The Conference Board Review

May / June 2007

Now What Shall We Call This Widget?

Why companies come up with good names, bad names, and terrible names.

By Theodore Kinni

Theodore Kinni has authored and ghostwritten ten business books, including, most recently, No Substitute for Victory: Lessons in Strategy and Leadership From General Douglas MacArthur. He reviewed Alpha Male Syndrome in the Sept/Oct 2006 issue.

George Eastman's dry-emulsion film simplified and popularized the art of photography. In 1888, he registered the trademark Kodak to identify his film and the cameras that used it, and began advertising their ease of use: "You press the button, we do the rest." By dint of his prodigious brand-building genius, the Eastman Co. soon laid claim to the leading position in a field of more than fifty competitors.

Today, the film that created a corporate giant is tottering toward buggy-whip status, but the name Eastman chose still has legs. In 2006, even in the midst of the turmoil caused by the digital revolution, the Kodak brand ranked seventieth in the world in value, with an estimated worth of $4.4 billion, according to the annual Interbrand Corp./BusinessWeek brand survey. Not a bad return on a manufactured word.

Over a century ago, Eastman approached the naming process in much the same way that many of today's brand and trade namers recommend -- playfully. According to company lore, he conjured it during a game of anagrams with his mother. He started with a letter. "The letter K has been a favorite with me -- it seems a strong, incisive sort of letter," he said. "It became a question of trying out a great number of combinations of letters that made words starting and ending with K."

It sounds rather arbitrary, but Eastman had other reasons for settling on Kodak. "This is not a foreign name or word; it was constructed by me to serve a definite purpose," he explained on registering his trademark in Great Britain. "It has the following merits as a trade-mark word: First. It is short. Second. It is not capable of mispronunciation. Third. It does not resemble anything in the art and cannot be associated with anything in the art."

Simple, right? Find an original name, register it, and get to work building your own billion-dollar brand. If only things were that easy today.

"Hitting the Trifecta"

Eastman had one big advantage in the name game: He didn't have to contend with millions of already-established and legally protected names. In fact, the first U.S. trademark wasn't issued until 1870, and shortly afterward, the law that made that possible was struck down as unconstitutional. It wasn't until 1881 that a new, improved law was passed. Today, on the other hand, more than a quarter-million trademark applications are filed annually at the U.S. Patent and Trademark Office. Last year, the second-busiest for applications in U.S. history (after a banner year at the height of the e-commerce boom in 2000), the USPTO reported that it received 275,790 applications, bringing the active, pending, and dead trademarks on file to more than four million.

"By historic standards, it is almost more difficult than ever to get a trademark," says Glenn Gundersen, partner in charge of the trademark/copyright practice at Dechert LLP and author of the international law firm's annual Trends in Trademarks report. "Part of the factor is that people can go and file for a mark that they are considering using, and maybe 50 percent of those applications fall away without the applicant ever using it. But as long as somebody has an application pending, it's a potential roadblock."

Now, take those pre-existing names and add the myriad names required for the endless stream of new products, services, systems, and businesses created in the United States each year. Then multiply that sum by the globalization factor. After all, if you want to sell your widget around the world, you must either find a name that is compelling and legally unencumbered in the ten or fifty or however many different countries in which you plan to market it, or you must come up with a number of different, but still great, country-specific names for the same widget. And, by the way, you must also contend with all of the businesses around the world that are trying to come up with their own great names.

"This bombardment of names creates a high hurdle for actually christening new products and services, or names for new companies," says Glen Rock, N.J.-based brand consultant Steve Rivkin, co-author of The Making of a Name. "A new name has to hit the trifecta: It has to be available, it has to be distinctive, and it has to be memorable."

In the Name of Money

Over the past couple of decades, the growing odds of hitting this trifecta have transformed the name game into an endeavor that typically requires specialized assistance. In response, global brand-management consultants, such as Landor Associates and Interbrand Corp., began to prominently feature naming on their menu of services. And specialized boutiques sprang up as well, often sporting offbeat monikers designed to leave no doubt about their creative capacity, such as Igor International and A Hundred Monkeys.

