In 10 years, your company name will be passe. That intercap-ridden, OutToGoPublic.com name you registered with Internic last week is going to make you look bad. “The putting-the-capital-in-the-middle thing was trendy at first, but now it dates you,” says one naming consultant. And if you thought you were clever to lock up a category name as your URL, just wait for the lawsuit headaches you’ll have when four other companies begin to compete with you.
Naming a company seems like it should be easy: Get some friends together and brainstorm yourself a brand. But most companies end up paying a consultant tens of thousands of dollars to conduct consumer recall studies, pull teeth at the U.S. Patent and Trademark Office to register the name as a trademark and (an added hassle particular to Web companies) hunt through Internic for an available URL.
Even then, sometimes the company wants to start over. Each week, it seems, another Internet company changes its name, sacrificing millions of dollars in branding to be called something else. Last week, the Mining Company renamed itself About.com and acquired 3,000 other domains (aboutkids.com, aboutpregnancy.com) to lead users to the site.
Darrell Hayden, president of strategic identity-development company Hayden Group, which charges between $15,000 and $20,000 to find a suitable name and corresponding URL, says that his Internet clients often don’t realize that it takes more than a domain name. “I’ve been in meetings with clients where they check Internic and pick one – ‘Alpha.com looks available!'” says Hayden. “And we have to tell them that it’s not necessarily available in the real world. And they say, ‘Oh yeah, right.'”
Barbara Heinrich, VP of marketing at iOwn.com, which last month changed its name from HomeShark.com (“We found the name had different connotations for different people,” she explains), says finding a name was surprisingly difficult. Using Lexicon Branding, a brand-development company, she says, “We cut it down from 3,000 names to 85. After figuring out what’s a clean trademark and what URL you can get – only then can you do the focus group.”
The URL alone can cost $10,000 or more if it’s owned by a greedy prospector; hiring an attorney to check out your Top 10 list can run $1,000 per name. To keep it cheap, About.com created a fake company name to do the domain-name acquisitions. “If we, as a public company with $80 million in the bank, want to buy a name, the price is going to be ridiculous,” says Scott Kurnit, chairman and CEO of About.com.
The company name is the first line of defense against the competition. But right now, the fashion in Web-related names runs contrary to legal wisdom. In the real world, trademark and patent lawyers advise their clients to establish a wide defensive perimeter around their names by choosing ones that are (in legal terms) descriptive, suggestive and, most important, fanciful. A fanciful name differentiates a brand from its competitors. Clorox, Kodak and Xerox (XRX), for example, are powerful brand names with no prior associations in a consumer’s mind.
The intoxicating “first-mover” temptations of the Internet, however, have driven many people to choose plainly descriptive category names – often before a company has even been assembled. “We bought the URL before we had the business plan, to be quite honest,” says Tracy Randall, VP of e-commerce at Cooking.com.
But to be memorable, a name shouldn’t be generic. “Someone with an abstract name, provided it’s loaded with positive, mysterious, exotic images, has a more efficient engine for building brand,” says J. David Placek, CEO of Lexicon, which charges Internet startups $40,000 to $50,000 to find a name and a URL. Already, some Internet companies are discovering the problems of not having established that defensive perimeter.
SpringStreet, an online apartment-finding service, recently changed its name from AllApartments.com. “I come out of the packaged goods business,” explains Sophia Kabler, SpringStreet’s VP of marketing. “You’re supposed to make words mean something over time.” And having such a generic name turned out to be possibly damaging in a world in which the 30 minutes between seeing a billboard and getting to a computer might mean handing business to Apartments.com or Rent.Net. In the end, says Kabler, “We didn’t want to be confused with our competition.”
[Bernhard Warner contributed to this story.]