When starting a small business, choosing the right business name can be tricky. Your name is the thing that your customers will associate with your business. Changing the name in the future has the potential to become a huge problem. Coca-Cola decided in the 1980s that it would redesign its logo, content, and even company name. The result was New Coke, which was one of the biggest failures in marketing history. Sales plummeted, which allowed Pepsi to increase its market share. While Coca-Cola later switched back to its original formula and name, it took years before the company recovered. The name you pick now is the name that you stick with in the future.
Picking the right name can be tough, so many people hire business mentoring companies early on in the process. The company does marketing research, using potential customers and their reaction to different names. Even if you cannot afford this type of company, you can still conduct your own market research. Create a few potential names and run those names by family members, friends, neighbors, and co-workers, gauging their responses to each one. After you narrow down the choices, you can compare those reactions to your own thoughts and pick one that fits.
In the early days of advertising, customers wanted companies with a name that fit its product or type of business. This is still true to a point, but many companies succeeded by launching with a name that had pizzazz. Axe, the company behind male beauty products and Contact, which is the name behind cold and sinus products do not remind customers of a specific type of product, but are very successful today. In service based industries, having a name that mentions what you do is a benefit. For example, Johnson’s Critter Removal or Belle’s Hair Salon instantly tell customers the services you offer.
Naming your company is really important because you build a marketing campaign around that name. Would you invest in Microsoft stock, if you knew that the company would go bankrupt next year? Choosing the wrong name is essentially doing the same thing. You spend big bucks on building a brand around the name of your company and creating a company that customers know. Changing the name to something completely different is akin to throwing your money into the garbage disposal, which is why you must pick a name that works from the very beginning.
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