As you might guess, the price of conjuring a good name has risen along with the job's complexity and the field's professionalization. "I am guessing the minimum you are going to pay one of these established firms will be approximately $25,000," says Alex Frankel, author of Wordcraft and founder of Quiddity, a naming firm that opened and closed with the dotcoms. "I saw that Zune, Microsoft's version of the iPod -- and notice that I have to use Apple's iPod to even tell you what Zune is -- cost $200,000 to name." Indeed, last November, Dow Jones reported that Lexicon Branding, which named the Zune, as well as the BlackBerry, Intel's Pentium, and GM's OnStar, charges about $150,000 for a name.

Is it worth that kind of money to come up with a name? The jury is still out in the case of Microsoft's Zune. If you see the name as simply tune with a "z," you might conclude that its cost was excessive. If, however, you see the name as a product of expert knowledge and comprehensive research that can help differentiate Microsoft's offering among consumers and lure them from Apple -- and that the name can become a verb ("I just zuned you the new U2 single") -- and that is capable of supporting what Robert Bach, president of Microsoft's entertainment and devices division, characterized as an investment of hundreds of millions of dollars, then $200,000 sounds like a drop in the bucket.

If You Don't Have Anything Nice to Say . . .

No one is suggesting that a great name can make a substandard product or company great. Ask Intel, which made implicit promises of state-of-the-art performance with the "Pentium" name. In 1994, to preserve its brand, the company was forced to undertake a $475 million recall of chips because of a bug that the vast majority of its customers would never encounter. Google, as another example, became part of our vocabulary not because it's a great word but because the company built a great search engine. If the company's search algorithm hadn't been so amazingly comprehensive, Google would be another also-ran in the search business, just like Snap and Direct Hit and Infoseek.

A bad name, on the other hand, can hurt or even kill a product or company. Back in 1996, Reebok created a women's running shoe and named it Incubus. No one knows what possessed Reebok to ignore the dictionary during the naming process, but the company failed to discern the word's definition until the first day it advertised the shoe. "We apologize," announced chagrined PR director Dave Fogelson. "Certainly, it is very inappropriate." He told Reuters that the company had to come up with 1,500 new names annually and thought it had a winner -- one that no other company had thought to trademark. "Obviously it became very apparent to us yesterday why nobody else was using the name," Fogelson said. Reebok recalled 53,000 pairs of the shoes inadvertently named after a mythical demon that seduces sleeping women.

"In some cases, a name can clobber a product just getting out of the box because it is so grossly inappropriate," Rivkin says. "There are some names that are outright hideous. The British shoemaker Umbro named a brand of shoes Zyklon, the name of the poison gas that the Nazis used at Auschwitz. You put Zyklon into Google or any search engine, and I guarantee eight of the first ten hits that you get will say Holocaust, Nazi. How could anybody not have done that?" After the Simon Wiesenthal Center protested and the media picked up the story in 2002, Umbro apologized and renamed the shoe.

Not all naming gaffes are so egregious. More often, they just make it a little bit tougher to attract customers and sell your product. I can't pass a KIA dealership without thinking "killed in action," surely not a connection that the Korean carmaker ever intended. It's just one example of the translation problems that run rampant in the global name game these days.

Rivkin ran into another translation snafu while leading a naming workshop in Kuala Lumpur. He was describing how Mitsubishi was selling the same SUV in various regions under different names -- Montero in the United States, Shogun in the United Kingdom, and Pajero in Asia and Australia, when a group of Latin Americans in the back of the room began laughing. They refused to say why but suggested that he look up pajero in a Spanish dictionary. It turns out that the word, when used as slang, means a masturbator. "Mitsubishi just didn't think about the Spanish audience apparently," says Rivkin, who asked the company about its choice of name but received no reply. (On the company website, Mitsubishi claims to have derived the name from the South American feline Felis pajeros.)

