Tronc – How (Not) To Name A Company In The Digital Era by Knowledge@Wharton
Got game with your name?
In the digital era, executives are discovering that there is more at stake in selecting the right name for a company, product or service than in the pre-Internet era, but the path to follow is often laden with new rules that can make the task at hand more treacherous, say Wharton and other experts.
Earlier this year, old media stalwart Tribune Publishing Co., owner of the venerable Los Angeles Times and the Chicago Tribune, stumbled badly when it renamed itself “tronc,” a short version of Tribune online content. The name change was supposed to represent the company’s shift to the high-growth online content business. But it attracted instant derision instead, with The Washington Post opining that “Tribune lost its mind.”
While Tribune recognized the need to get with the times and present a more modern image, its attempt to follow the new digital rules for branding while still honoring important aspects of the old rules was less than gracefully executed. At least, it understood that choosing the name of a company or product is becoming increasingly more critical. That’s because a company’s name is usually also its web address, so choosing a name people can remember should bring in more traffic — translating to higher revenues.
“Name selection is more important now than ever before,” says Alexandra Watkins, founder of brand consulting agency Eat My Words. “Your name has to work harder than it did 20 years ago.”
“Name selection is more important now than ever before. Your name has to work harder than it did 20 years ago.” –Alexandra Watkins
Driving the charge are shifts in technology and consumer habits. The ubiquitous presence of internet domain names and web addresses, or URLs, social media and the prevalent use of smartphones and tablets with their smaller screens call for new rules on how a company, product or service should select its name, marketing experts say.
“Yahoo! started this shift in early 2000 when it was formed and disrupted the conventions of naming companies and logos,” says Sinan Kanatsiz, chairman of the Internet Marketing Association. Yahoo stands for “Yet Another Hierarchically Organized Oracle.” At the time, it was a bold move for a company to give itself such a whimsical name with no obvious link to its core business — flying in the face of old rules that include naming a firm after a founder. “The trend is toward simplicity and using acronyms,” Kanatsiz notes.
Domain Name Dance
Unique URLs that are easy to remember and build on the company’s name, mission or brand tend to drive potential customers and partners to the organization’s website, where information can be provided about the firm or where its products and services can be sold.
Wharton marketing professor Jonah Berger believes that names help brands represent what they stand for, which in turn impacts choice in the marketplace. “Intel picked the name Pentium [for its chips], because it sounded fast and high tech,” he says. “Buick picked the name Enclave because it sounded roomy and hip.”
In a research paper titled “Empirical Evidence for Domain Name Performance,” Karl Ulrich, vice dean of entrepreneurship and innovation at Wharton, found several traits in selecting a domain name that attracted more traffic to a website:
- Short names. Domain names of seven characters or less, excluding the dot.com or other suffix, tended to yield higher traffic. Visitors to a website would decrease by 7% if the domain name was expanded to 10 characters, Ulrich says. Basically, that translates into a 2% reduction in traffic for each additional character beyond the sweet spot of seven characters or less.
- Numbers count. Adding a number to a domain name also helped increase traffic, the paper found. Include a numeral and the website’s rank would rise by 8.19%, based on a study of 1.28 million unique domains that were ranked according to the amount of traffic they attracted.
- Ditch hyphens. What about the lowly hyphen? It can lower a website’s rank by 2.9% if one is used in the domain name, according to the study.
Leonard Lodish, Wharton emeritus professor of marketing, notes that sometimes names are intentionally misspelled because the URL for the word in the right spelling is not available. But then, the company has to spend to build its brand identity. “In some cases, the URLs are taken so companies have to spell their names funny. It’s the cost of doing business and it hurts, not helps,” he says. “Like Uber and Amazon, companies like these have to spend a lot of money to let people know what they stand for.”
“The trend is toward simplicity and using acronyms.” –Sinan Kanatsiz
Lodish was the first outside director for Diapers.com, which initially got its start as 1-800-Diapers in 2005 but then two years later purchased its current domain name. He says the new name made the company more efficient, because it had to spend less money to acquire new business. “A good name should differentiate the company, or product, and be memorable just from the name,” he says. “Your target audience should understand why the company or product is better than the competition.”
If your company’s name is not available as a domain name, find creative ways around it. For example, luxury condo complex Lumina in San Francisco was not deterred when a technology company with the same name snapped up the Lumina.com domain, Watkins says. It grabbed LuminaSF.com. Pharmaceutical giant GlaxoSmithKline chose BigBadCough.com to tell the public about the dangers of whooping cough and the need for people to get a vaccine, instead of using a URL with its corporate name, she adds.
“Don’t let the availability of your dot-com [name] stop you from [creatively choosing] a great domain,” Watkins says. “About 90% of our clients get it that it is OK not to have the exact same domain name, but the startups, especially, don’t get it.”
However, the URL should be associated with the company’s name and be unique, says Wharton marketing professor Barbara Kahn. “You want to get them to your website,” she explains, noting how Spotify is a unique URL of a made-up word. Indeed, company names that are comprised of words not found in the dictionary are common in the digital era — in part, because firms are determined to land a web address that is still available. “The biggest trend in selecting names is a move to use made up names,” she says.
Siri and Tiny Screens
With voice recognition features becoming commonplace, in part spurred by the popularity of the iPhones’ digital assistant Siri, it is becoming imperative that the name of a company sounds exactly how consumers would pronounce it, advises Watkins. For example, people looking for the Mexican restaurant Garaje in San Francisco could mispronounce it and confuse the voice recognition software used to find the eatery.
“In some cases, the URLs are taken so companies have to spell their names funny. It’s the cost of doing business and it hurts, not helps.” –Leonard Lodish
The tiny screens of mobile devices also make name selection more challenging. According to research firm Gartner, 1.5 billion smartphones are expected to be sold worldwide this year, up 7% from the previous year. That means companies will likely want customers to read their name easily and quickly on those small screens, experts say.
“The trend in mobile is to look at the screen quickly and, so, you’ll want [consumers] to be able to process things quickly. It’s called perceptual fluency,” Kahn says, pointing to the ease with which a person is able to read a company or product name from the way that it is spelled to the type of font used. Moreover, a short name is also easier to read across the screen of a smartphone, Watkins notes, and a made up name could better fit the bill.
However, in the quest for sizzle do not forget substance. Kanatsiz says that a sexy digital name and logo will likely get prospective clients and partners to click on your website or links, but it won’t get the same type of traction as useful information presented in an appealing way. “Millennials don’t care about names or logos. It’s all about the experience,” he adds. “They are more likely to share if something has utility. That’s what is more important.”