The New Yorker has an interesting article on brand naming, i.e. how those brands get named — Famous Names: Does it matter what a product is called? (subscription required). The story focuses on the work of David Placek and his company, Lexicon.
As the article describes, brands have been around forever. But the art of coming up with that perfect name is relatively new:
During the sixties and seventies, companies looking for brand names increasingly turned to Madison Avenue advertising agencies, with their professed expertise in the collective unconscious of the buying public. Snappy, “Mad Men”-style initialisms became popular: A.T.&T., 3M, I.B.M., G.M. With the mergers-and-acquisitions boom of the nineteen-eighties, brand names took on a new importance. “A lot of value that was being paid for companies was for their brands,” Kevin Lane Keller, a professor of marketing at Dartmouth College says. “There was no other way to justify paying x billions of dollars for this company from just the physical plants, equipment, and everything else. It was intangible assets.” In 1982, amid this new interest in brand naming, Placek launched Lexicon, which was among the first companies in the United States dedicated solely to the practice.
Now, I would not down play the importance of the intangible asset of the name. The wrong name can harm a product, just as the right name can boost it. But, like with all advertising, it is often difficult to know how much the name contributed to a product’s success or failure.
I would also take issue with Professor Keller’s implication that the brand was the sole intangible asset in play during the M&A boom. A number of other intangibles, such as technology and customer relations, are also factors. Technology may be a bigger factor today. There was also what I would refer to as froth: companies buying up and bidding up other companies for the sake of buying up and bidding up other companies.
Still, the name is important. And the New Yorker piece is a fascinating insight on how the naming game works.
PS — for a fictional take on the subject, I would recommend the novel Apex Hides the Hurt by Colson Whitehead. It is the account of a nomenclature specialist brought in to decide the name of a town split among three factions.