The obvious point is that the name of your product or company should be working for you, not against you. Choosing a name thoughtlessly or without expert assistance makes it more likely that you will end up with the latter result.

What's in a Name?

Herein lies the rub, to misquote Shakespeare. It's easy to point out a great name and construct a highly rational argument for why it's great . . . in hindsight. I initially thought BlackBerry was a silly name. The name didn't intrigue me enough to bother to figure out what this new gadget was -- until it was selling like hotcakes. But now I realize that its tiny keys are like a blackberry's seeds, that the name evokes the coolness of Apple's products and, by extension, the Beatles' Apple Corps, and that, in some odd way, it's natural, organic, and friendly. Of course BlackBerry is a great name!

Alex Frankel calls Viagra -- with all that vitality, not to mention the power of Niagara Falls -- another great name. "The name allows the company to own a large share of the market by being the first thing that people think about [when it comes to treating impotence] and emerging as a generic name for the product," he says. "By creating a great name at the outset, you pave a pathway for success. A name like Viagra would move from one person's mouth to the next and just spread like wildfire. It helps to build market share quickly."

But did it really matter what the first pill to cure male impotence was named? Wouldn't it have been the subject of a googol of late-night talk-show-host jokes no matter what its name? After all, there are plenty of bad names that turn out good.

Last fall, Nintendo announced that its new game platform would be named Wii. "Wii sounds like 'we,' which emphasizes this console is for everyone," the company painstakingly explained. "Wii can easily be remembered by people around the world, no matter what language they speak. No confusion. No need to abbreviate. Just Wii. Wii has a distinctive 'ii' spelling that symbolizes both the unique controllers and the image of people playing it."

Everyone hated the name, and Nintendo faced a firestorm of criticism. "Think of all the objections," says Steve Manning of San Francisco-based Igor International. "Not only is it slang for urination, but Nintendo also had this problem where they were perceived by gamers as skewing to a younger audience, while the company was really trying to elevate the product to an older audience, a segment that they haven't been able to tap into. That was a huge controversy."

But the controversy turned out to be a PR bonanza for Nintendo. When Manning wrote a blog post suggesting that the name was so bad that Nintendo must be "punking" its customers and would announce the real name when the product shipped, his readership jumped six-fold to thirty thousand page views. "Nintendo didn't have to put a dime behind it," says Manning. "All they had to do was say the new name is Wii and it just lit up the Internet, and the press as well, because everybody came out and said, 'What a crappy name.' Every single member of their target audience knew that name within twenty-four hours and were never going to forget it." Nintendo sold 1.14 million units of the game console in Japan by January 7, 2007, more than twice as many units as Sony's new console, which was on store shelves three weeks before Wii.

The bottom line: The vagaries of naming are legion.

Getting Good Marks

Other than the fact that great names are easy to identify after they've become hits, what can be said for sure about crafting winners? For starters, context is everything. First, there is the product or company itself to be considered. Thus, while Incubus is a great name for an alternative rock band, naming a sneaker after an evil spirit that attacks your intended customers in their beds was clearly not so great.

There is also the competitive environment to consider. "Take the SUV category, where everything is positioned exactly the same: the great outdoors," Manning says. "There are probably a hundred names that are Mountaineer or Explorer or Navigator or Rainier or Tahoe or Sonoma or whatever. And the question becomes: What is the equity in being the 101st SUV that is saying exactly the same thing to exactly the same audience in exactly the same way? Frankly, I think in the SUV category, the best name is still the Suburban. It's the only different name, and it's the only one that is brutally honest. We are not really driving up the mountain in these trucks."

Next, great names launch with great marketing strategies or, at the very least, should flow from some sort of predefined strategy. For instance, luxury carmakers such as BMW and Mercedes and Infiniti concentrate all of their marketing might on promoting their corporate names. Their cars, named with letters and numbers, such as BMW's 3 Series, 5 Series, etc., all derive benefit from the value of the larger brand. (That doesn't mean that they don't take their model names seriously. Infiniti reportedly paid San Francisco-based NameLab $75,000 for two letters -- the J and the Q that would lead -- not follow, mind you -- their model numbers. The carmaker has since moved on to G, M, and F.)

