Tuesday, July 23, 2013

Startup Company Names Make the First Brand Impression to Your Customers



Startups have begun to adopt quirkier and quirkier names in an effort to begin to build their brand right away.  What you may not know is that Yahoo and Google led the way.  Yahoo stands for "Yet Another Hierarchical Officious Oracle" and Google is a mis-spelling of googol the number with 100 zeroes after a one.  Then came Flickr and Tumblr.  Now the names are getting even wackier.  There's Mibblio, Kaggle, Shodogg, Zaarly, Spotify and a whole bevy of others. 


One reason for these types of names is that it helps branding and marketing.  There are several categories of marks with each category giving the trademark owner stronger or weaker protection.  Those categories from strongest to weakest are:  “arbitrary/fanciful,” “suggestive,” “descriptive,” or “generic.”  A coined phrase or made up word would be arbitrary/fanciful and provide the broadest protection because there are no other similar words like it.  A suggestive mark is one that suggests rather than describes a characteristic of the goods/services it represents.  For example, the trademark “Apple” for use with computer-related products would be suggestive.  A descriptive mark is one that merely describes the nature, quality, or character of the goods.  For example the mark “Red Fruit” when applied to an Apple Farm’s product would be descriptive. Generally, in order to obtain trademark protection for this type of trademark, the owner will need to prove that its mark has “acquired distinctiveness/secondary meaning.”  This means that the owner will have to show that consumers actually associate the descriptive mark with the owner’s goods/services and not view it as a description of the product. Finally, a generic term is the common name of a product.  It cannot serve as a trademark at all.  Some famous trademarks that have become the generic term for the product include “Thermos,” “Linoleum,” and “Escalator.” Thus, this trend by startups to create words puts these trademarks at the higher end of the trademark spectrum.  They also help avoid issues with trademark infringement with other companies. The more made up the name, the stronger the trademark.  As with any name or trademark, the object of the exercise is to be sure create a name or a trademark that conveys some meaning to the consumer. In addition, a good trademark should be memorable for the consumer.



Another reason is that these companies need a web address that is easy to remember and recognize. As you may imagine, most of the good or short ones are already registered.  It also helps to have shorter names to make it easier for potential customers to remember.  Commonly, the company will choose a mis-spelling of a word, mash two or more words together, or find some other way to come up with a name that is unique and still conveys a message to the consumer about that company's products or services.

Some companies will use an algorithm to create one word from two or more words. However, it is important to understand how the new name looks or sounds because in some cases the look, sound, orconnotation when actually read or spoken may be unfavorable. 

Overall, this can be a very good trend for strengthening a startup’s trademark.  I cannot tell you how many times my clients have clung to trademarks that were descriptive, rather than suggestive or arbitrary/fanciful which meant that those clients had to work harder to get consumers or potential consumers to associate their trademark with their goods/services.  One downside to this trend, though, is the promulgation of similar types of names.  For example, how many items came out with names that start with “i” after Apple came out with its “iPod” products? 

It is always important to pay attention to your brand and try to “get it right” the first time.  A company does not necessarily want to change its branding image mid-stream (a la go from Research In Motion or RIM to Blackberry). 

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