February 26, 2001, 9:13 AM — A company's name carries significant weight. It must convey a certain attitude and an expertise, and it must also set the company apart from the competition. With corporate name changes and federal trademark registrations both at record high levels -- and with the added importance of securing a corresponding URL -- finding the right name for a company, product, or service is difficult. Glenn Gundersen, an attorney with Dechter law firm, in Philadelphia, and Peter Mack, vice president of corporate branding at Enterprise IG, in San Francisco, explain the name game.
1. Understand the difficulty
"The number of new federal trademark applications has almost tripled over the last 10 years. It will be close to 290,000 for the year 2000," Gundersen says. With the record number of corporate name changes (see graph, below), "the mathematics [of names and URLs] make it more difficult than ever to find a new corporate name," the attorney says. "To avoid the problem, more and more companies are selecting brand names that are coined or are a seemingly random combination of dictionary words." Both Gundersen and Mack say that if you are embarking on a corporate name change or even a product-naming project, don't be surprised if your first few choices have already been claimed by someone else.
2. Make the change for the right reasons
There are better and worse reasons for existing companies to change their corporate signatures. "You need to look long and hard at the equity your name has in the marketplace. Your key audience may understand what your current name means, and if you change, you might lose this equity," Mack says.
Mack also suggests some reasons not to make a change. "The desire for change is not enough of a reason to make a change," Mack says. Nor, says Enterprise IG, should you join the "e" or "dot-com" naming fad or scrap your current moniker because a competitor launched a new name. "A competitor's name change should be an opportunity to recommit yourself publicly to your company's name," Mack says.
Sound reasons to make a change include division divestiture, corporate spin-off, and violation or potential violation of another company's name, Gundersen says. Mack also suggests you make a change "if there is a profound misunderstanding of what your company does. You may have equity in a name, but it doesn't communicate what you do anymore."
3. Expect to spend time and money