8 Tips for Choosing a Business Name

Why a business name is important

As a small business owner, a business name helps you develop the brand of your business, drives name association with the type of industry you're engaged in, and puts your own spin on your brand identity. For example, S.S. Kresge started his chain of five and dime stores in 1899, eventually shortening the business name to Kresge's. After WWII, the CEO of Kresge's decided that the company needed a name change as part of a competitive strategy shift.

The final name selected was K-Mart. This denoted to shoppers that it was a general store, while retaining the K from the Kresge name. K-Mart as a company has all but disappeared, but it was a commercial powerhouse for decades and a large part of that was the brand identity derived from its name.

Below, we outline just a few of the reasons why a business name is so important and explain how the right business name can help your company.

Create legitimacy

An official business name shows the public at large that you've gone through the process of creating a business entity and that you're operating within the laws that govern commerce. It also shows that you're engaged in commerce to provide services or goods to the public at large or sell to other businesses, depending on what you're selling and your focus.

Give a good first impression

Your business name is the first thing a customer sees and is the start of the relationship between you and your customer. A catchy business name or one that firmly denotes your business type and focus helps the customer get a good feel for the kind of experience they'll have with your establishment. After the first impression has passed, the customer knows what to expect from your business the next time they return to buy from you.

Reinforce your company’s core values

The reason why many people decide to launch a business is to do something in a way they think works better than if they worked for someone else. That includes running the business with your core values. A business is an extension of your core values in terms of how you treat employees, and it's something that customers pick up on as they buy from you over time.

Shape your brand

Your business name shapes your brand because it's a statement that tells the reader about the kind of commercial operation you're running. Essentially, it's a brand-defining concept that tells customers about your business and what they can expect when they engage in commerce with you. For example, say you're running a pet grooming business and you groom both cats and dogs. Picking a name along the lines of "It's Raining Cats and Dogs Grooming Service" effectively describes what your business does, but also demonstrates a bit of fun and a sense of humor.

8 tips for choosing a business name

Coming up with business name ideas isn't always easy, especially when you want to convey the right impression to customers. A good business name has to be more than a simple expression. In other words, a business name like "Scott's Widgets" may not be strong enough to generate a brand identity and encourage people to become your customers.

On the other hand, a complex business name makes it harder for people to pick up on and remember. The following eight tips will help you with picking a business name that provides nuance, context, and a description that covers the nature of your business in a few words.

Understand your brand

Your brand is what drives people to buy from you instead of a competitor, and it's something you need to consider when picking a business name. Think deeply about the values, perception, vision, content, and overall image you want to project as a business and use these insights to help you settle on a business name.

Branding your business is a somewhat nebulous concept, but it's needed to convey the products or services your business sells. If you're running a hobby shop, you may want to include those words in your business name for immediate recognition of your commercial activity and brand. A hobby shop seeks to sell supplies to people who have hobbies and need components, ingredients, and other supplies to work on their craft.

You may only wish to sell to a certain type of hobbyist in order to provide your knowledge and expertise alongside supplies. In that case, specifying the type of hobby in the name helps you attract customers who are seeking what you sell. An example of a business name could be "John's Woodworking Hobby Shop". You convey everything about your brand in four words.

Have a brainstorming session

When you're stuck or having trouble coming up with good business names, sit down with people whose opinions you respect and have a brainstorming session. Encourage everyone to put any idea on the table, regardless of how silly or unusual it sounds.

Once you have enough in the way of name ideas, you can start refining and bouncing ideas around to determine feasibility and fit. Brainstorming ideas for names also helps you get a feel for their effectiveness in attracting attention from others.

Make sure your business name is easy to pronounce

As a general rule, your business name should be easy to pronounce and read. It's more difficult to build brand loyalty when customers have a hard time pronouncing the name and refer to your business as "that business that sells X and Z" instead. You can substitute one letter for a similar sounding one in the alphabet if you like, but make sure that it's easily understood and pronounced.

For example, maybe you intend to operate an indoor skate park and use the word "Skatez" instead of "Skates" as part of the name. The pronunciation is the same even though the spelling is different, and customers immediately recognize the fact that roller skating is an activity offered by your business.

Make your business name unique

You want your business name to set you apart from your competitors but still convey your line of business. For example, an engineering firm wants their industry as part of their business name. They can use the names of the principals along with the word "engineering" in the business name to make it unique, differentiate it from other engineering operations, and make it clear as to the nature of the business and its owners.

Consider a logo to accompany your business name

Logos create a visual identifier that's ultimately associated with your business name. They're used as a type of visual shorthand when using the full business name isn't feasible, as well as to build your brand identity. Just think of Apple’s logo—without even seeing the company’s name, you can instantly recognize the brand by their logo.

