5 Rules for Choosing a Business Name

How to Choose a Business Name That Will Make Your Business a Winner

Rocky Mountain Cafe sign.
How to choose a business name. (c) Dave McLeod

Choosing a business name is one of the most important things you'll do during the process of coming up with a business idea and starting a business. Starting out with a weak business name is like trying to golf with only one club in your bag. You may sink some shots but it will be a whole lot harder.

So how do you go about choosing a business name that will be a winner and draw business in itself? Get your family, friends and/or colleagues together for a brainstorming session and work through these five rules.

When Choosing a Business Name Remember:

1) A winning business name has to be memorable – but easy to spell.

Obviously, your potential customers and clients need to be able to remember your business name. But they also need to be able to find it easily if they’re looking for it online or in a phone book. So choosing a business name such as “Crychalwellyn” is a bad idea. Unique is good but difficult spellings are a bad idea.

2) A winning business name needs a visual element.

What popped into your head when you read “Crychalwellyn”? Anything? Most people don't visualize anything when they read this business name that I invented. But generally we are hard-wired to “see” images when we read or hear language, and incorporating a visual element into your business name can be a powerful aid to customers’ memory (and a powerful advertising tool).

The sign in the photo accompanying this article is a perfect example.

Even if they're not in front of the sign, just reading the words "Rocky Mountain" conjures an image of tall, snow-capped mountain peaks for most people.

So you want your business name to have a strong visual element to it. The catch is that...

3) A winning business name has to have positive connotation.

Many words have both denotation (literal meaning) and connotation (emotional meaning).

A word’s connotation can be positive, neutral or negative, depending on the emotional associations that people generally make. The classic example is the difference between “Mom” (which has a very positive connotation) and “Mother” (which has a neutral connotation). Now you know why they called them “Dad’s” cookies, rather than “Father’s”!

"Rocky Mountain Cafe" has a positive connotation for most people, evoking sunny days skiing, hiking or just hanging out in a beautiful natural environment. Change the name to something like Sludge Town Diner and see if anything positive comes into your mind.

What it means to you is that when you're choosing a business name, you need to choose words that have the positive connotations that you want people to associate with your business – and make sure these connotations are suitable for the business/industry you're in.

If you are starting a trucking business, for instance, you don’t want it to have a weak sounding or negative name, such as “Willow Twig Trucking” or “Kitten Transport”. You want a business name that conveys strength and reliability. A choice such as “Stone Creek Trucking” would be much better. Notice how all these names have a strong visual element.

4) A winning business name needs to include information about what your business does.

Chances are good that your new business is not going to become an international brand. (Learn more about branding your small business.) It certainly isn’t instantly going to become as well known as Nike or McDonald's. So you need to be sure that your new business name at least gives your potential customers or clients some clues about what you actually do.

That’s why you see so many landscaping businesses that have the word “landscaping” in their name, and hair styling businesses that include words such as “salon” or even “hair designs” in their names. It isn't hard, for example, for customers to figure out what products or services are sold by International Business Machines (IBM), Ford Motor Company, or Trans Canada Pipelines.

Including information about what your business does in your business name also makes it easier for potential customers and/or clients to find your business in directories (both off and online).

5) A winning business name has to be fairly short.

Once again this is vital because you want customers and clients to be able to remember your business’s name (and be able to tell other people what it is)! But it’s also important for promotional purposes. You want a business name, for example, that will fit well on a business card, look good displayed on a sign or in an ad, and perhaps even a business name that will serve well as a domain name and show up well in search if you have an online business. So keep it as short as possible.

And a last tip: Think about colors when you’re choosing a business name. Colors will be an important component of your business logo and other business promotion materials and your business website, and colors have strong emotional associations, too. Red, for example, is an aggressive color; its fiery elements are associated with speed, excitement, and passion while green is a calming color associated with growth, renewal and nature. 

Registering and Protecting Your Business Name

You’ll want to create at least two winning business names, and three is even better, because once you’ve chosen a business name, the next step is to register it and your first choice may already be taken.

Registering your business is one way of protecting your business name, particularly if your business is incorporated. (Sole proprietorships and partnerships are the easiest forms of business ownership to set up, but registering either of these forms of business gives no business name protection.)

Federal incorporation gives your business name national protection. The best name protection is provided by trademarking your business name, which gives you exclusive rights to use the trademarked name nationally as well as priority in trademarking the name internationally.

Putting It All Together

Do you now have a winning business name that meets the requirements of all of the above five rules? Good! Hopefully, you’ll be living with the name for your new business for a long time – and it will continue to attract new business.