I recently looked at the names of “The World’s Most Innovative Companies” in FastCompany magazine (March/April 2021) and noticed something. Almost everyone had an arbitrary (not related to the good or service, e.g., Apple for computers) or fanciful (made up like Exxon or Slack) name. For example, “8th Wall” is a telecom tech company, “Credo” is a beauty brand, “Seventh Generation” is cleaning products, and “Lynx” is fleet management software. All of these innovative companies do not use descriptive branding.
Descriptive Names Make Sense
Of course, when you are starting a brand, it seems logical to have a more descriptive name so more customers can immediately find you. Examples of descriptive names are Best Shoes, Cooler Air Conditioning, Sunblock Sun Screen, and Better Air Air Freshener. In the world of trademark law, a mark is considered merely descriptive if it describes an ingredient, quality, characteristic, function, feature, purpose, or use of the specified goods or services. See In re TriVita, Inc., 783 F.3d 872, 114 USPQ2d 1574 (Fed. Cir. 2015). There is little doubt that a consumer who sees Best Shoes would know that it is a brand for shoes and understand the positive characteristic of the shoes.
“The issue is that descriptive marks are very hard to obtain and ultimately enforce.”
The issue is that descriptive marks are very hard to obtain and ultimately enforce. Trademark law mandates that a descriptive mark must acquire distinctiveness to the point the trademark has acquired secondary meaning. So, for example, when all of us think about American Airlines, we are not thinking about any airlines in the U.S.; we are thinking of the brand, American Airlines. The same holds true with International Business Machine (IBM) Coca-Cola (not just a cola made out of coco leaves and the cola nut).
“However, unless the brand has been around forever or is famous, a descriptive mark is not going to ultimately protect the brand very effectively.”
As far as enforceability, even if a company can prove acquired distinctiveness (which requires a minimum of five years of exclusive use in the United States), the protection is very limited, and descriptive marks are considered by the courts to be generally weak. For example, arguably Better Shoes could register, so could Best Air Air Freshener, etc. However, unless the brand has been around forever or is famous, a descriptive mark is not going to ultimately protect the brand very effectively. This may end up being a significant issue when it comes to growing the brand and protecting against infringement.
Arbitrary and Fanciful Marks Stand Out
So think about it, innovative and successful companies build their value propositions around arbitrary or fanciful marks, which they protect relatively painlessly through trademark registration. This is not the only way to go, but in my experience, it has led to far higher overall company value in the long run.