Experts call this a "naming architecture," and having one creates a sort of brand consistency that customers come to recognize. "This is something that I appreciate as a consumer," Frankel says. "If sub-brands are all scattered, it's harder as a customer to know what is going on." Thus, Apple is following the iPod with the iPhone.

Finally, think about the type of name you want. There are basically three categories of names: descriptive, as in Close-Up toothpaste and Sears' Weedwacker; invented, such as corporate names Lucent and Integris; and evocative, such as Apple and Monday, the new name Pricewaterhouse-Coopers chose just before IBM acquired the consultancy and put a quick end to that flight of fancy. Most naming experts tend to favor and be especially good at coming up with one of these types, so research naming companies before you choose one, because mismatches are often a colossal waste of time and money.

"Spend some amount of time and get comfortable with the people who run the firm and who are going to be working on the assignment for you," Rivkin says. "Otherwise, you are likely to have a huge disconnect -- the classic example being somebody who has done nothing but dotcom kind of entity names who is now trying to work for a traditional industrial heavy-machinery company. One is not right, one is not wrong, but they may not be destined to work well together."

Of course, if you end up with one of the winners, it's worth all the effort. Names like Absolut vodka and DieHard car batteries and Hefty trash bags all captured substantial shares of competitive markets, in no small part due to their names. "Evaluate your own vocabulary in a sense and see how many brand names you are using on a daily basis," suggests Frankel. "Everytime somebody goes to the wireless-retailer store and says, 'Give me a BlackBerry,' even if there are other makers, it helps Research in Motion," the item's lesser-known manufacturer. "Five years ago, Google was not a verb, and now it's everywhere. That verb usage was part of the Google success story."

Sidebar: A Red by Any Other Name

Razzmatazz. Manatee. Inch Worm. These are just a sampling of Crayola's newer colors. Whatever happened to red, blue, and yellow? They're still there, of course, but over the years, they've been joined by Jazzberry Jam and a rainbow of other ambiguous hues. But why would Crayola come out with names that don't describe their crayon colors? Because when it comes to using color -- and flavor -- to name products, the more imaginative and non-descriptive the name, the likelier consumers are to prefer the product. And we're not just talking crayons.

From Ben & Jerry's Chubby Hubby ice cream to Gatorade's Riptide Rush sports drink to nail-polish manufacturer Hard Candy's shade of Trailer Trash, vague color and flavor names proliferate in the marketplace. "I was curious about all these weird names," says Elizabeth Miller, assistant professor of marketing at Boston College, "and wanted to find out how they were affecting people's purchasing and preferences." When Miller, along with Wharton marketing professor Barbara Kahn, conducted a study on the effect of color and flavor names on consumer choice, they discovered that consumers are increasingly drawn to offbeat names that give little information about a flavor or product color.

For example, when Miller and Kahn held an experiment with jellybeans, they found that people were more apt to choose moody blue, Florida red, and monster green than the more typical and descriptive blueberry blue, cherry red, and watermelon green names. In a second experiment, participants were asked to order sweaters out of a catalog without seeing the actual colors. Again, Miller and Kahn found that, rather than choose sweaters with descriptive colors like dark red and light brown, people were more apt to pick sweaters labeled antique red and lucky brown. On top of that, individuals were likelier to order greater quantities of the ambiguously named sweaters.

"People are always trying to figure out why a marketer chose a name," Miller explains. At the same time, she adds, "they know that marketers exist to try and sell a product, so people figure that there must be some positive reason why a marketer chose an unusual name." Though they may not understand that reason, an ambiguous name tends to pique their curiosity. Therefore, why label a product yellow or lemon yellow or even rainslicker yellow when you can call it party yellow?

