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September 7, 2006

Branding Yourself by Hiding Your Name

Names have held power since time immemorial. We say “Speak of the devil” when someone we’ve just been talking about walks up to us because of an old belief that speaking the true name of a supernatural being would summon it.

RumpelstiltskinFairy tales like Rumpelstiltskin demonstrate a tradition that knowing someone’s true name gives you power over them. Therefore people avoided speaking the true name of anyone (or thing) that they feared and avoided telling their own names to potential enemies.

Modern businesspeople are not supernatural beings, but very often the name we know their business by is not the legal name of the business. The purpose of adopting a fictitious business name is not to avoid hostile spells, but to create or maintain a brand.

If you’re a sole proprietor and you name your business “Joe Smith” after yourself, it doesn’t tell prospective customers anything about what you do. And in most cases, you can’t trademark a personal name. Another person with the same name can open the same kind of business using that name, and you can’t do a thing about it.

SkypeAt the other end of the size spectrum, a large company which buys a smaller company may want to continue trading under the subsidiary’s name in order to hold on to the existing customer base and brand equity. When eBay bought Skype, they didn’t rename it or do anything else to change the way the product worked at the consumer end.

Unlike supernatural beings, businesspeople are not allowed to hide their real names from the public. Fictitious business names in the United States are registered with the County Clerk. Some states also require those who file for a fictitious business name to publish an announcement of the fact in the newspaper, along with the real legal name and contact information for the business, including the name of the person who acting as agent.

Saying the legal name of a business doesn’t cause the CEO to appear in your living room in a puff of smoke, but knowing it does give you the power to issue a summons.

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Posted by Diane Prange at September 7, 2006 5:14 PM
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