Do's and Don'ts of Naming

Do you believe descriptive names are the way to go in business?

I was reading the 1-Page Marketing Plan book and enjoying it well enough until the author began advising people to choose names that spell out exactly what the business does.

If you’re testing a concept and using a temporary name, then it’s fine to choose a descriptive name. But except for very limited situations such advice about naming is appallingly misguided. It demonstrates a complete lack of understanding about business design and intellectual property.

I thought of leaving a bad review and low rating on Amazon to say the author is wrong, wrong, wrong. But I didn’t bother because the book has over 5,000 reviews so my review would hardly be noticed.

I forgot all about the book until recently when the author, Allan Dib, was being interviewed on a podcast. Although it wasn’t at all relevant or necessary to the discussion in hand, he proceeded to spout his views about names, saying how he believes the title should equal the content, that if the name doesn’t make it automatically obvious what the product, service or business is, then you’re starting from behind.

Allan Dib is by no means the only one who has this misconception about names, so I decided to highlight the point in this newsletter and explain why it is such bad advice. Sadly, it’s quite widespread among marketers and founders who don’t understand how intellectual property impacts business design. Marketers receive no training at all in IP which is why I’ve created the Brand Tuned Accreditation program.

A name is a container of the value a business generates. It’s a unique identifier because the law does not allow others to use names that are similar to ones owned by competitors. However, a descriptive name cannot be a unique identifier. It cannot be owned. That means descriptive names are more like a colander than a container. You lose value because business that might otherwise have come your way if you had a proper name will instead be spread out and shared with your competitors.

The law keeps terms that traders need to use free for all to use. So, the last thing you should do is to use a name that is descriptive of what you do because such names are not trademarkable. A name needs to be capable of functioning as a designation of origin. If you lack such a name you are highly exposed, and may have less success than you might otherwise have had without realising it’s due to your poor choice of name.

Say you specialise in making fresh pizzas and decide that the perfect name to describe what you’re doing is to call your business ‘Fresh Pizzas’. Such a name would not be trademarkable. You would lose business using such a name because other pizza sellers are perfectly within their rights to say they also sell fresh pizzas. So, while you go around believing ‘Fresh Pizzas’ is yours because you’ve named your business ‘Fresh Pizzas’, in fact any other pizza business is able to refer to themselves as ‘Fresh Pizzas’ too. So, you inevitably lose market share. Competitors would not be ‘passing off’ if you’re using a name that cannot be owned leaving you with no legal remedy to stop damaging competitor activity.

The law freely permits competitors to say they offer fresh pizzas in their sales material. You don’t own ‘fresh pizzas’ just because you’re using it as your unique name. The upshot is that consumers would have no way of telling you apart from the rest. And that purely happens when you don’t have a unique name and are just using a description of your product or service!

Names are potentially the most important intellectual property a business can own. The purpose of a name is to give consumers a unique identifier by which to recognise your business so they can find you again should they want to do so. The name is not the place to describe what the business does.

While the word ‘fresh’ is not distinctive enough to lift the generic word ‘pizza’ into an ownable name the word ‘fresh’ when used in a different context can be distinctive. Say an umbrella company decides to call itself ‘Fresh Umbrellas’. That’s a distinctive name because competitors do not need to use the word ‘fresh’ to describe their umbrellas. In the context of umbrellas ‘fresh’ is meaningless. So, the less meaningful your choice of name is, the more distinctive it is likely to be and hence the more likely that such a name can uniquely identify your business.

Many businesses soon realise how important it is to have a distinctive name. If they started out with a descriptive name and become successful, they find out about the limitations of their choice of name and look to make a change so they can secure a trademark and grow. They tend to turn to initials as a first step. For example, Business Networking International became BNI.

However, not all initials are ownable and sometimes another business might also need to use the same initials. This happened with the World Wide Fund and the World Wrestling Federation. They were locked in trademark and domain name disputes throughout the world for over 10 years until the wrestling federation changed its name to WWE. Far better to choose the name you intend to use long term rather than to have to make a change later.

So, avoid descriptive names and choose a proper name for your business from the outset. Remember that the less meaningful a name is, the more distinctive it will be. The purpose of a name is to give you a strong unique identifier for your business.

There is a lot to understand about naming. Whatever you do, don’t take the advice of marketers like Allan Dib or anyone else who tells you descriptive names are the way to go. They have a very narrow perspective and don’t understand intellectual property and the bigger picture about the role of names.