Nearly every day, I receive inquiries from clients, students, and friends wanting advice on brand names. Perhaps the best way I can efficiently help these constituents, without charge, is to write this post. So here it goes. Hopefully, you will benefit too.
Is choosing your brand name your most important marketing decision?
In their best selling book, Positioning the Battle for Your Mind, Ries and Trout tell us that choosing the right brand name is the most important marketing decision you can make. While it is certainly important, many marketers know that there are many marketing decisions that are vying for this superlative status. They would argue that Apple did not become the most valuable company in the world because of its name. Many believe that product design and quality – starting with the iPod (or perhaps the iMac) – set Apple on its upward trajectory after many years of struggling under the same name.
What if the name is not great?
Many companies have achieved considerable success with a less than stellar name by using other branding elements, such as logos, slogans, jingles and mascots, to explain or correct for deficiencies in their name. One that comes to mind is AFLAC. It is an acronym for American Family Life Assurance Company. The name was weak – not because anyone thinks so, but because when tested, only 2% recognized the name. If prospective buyers cannot remember the name, they will be far less likely to buy anything sold under that name. After spending a lot of money on a national ad campaign, the company grew their name recognition to 10% – a noticeable increase, but not where it needed to be. Then, in one commercial variation, AFLAC’s ad agency created a duck mascot that shouted “AFLAC” in a way that reminds us of the “Quack, quack” sound a duck makes. After featuring this mascot in national commercials, name recognition shot up from 10% to 94% – greatly increasing AFLAC’s sales. In this case, the name didn’t do it, but the mascot did.
Another example is GEICO – an acronym for Government Employees Insurance Company. After being acquired by Berkshire Hathaway, GEICO wanted to widen out its target audience from government employees to the general public. Borrowing a page from the AFLAC playbook, GEICO created a gecko mascot to help with name recognition. It later added cavemen and other mascots to its cast of branded characters. What really helped GEICO the most, however, is a slogan some think is too long – “15 minutes could save you 15% or more on car insurance.”
Why a great name is enormously helpful
While other branding elements can help you to overcome a less-than-spectacular name, coming up with an effective name can do wonders for your bottom line. If your name is working for you, you can use the other branding elements (logo, slogan, colors, fonts, jingles, mascots, spokespeople) to facilitate selling products and acquiring talent with less investment and effort. Why? Your name is ubiquitous and usually the first point of contact with your organization. If buyers better remember it, understand what you do, and know why they should choose you over competitors, you will have a big and cost-effective advantage in the marketplace.
How to develop a more effective name
Whether naming your company or your products, there is a proven procedure you can follow to help you develop a more effective name.
- Customer focus. Get out of your head and into the minds of your target audience. Find out what your audience wants that they are not getting from competitors, and try your best to give it to them.
- Easy to pronounce and remember. Make sure your name is easy to pronounce in the markets in which you plan to operate. When Kraft snack foods became Mondelez, many could not pronounce or remember the name.
- Make what you do clear. Start by making it clear what your company or products do. When you see, Dunkin’ Donuts it is clear what the company does and its products are.
- Benefits. Make it clear how your company and product will benefit buyers. If you are selling a butter substitute I Can’t Believe It’s Not Butter makes the benefit clear.
- Uniqueness. This is one of the more difficult aspects of creating a name, but if you can do it in the name, you have the other branding elements to add more value. Coca-Cola was unique and descriptive. It has helped the company achieve and maintain its lead in a very competitive business. While Nokia was numbering its phones and RIM created the Blackberry name, Apple came up with the iPhone. It was more than a phone that also had the i-prefix to connote Internet access and a personal device since there is no more personal pro-noun than I.
- Trademark. Consider trademark issues. Too often, the name you want to use is already taken. You can and should take steps to avoid infringing on an existing trademark. Doing a search (using a search engine) is a good first step. You can sometimes avoid infringing on trademarks by deliberately misspelling words, reversing letters (Toys ‘R’ Us), or using many methods that help you avoid trademark problems.
Remember if you inherited or created a name that does not follow what is suggested above, all is not lost. You can often fix the issues using the other branding elements as AFLAC and GEICO did.
Include or exclude the company name
Inclusion conditions. Along with the considerations above, a big naming decision is whether or not to include the company name in the name of each of your products. If the company has a good reputation for making the kind of product you are naming, you should probably include it. Coca-Cola named their products made with artificial sweeteners that were acceptable in taste tests – Diet Coke and Coke Zero. Microsoft named their office suite of products Microsoft Office.
Exclusion conditions. The case of exclusion, or separation, is a bit more complicated. You should typically exclude a reference to the company in the product name under the following conditions:
- Risk bias. If the product blows up or has any negatives, you do not want them to spill over to damage the sales of your other products. Coca-Cola’s first diet cola was called Tab since it used an artificial sweetener that left a funny after taste in taste tests. BP re-branded Arco gas stations as BP. After the oil spill in the Gulf of Mexico, this turned out to be a costly mistake, and many gas stations were changed back to Arco.
- Expertise bias. Clorox was so well known for making bleach that when it named its detergent Clorox, it did not sell. Prospects thought the product would bleach the color out of their clothes. Xerox was known as the copier company. When it ventured into personal computers, sales were disappointing. Ironically, IBM was known for making computers. Its foray into copiers was not successful. When a company is so successful associating itself with one type of product, the market has trouble believing it could be good making a different type of product.
- Brand image bias. Baby boomers in the 1970’s liked Japanese cars because they were small, inexpensive, and fuel-efficient. As they matured and became wealthier, they desired luxury cars. The Japanese car manufacturers understood that baby boomers had trouble accepting the brand names of Toyota, Nissan/Datsun, or Honda as luxury brands. To remedy this problem, they devised new luxury brand names – Lexus, Infiniti, and Acura. In fact, Lexus is an acronym for Luxury Exported to the US.
- Distribution channel contention. Some companies sell products under different brand names via different distribution channels to avoid resellers being damaged by price competition. This is common in the mattress business.
New companies or products
In addition to the suggestions above, there are some other considerations that may be important in naming your company or products. If your company is a start-up or your products are new, you should consider selecting a name that will...
- Be easy to pronounce, remember, and pass on to others in viral pyramids (Apple)
- Represent the main products your company will sell (Home Depot)
- Incorporate the company mission (SpaceX)
- Give benefits or good reasons to do business with your company (Best Buy or Costco)
- Be unique and not be taken by others in the same business (Xerox)
- Not be easily confused with competitors in the same business (Goodrich and Goodyear)
- Lend itself to a good stock abbreviation (IBM)
- Not have negative connotations in foreign markets in which the company is likely to operate (Mondelez)
- Represent the founding fathers or mothers (Hewlett-Packard)
Changing names or adding new product lines
If the company is a going concern with known products, you should consider the following before making a change to your brand names:
- Make sure the reasons for making the change outweigh the reasons for keeping the previous name
- Take advantage of the brand equity built up in the former name (unless a separation strategy is required per the exclusion conditions above)
- Do not make changes that confuse your existing good customers (the name change of JC Penney to JCP did)
- Do not limit future expansion or necessary product changes (Apple Computer became Apple Inc.)
While it is nearly impossible to create a name that does everything perfectly, the above lists can provide a logical framework to help you name (or rename) your organizations and products. Don’t expect this to be trivially easy. It rarely is. Best of luck.