Naming a business is (most of the time) a fun process. You sit down and start writing possible names on a peace of paper and then you ask others what they think about it, …
After few hours and a bit aggravation, you might say … hey my full name is John Brent Smith …. what if the name will be JBS, wow excellent.
Wrong my friend! You just made the biggest mistake.
You see few rules in naming a business are … never name it with initials of your name nor should you shorten up a big name into initials (Ex. Stibel Plastic Factory = SPF). The only time when you can use initials is when your business is very much known. And I mean …. VERY much known to the public. Ex: IBM, BBB, UA, …
Do not try to pick a name that sounds like your competitors name, especially if they are the biggest player on the market. We know that Goodyear tires are a popular brand … what about Goodrich? Every new innovation Goodrich comes out with … much of the public confuses them with Goodyear and ultimately buy from Goodyear Tires.
If your product is new and there is nothing like it on the market … don’t be afraid to give it a meaningless name (as long as it sounds good and easy to remember).
If you’re another business coming on board, pick a name that stands for something. Make sure people will understand what you do by your name (I know this is not easy).
I found that using your last name is a good strategy. Look at Procter & Gamble, Oppenheimer Funds, Hewlett-Packard, Dell … You know why it’s a good strategy? Because from birth we’ve been learning to remember last names of people we talk to. Last name can have a ring to it. If your last name is Abeharbadininov … do people a favor, don’t use it to name a business.
Before you settle on a name try using it in a sentence. Try using it verbally and in print.
(UPDATED October 2nd, 2006)
Just saw a great article by Al Ries that is relevant to this post. You should read it now.