Naming a New Business: 4 Important Steps to Choosing the Right Business Name

Starting a Business

By Darpan Munjal

Recently, a survey was released that became a trending topic across major news outlets and social media channels. The unscientific poll claimed that 38% of Americans wouldn’t buy Corona beer because of the coronavirus. While the accuracy of this survey is questionable, outlets and audiences took the story and ran, claiming that the shared name of our now global pandemic hurt beverage sales. While it was nearly impossible for the brand to have predicted such a coincidence, Corona is now receiving additional criticism for the release of poorly timed ads during this highly sensitive time.

What Corona is dealing with is an example of a negative name connotation based on world events. A name can have a significant impact on a company’s bottom line. In fact, researchers found that stocks with easier-to-pronounce names performed better than those with more difficult-to-pronounce names. These are real-world consequences of untested or misinformed name choices. A brand name is the mission statement and the first impression rolled into one. It’s crucial to have a name that immediately captivates customers and leaves them wanting more.

Developing a lasting name for your brand is one of the most challenging parts of the creative process. While you cannot predict the next news cycle or global health crisis, here are four ways to select a name with meaning during the precarious times we live.

1. Understand naming constructs

What’s in a name? Everything. The first step to selecting a long-standing brand name is to understand naming constructs. The vast majority of brand names fit into one of five styles: classic, clever, pragmatic, emotional, or modern. The style of your brand’s name determines the tone of your brand, which in turn affects your audience’s perception of your company.

Each style has different advantages depending on your business and the preferences of your target audience. Carefully consider each category, as styles that work well for some brands perform disastrously for others.

Adopting a naming style that represents your business and values (classic, clever, pragmatic, emotional, modern) will allow you to move forward in a clearer direction. It will also allow you to immediately take ideas off the table that are not a good fit for your business model, goals, and strategies.

2. Brainstorm

Lasting names often derive from productive brainstorming. It may feel that the “good” names have already been taken. After all, over 627,000 new businesses open each year. Selecting a quality name can appear too competitive and nearly impossible. However, don’t let this discourage you—let it motivate you to be innovative.

Brainstorming is the first part of the naming process. Instead of selecting a word or two words that sum up your entire brand, product, and values, focus on capturing a single essential element. This may mean looking past your product or business model, and at your brand attributes, values, and customer experience.

Try starting with an idea or an image, and then create different versions of this idea or image, using various names. Get your team involved with this process. Not only will it cultivate collaboration and team building, but the diversity in thought will spark new name ideas you would not have imagined on your own. From visual descriptions to compound phrases, to plays on words to foreign idioms, the results from the brainstorm session will get creative juices flowing.

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3. Ask your audience

If we learned anything from Netflix, it’s that love is blind. So is falling in love with a name early on in the naming process. Unfortunately, we often have a preference based on our assumptions or even unconscious bias. This can turn into a PR nightmare if we fail to ask for feedback regarding our ideas.  For example, Kim Kardashian West was under immense pressure to rename her Kimono shapewear brand to SKIMS after being accused of cultural appropriation. This isn’t the first time a brand was accused of being insensitive to our growing global market.

After brainstorming, it’s extremely important to audience test. Audience testing will offer valuable insight into the names that will appeal to your target market. There are several ways to test audiences that include Facebook groups, survey platforms, or Google forms. As the results come in, you may discover that the name you initially loved does not resonate with your audience. Even worse, you may find that the names are actually offensive.

Be prepared to give up on favorites if they don’t connect with audiences. It’s also not uncommon for audiences to resonate with unexpected names from your shortlist. Audience tests are so helpful because they allow you to look past your own perspective and dive into the mindset of your eventual target demographic.

4. Function over fashion

After you’ve narrowed down your list of potential names, it’s important to put these names through some hoops to ensure that they resonate with your customers. A major aspect of brand naming that many people don’t consider is functionality. In naming, functionality refers to how easy it is to communicate your name through speech and print.

There are three main parts of functionality to consider:

  • Read to speak: Can people easily say the name aloud after reading it? Do they pronounce the name correctly?
  • Hear to spell: Can someone easily spell your name after hearing it? Would they be able to Google search it after hearing it once or look your business up on social media?
  • Speak to hear: Discover if your name passes the “crowded bar test.” Would someone be able to clearly understand your brand name even if it was spoken in a crowded bar? Would whoever heard it be able to repeat the name back in the same situation?

If you want people talking about your brand and spreading organic referrals, then you need to make sure that your brand name is highly functional. In order to create a name with a long-term impact, it must be clear and functional as well as communicate the core values of your business.

In addition, your name must stylistically match with the tone of your company, allowing the name to form a true connection with your target audience. By following our guidelines, your buzz-worthy brand name will promote interest as it encompasses your brand’s unique journey.

RELATED: 5 Rules of Thumb for Choosing the Best Domain Name for Your Business

About the Author

Post by: Darpan Munjal

Darpan Munjal is the founder and CEO of, the world’s #1 brand naming platform and two-time Inc. 500 company. He frequently contributes thought leadership content on branding, naming, entrepreneurship, and technology to major publications including Forbes and Entrepreneur.

Company: Squadhelp
Connect with me on Facebook, Twitter, and LinkedIn.

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