But before you start attaching strange color and flavor names to your products, Miller is quick to point out that such naming strategies don't always succeed. "Unusual color and flavor names work best for hedonic product categories, like fashion and food goods," she cautions. But they wouldn't work in other product categories. Razzmatazz Health Insurance or Inch Worm Savings and Loan, anyone? -- Vadim Liberman

Sidebar: When Pudding Becomes Satin Chocolate Pudding

Historically, it's been tough to accurately quantify the impact that a product or company name has on customers. But recent scientific studies have begun to lend credence to the idea that names can deliver profits in and of themselves.

In 2001, Cornell professor Brian Wansink and two colleagues published the results of a study that found that cafeteria patrons (in this case, mostly university professors and other education professionals) buy more, eat more, and come back for more when menu items such as chocolate pudding are renamed, say, Satin Chocolate Pudding. The researchers found that descriptive labels, including Grandma's Zucchini Cookies and Tender Chicken Parmesan, increased sales by 27 percent, enhanced post-trial evaluations of quality, value, and restaurant-related attitudes, and bolstered customers' intentions to return to the cafeteria.

In 2006, another research team, this one from Munich's Ludwig-Maximilians University, announced that it had discovered that when people hear or see popular brands, the parts of their brains linked to self-identity and reward light up. Well-known brands -- regardless of the product -- activated parts of the brain associated with positive emotional processing; less familiar or unknown brands activated parts of the brain associated with negative emotional response. -- T.K.

Sidebar: In the Name of Killing Time

Naming projects can easily become sinkholes of lost time and resources. Just ask Greg Pruett, who spent twenty years involved in a series of renaming initiatives at Pacific Gas & Electric Corp. before joining the American Gas Association as vice president of communications.

"It started all the way back in 1987," Pruett recalls. "PG&E had had the same identity since 1905 -- identified by a 'P,' a 'G,' the word 'and' with a tilted underscore under it, and the letter 'E,' all in brown and light beige with a light beige backdrop. At the time, the chairman and CEO determined that he wanted to look at whether or not we should change the name of the company, change its visual identity, reposition the way the company was visually presented to customers, investors, etc." At the end of that effort, the company did change its visual identity -- but not its name.

In 1995, the name initiative resurfaced as the company diversified into other businesses. "We retained a consultant and again spent a great deal of money on a study," Pruett continues. "The consultant came forward with many names, many identity treatments. And at the end of the day, I still remember how the chairman picked up the binder, which was pretty considerable, like a New York White Pages, and said, 'I like our current name. I see no reason to change it. Thank you.' He dropped the binder on the boardroom table and walked out of the room, and that was the end of that."

That chairman was gone by 1997, when the idea of a new name surfaced once more. "We had a new chairman and CEO who was very much of a like mind to the previous one -- that this is a big waste of money," Pruett says. "But he commissioned me to take a look at how we branded the non-utility business units we were creating." This time, California's utility regulators threw a monkey wrench in the works. When PG&E decided to extend its brand across all of its businesses, state regulators insisted that the state's citizens owned a share of that name and demanded royalties, in addition to other onerous conditions. Two more years flew by.

"Finally, I think the chairman got sick and tired of hearing me gripe," Pruett says. "He said to me, 'OK, I am going to authorize you to go out and hire somebody to take a look at recasting the identity of the parent company.' And he looked me in the eye and said, 'And I don't want anybody to come in here and start talking to me about branding. I don't want to hear the word branding. Do you understand?'"

Surprisingly, it worked. "We identified a name for the new company, we identified a ticker symbol and reserved it, we had this name translated into fourteen languages, and it just came through with flying colors," Pruett remembers. "We were all set to launch. Then the California energy crisis unfolded before our very eyes, which drove PG&E and, ultimately, the non-utility units into bankruptcy and forced the company to divest itself of the non-utility units. So there was no point in changing the name then."

The total cost of these exercises in frustration? Over $12 million, according to Pruett. The lesson for companies considering name changes? "Right at the very start, before you do anything, including hiring a consultant," he instructs, "get uniformity of agreement internally." -- T.K.