8 Mistakes to Avoid When Choosing a Business Name​

Introduction

Choosing the perfect business name is important. Catchy and memorable names can help create a recognizable identity and attract customers. Conversely, a bad name could fail to create a memorable connection or cause confusion when a potential customer is choosing amongst various businesses. Even if you foresee no consequences from your name choice at the time, you might find it difficult to stand out later on.

The name you choose for your business will depend on a variety of factors, including personal taste, preference, or existing recognition. It’s important to take the time and think about what your company is all about, what your values are, and how you want to be perceived. These questions will help you decide on a name that will encapsulate your business perfectly.

When choosing a new business name, make note of the following 10 mistakes to avoid in order to stand out in a competitive market.

1. Choosing business names that restrict growth​

Choosing a business name is one of the most important decisions a new business owner will make. It needs to be memorable, relevant, and non-limiting. Choosing a name that limits growth can lead to confusion in marketing efforts and restrict opportunities for expansion. A recent study by Forbes found that more than 60% of small businesses change their company name within the first two years of operation. This is because they realize they’ve made a mistake with their original choice.

When choosing a business name, you should create one that is inclusive enough to give your business room to grow. Here are some examples you should avoid:

• Names based on one service or product, if you plan on changing direction
• Names that reflect current fads or trends, as they might not be relevant years from now
• Names based on the town where the business was started, if you plan to expand geographically

2. Picking business names that are too general

A business name is the first thing that people will see when they visit your website. If it’s too general, it won’t be able to tell them what your business is about. For example, if you are selling iced tea, naming your company ‘Iced Tea Company’ would not be very effective because there are many other companies who also sell iced tea, resulting in weaker consumer awareness.

It’s important to choose a name that’s simple enough to be remembered, yet catchy enough to make it stand out amongst the competition. Think about the names of some of your favorite companies, such as Google and Nike. Both are instantly recognizable, even without seeing their logo. Having this instant recognition leads to more customers and increased revenue.

The best name for your business would be one that conveys what you do, but is also flexible enough to allow room for expansion.

3. Misspelling common words

The first mistake is choosing an unusual spelling of a common word. This may seem like an attractive option because it will be easier for people to remember but this could also have negative connotations or cause confusion with other businesses with similar names. For example, if there was another company in the same industry with the same name but spelled differently then this could cause confusion for customers and potential clients who can’t tell which company they are contacting.

Another mistake would be choosing a name that sounds too much like another company in the same industry or in the same geographic location. This can lead to customer confusion as well as legal issues.

4. Creating a name that’s too long, or too difficult to spell, pronounce, or understand

It’s wise to choose names without too many syllables in order to make your business’s name easier to remember. If the word has more than two syllables, then people may find it more difficult remembering and saying it correctly. Note that most people won’t want to say something very long if they don’t know what it means.

A good way to make sure that you are choosing a good name is by testing it out with a few people who are not in your line of work or close family members. This will allow you to see how they react when they hear your business name. If they can’t pronounce it or don’t understand it, then this may be an indication that you need to find a better name.

5. Forgetting to search online and offline for doppelgängers

It is important to do your research on whether or not the name is already taken by another business before settling on a name. You can start by searching online to see if anyone else is using the name you have decided. Often, a business name will be in use by many multiple small entities that may not have a large social media presence or be fully registered at all. If you come across many uses of the same name, then come up with a new one. You should also verify there aren’t any trademarked names that are similar to yours, in order to avoid getting in trouble with intellectual property laws.

Some ways to ensure that no one else has already registered your business name do the following:

• Perform a simple online search of your proposed business name
• Check for businesses currently using the name as a d.b.a. (doing business as) by checking the list of fictious or assumed business names at your county clerk’s office
• Search the business name on your corresponding state’s Secretary of State database (for corporations, LLC’s, and limited partnerships)
• Verify that the name hasn’t be registered with the U.S. Patent and Trademark Office (USPTO). Visit www.uspto.gov, go to “Trademarks” and then click “Search Trademarks.”

6. Neglecting domain name availability

No matter what you call your business, it’s important to think of the domain names that are available so that you can purchase one before your competitors do. Even if you don’t have plans to set up your website straight away, it’s a good idea to reserve the domain name you want to use. Not only is it affordable – often only $10-20 per year – but no one else will be able to use your domain.

Be aware that most common names are already taken, but can be purchased from the owners at their discretion. In this instance, suppose your name is Frank and you wanted to name your pizzeria Frank’s Pizza. If you did a search on a domain registrar, you’d notice that frankspizza.com has already been taken. However, you can submit an offer or negotiate with the current registrant if you must have the domain name at all cost.

On the other hand, most domain registrars will show you a list of alternative versions of the domain name to choose from, such as .net, .org, .business, etc. If you find that none of the suggested names suit you well, it might be a good idea to think about choosing a different business name.

It is recommended you take some time carefully looking to see if there are any domain names that could work for your company. A good domain name can really set you apart from your competitors and entice potential customers online.

7. Turning your company name into alphabet soup

Before the Internet became so widely available, printed directories such as Yellow Pages were the norm form business lookup. Hence, companies in the alphabetical beginning of the sequence would experience more success. How much, varied depending on the industry. For example, if you are searching for a business, you will notice that the letter A (as well other letters) is heavily represented with Names such as “AAA Locksmith” and “Active Appliance.” By adding words with the letter “A” such as “Active” to a company’s name, it allows the company to be seen first in a directory. However, print media listings are less utilized these days compared to internet directories. Instead, think about how your business will show up in a Google or Bing search.

8. Not seeking feedback

Now that you have a few ideas for your new business name, it is time to get some feedback. Run something by your closest friends, family and colleagues. You might be surprised at what they have to say about your idea(s) – perhaps it’s better than you think. Either way, constructive criticism goes a long way.