilities. Even if you explain the misspelling, your audience might be forever turned off. Whose Your Landlord, a site that allows renters to give feedback on their landlord, explains what looks like the improper use of "whose" over "who's" as an intentional choice signifying a return of power to the renter. And yet, for grammar fanatics, the explanation falls short.

In addition to avoiding the use of a misspelled or grammatically incorrect name, you should also avoid a name that would be hard for others to spell correctly.

7. Not Testing.
Find out what a large, unbiased group thinks about your name before moving ahead with it. Find out what potential customers and clients think. Create a similar logo featuring the different names you're considering for your business and share it on social media. Or use an even more scientific method to test your brand name. You can do this by creating one landing page for each logo/name option and run a highly targeted Facebook ad to gather metrics on which name/logo gets the best response.

Steve Cook is an attorney at Cook & Cook in the Phoenix, AZ area.