A logo can be used in a multitude of ways when working on a marketing campaign and build on name recognition for your business. Logo design can be a fun part of creating your business name, so don't hesitate to get creative with different logo design ideas.

Decide whether to localize your business name or not

Localizing your business name consists of using the name of a street, locality, neighborhood, city, or state. There are pros and cons to using a local name as part of your business name. One of the cons comes in the form of pigeonholing your business to a neighborhood and making it more difficult to expand to new locations. On the pro side, using a local name can help you build a local audience or even identify the product you're selling to a larger audience.

For example, let’s say you sell hot dogs and related foods. You decided to name your business Chicago Hot Dogs because you're selling Chicago-style hot dogs. This may not stand out in the city of Chicago, but it may stand out in other areas of the country because a Chicago-style hot dog is a regional item in the same fashion as a New York City pizza.

Make your business name memorable

Good business names are ones that are easily remembered by your customers. You want to pick a name that's got a ring to it, as the saying goes. Work on creating a name that catches the eye and ear of potential customers and makes it easy for them to share by word of mouth. A business name doesn't have to be catchy to be memorable, but being clever can help you stand out from the competition.

Choose an available business name

This can be the most challenging aspect of picking a business name, especially if you're entering into an industry with a lot of competition. It's advisable to come up with as many potential business names as possible. This way, you'll have backups in the event the business name you pick is already taken or too similar to one that's been registered. Picking a name that's too similar to one that's already in use can lead to confusion among your target audience or even legal battles in some cases.

Your business name is part of your brand, and you don't want a lawsuit forcing you to change your business name after you open your doors. It confuses customers and can cause you to lose business, forcing you to start over again from scratch. Your state has a business name database that you can search through and help you come up with business name ideas. It also helps you avoid picking a business name that's already taken.

How to register your business name: 4 methods

Registering your business name protects it from being taken by another business entity and binds it to your enterprise until you decide to give it up. There are four methods you can use to register your business name. They include:

Entity name

Entity name registration is done at the state level and protects your business name for your state of residence only. That means someone who opens a business that's the same as or similar to yours can use the name in another state and you'll have no recourse. Ultimately, this is only a problem if you intend to expand your business to other states, and you can get around this issue by registering as a foreign corporation in the state you intended to expand into.

In order to register your business name at the state level, you'll need to go to your state's agency that registers corporate names. This includes the Secretary of State and Department of State agencies. All states maintain a corporate name database that's searchable and returns results that show you if your intended business name is in use, is similar to another name, or available for you to claim.

Trademark

In order to protect your business name at the national level, you'll need to get a trademark from the United States Patent and Trademark Office (USPTO). Getting your business name trademarked prevents another entity from taking it and using it for their own purposes. In the event another entity decides to use your business name after it's been trademarked, you may be able to take legal action to enforce your ownership by suing the infringing entity.

You can check the trademark database on the USPTO's website to make sure that your business name is available for trademarking.

Domain name

As a modern business owner, you’ll likely want to get your business online with a website. Part of building your website is registering a domain name, also known as a URL or web address, with a domain name registrar and hosting service. When you register your domain name, you own that domain name until you fail to renew it or decide to sell it. No other entity can take it from you, and that URL is permanently associated with your business as long as you're in operation and maintaining a website.

In the event you can't find an exact domain name with the .com suffix to match your business name, you can use a different domain suffix such as .net or create a variation of your business name.

DBA

A DBA, or “doing business as”, is an overlay on your current business name. It's known legally as a fictitious or assumed name and is registered with your local, county, city, or state government. There is no legal protection provided by a DBA, but you can legally use it to differentiate your business from your personal name or your incorporated business name. DBAs are not restricted in their use by multiple entities, so you can get a DBA that's in use by another business. Always keep in mind that trademark infringement laws are applicable with a DBA, and you should check usage rules with the government agency that handles the registration of DBAs.

Build your business with Mailchimp

Starting your business and creating your business name is the first step towards showing the world at large that you're ready to provide goods or services. You need to get people's attention in order to encourage them to spend money with you. Marketing is key to building your business and attracting new customers. It's also an opportunity to build your brand, share your vision for making people's lives better, and the core values you're going to use for the operation of your business.

Mailchimp offers the tools you need to help you build an email list, create an e-commerce website, engage in cause marketing, register a domain name, and find your ideal customer. Our website builder makes it easy for you to quickly build a professional website that reflects your business ethics, make pages for the products you sell, accept and process online payments, and show people how to find your brick-and-mortar location if you're operating a physical storefront. We also offer an appointment scheduler app that makes it easy for your customers to set up an appointment without picking up the phone.