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How a Poor Business Name Can Lower the Value of Your Brand

By Grant Polachek Published December 12, 2018 Updated October 14, 2022

When you’re coming up with your business name, you may run into people who tell you not to sweat over your business name. They say that there is no tangible value to a business name – that names are just frills that aren’t worth investing time and resources into. However, studies show that simple, catchy names outperform non-captivating names on the stock market by up to 33%.

Rather than looking at the direct monetary value a good brand name brings, consider the inverse. How can a poor brand name devalue and damage your presence in the business world? Let’s consider the possibilities.

A Poor Business Name Won’t Set a Solid Brand Foundation

In today’s competitive market, first impressions matter. Oftentimes, your name is the first thing a potential client or customer hears about your brand. Your brand includes everything from your name and logo to your mission and values. It encompasses who you are, and should all be rooted in the name

If your name is weak, it will not be able to carry the weight of your brand. If people hear your name and don’t understand what your brand is about, they will move on without a second thought. The name must invite questions about the brand, it must intrigue the audience. It should encapsulate who you are and who you will become.

The name is essentially the identity of your company. If it is weak, it will not be able to carry your brand forward and set the stage for success.

Fail to Capture Audiences

Your audience is probably overwhelmed by the number of options available in today’s market. You may be offering unique services or products, but without a solid name that intrigues your audience, you may lose customers. If your name does not pique their attention immediately, they will move on without exploring the options you offer, causing you to lose potential revenue sources.

A name should establish a connection and offer the target market something to hold on to. Part of the reason Apple is such a successful business name is that everyone has experience with apples. It is one of the most basic, accessible fruits, and it is a tangible, everyday object. Naming a technology company after an organic object is intriguing, so the name captivates an audience.

As good as your idea may be, if you don’t have a way to establish a point of connection as early as possible, you risk losing an audience. Even if the business name catches just a few extra people, it’s worth investing in.

Drive Audiences Away

As much as your name must captivate your audience, you must also make sure it does not drive them away. Difficult, confusing, or offensive names may drive away a large portion of your customer base.

A salon called Curl Up & Dye is descriptive and clever, but it may send the wrong message about the quality or type of service offered. The name relies on the audience’s sense of humor but will lose potential clients that do not find the punny brand amusing.

Offensive names are even riskier. If your name is even unintentionally offending a group of people, you risk not only losing potential sales from that group, but also from people who align themselves with the group.

Audience testing is a simple way to validate that your name performs well with a target demographic.

A Forgettable Name = A Forgettable Brand

Even if a customer wants to remember your name, if it is bland or too confusing to say and spell, they probably will not remember it. When your target audience cannot remember your name, you lose out on sales.

Jeff Bezos started an online book retailer called Cadabra, Earth’s largest bookstore. It was intended to be short for the magic term “abracadabra,” but Bezos realized that the name was not catching on. It was difficult for people to spell and understand, and many simply did not understand the reference to magic. Plus, some people would hear “cadaver” over the phone or in crowded bars instead of Cadabra. After brainstorming with his wife, Bezos changed his company name to Amazon, and then his company took off.

Changing the name to Amazon had several advantages. To begin with, Amazon starts with A, so it’s usually high up on alphabetical lists. The Amazon is the earth’s largest forest, so the name works metaphorically. Also, because most people have heard of the Amazon rainforest, they immediately understand the reference as well as how to say the name. With one name change, Bezos solved three problems, and Amazon grew to become a hugely profitable business.

A memorable name makes for a memorable brand. Ensure that your brand does not fall to the wayside by coming up with a snappy, memorable name. Browse some winning brand name ideas to get an idea of what names catch your attention.

Lose Referrals

A good name not only has the power to captivate and draw in an audience, but it can also drive referrals and make spreading your brand easier. Even if you had someone use your services or purchase your products, if they can’t recall your name or if they find it too difficult to say out loud, they are less likely to pass it along to friends and family. Then, you lose out on those sales because your name was not strong enough to carry your brand.

Ultimately, your brand name should be captivating and memorable enough that it sets your brand up for success. If you fail to set a solid foundation for your brand with a good name, you will lose not only potential clients but also the potential referrals from those clients.

Referrals drive business, and referrals work through names. Investing time and resources into your business name is worth it in the end because it will maximize your profits down the line. Every small aspect adds up in the end, and if your name helps you get one extra piece of press coverage or a few more chains of referrals, it makes a difference.

We hope you’ve found this information on naming your business helpful. Please share your business naming struggles and tips in the comments section below!

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Grant Polachek

Grant Polachek is the Director of Marketing at Inc 500 company Squadhelp.com, the worlds #1 naming platform, with nearly 20,000 customers from the smallest startups across the globe to the largest corporations including Nestle, Philips, Hilton, Pepsi, and AutoNation. Get inspired by exploring these winning brand name ideas.

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Contents
A Poor Business Name Won’t Set a Solid Brand Foundation
Fail to Capture Audiences
Drive Audiences Away
A Forgettable Name = A Forgettable Brand
Lose Referrals

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