Acronyms Are Brand Killers
The problem with acronyms in a business or trade name is that they kill your branding. You have an opportunity in a trade name to say something memorable and meaningful about your business. A group of letters says nothing and loses an opportunity to communicate your message.
Acronyms are strangely popular in four industries:
> Financial – Every business stock has a symbol, which is an acronym.
> Medical – Acronym is a second language that you have to speak fluently.
> Construction – Construction people seem to lack the naming chromosome.
> IT – Let’s face it. In the IT world, acronyms have become a disease.
Why do People Resort to Acronyms?
There are three reasons:
- Acronyms are a shortcut for brand killers – the generic, painfully boring name. For instance, International Business Machines is IBM; General Motors is GM; General Electric is GE.
- People hate names that exceed 3 syllables. What they actually call your company – your “handle” – is always subject to reduction. If you don’t have a good handle for your company, it will result in an acronym. A company called Executive Headhunting International will inevitably be called something shorter, like EHI, and will lose any chance at a meaningful, memorable brand.
- 3. If you become the “800 Pound Gorilla” in your vertical, everyone will attempt to reduce your name to an acronym. In politics, when John F. Kennedy, or Lyndon Johnson became president the public lexicon reduced them to JFK and LBJ.
So What if the Name is Hard to Remember
Branding, marketing, and selling are purely a memory game. On average, any marketing initiative gets an immediate 1% response – in the remaining 99% you may have more customers but they have to remember to buy from you. If people don’t remember you, the game becomes that much more expensive in time and energy. When 4 out of 5 new businesses fail within one year, there is little room for error. A memorable, meaningful brand name can make a huge difference.
But What About IBM? They Didn’t do so Badly.
The name IBM came into being in 1924. In that year there were less than 1,000 trade name applications. Now, there are over 350,000. Currently, a mind boggling 35 million domain names are reserved. (This explains why domain searches for something like “Blue Zebra Umbrellas” are already taken.) So IBM flourished in a relatively tiny universe of trade names – nothing like the galaxy of trade names that face today.
Acronym fans please note that IBM has a colorful, two syllable nickname “Big Blue” directly connected to their branding. IBM’s blue logo, a patented shade of blue, signature blue business suits and blue mainframe computers helped them launch above the acronym handicap.
So Having an Acronym for a Business Name Invites Failure?
Not always, but why take the chance? Let’s flip it and look at the 100 fastest growing businesses in the United States. You will find that 92% of the business names are not acronyms. And if we eliminate the four notoriously acronym-happy industries – financial, medical, IT, and construction – there are no fast growing companies using an acronym name.
Brand well and prosper!
Andy Cleary