The Rebranding Game by Ryan McCarthy at Inc magazine focuses its attention on Simulscribe, a company who rebranded and changed their name to PhoneTag several months ago.  Inc also ties in a secondary article to this story which attempts to advise entrepreneurs on how to buy domains. While the advice on buying domains isn’t the best, the article on rebranding provides start-ups and businesses with an interesting perspective from a company who chose a ‘bad’ name and struggled with coming up with a new and better name.
We’ve all heard start-up stories about companies struggling to come up with a name, often opting for a less desirable choice. The most common gripe being “All the good domains are taken”. Andrew at Domain Name Wire has points out some of the more ridiculous names that start-ups have chosen. Obviously a lot of start-up companies, like Simulscribe, get stuck in this same boat when they launch. Maybe they aren’t creative or maybe they can’t get “their name”. They end up going with whatever they consider to be the next best thing. What’s even more likely is that most start-ups don’t even consider budgeting for a name or a domain name. “Almost all of the start-ups I’ve worked with have started with really bad names but waited until they were more advanced to seriously think about marketing and branding,” says Danny Altman of A Hundred Monkeys, a naming firm.
So, why get the right name at the start? It can be argued that you can create the next great site, product, application, etc. with “any old domain name”. You’ll save a lot of money by using a made up, hard to spell, formerly useless name. The Simulscribe story points out that a bad name can create more problems as your company grows and becomes successful.
it was hard to remember and easily mistyped. Given that the company’s strategy was to build a user base primarily through word of mouth, this was bad news. “If you’re selling a product on the Web that you want people to talk about, the name is the most important thing,” Siminoff says.
Siminoff talks about the impact of the rebranding
So far, the retooled brand seems to be a winner. In the six months since SimulScribe became PhoneTag, the number of daily sign-ups has risen 40 percent, and the number of accounts produced by customer referrals has tripled. Revenue is on pace to hit $5 million this year. “The name change has made an enormous difference,” says Siminoff.
and reflects in hindsight on the lack of a good name choice early on.
“I think we’d probably be double or triple the size we are now, had we had that name a year ago.”
Obviously, a rebranding effort takes a great deal of work and expense. Inc doesn’t really talk much about the expenses of the ordeal but one can figure that it’s likely much more costly than getting it right the first time. Think about mindshare and the time it takes to gain that. A new name means people are likely to get confused. They can also lose confidence. Think about what customers might say after a name change. “What happened to Simulscribe?” or “What is this PhoneTag business all about?” Branding is about associating a name with a concept. Changing the name obviously is like starting completely over.
Siminoff spent over a year working on a new name as his investors “clamored for a change”. This amount of time is something most companies likely can’t afford to devote to a name change. The direct expenses of a name change begin to add up as well. Buying the domain name was only one expense that Siminoff faced in having to rebrand his company. The article mentions that he was able to incorporate the new name in to the logo and web design. Most companies are likely not as fortunate. Often a renaming involves a new logo, website and collateral. As a company grows, the expenses associated with a rebrand are likely to grow as well. A larger company has more customers it needs to educate, more collateral it needs to amend and more mind-share it faces losing.
How to Buy A Domain Name
The Inc article does not go into detail about what exactly makes for a good or bad name. That discussion is best saved for another time as it is highly subjective. However, Inc does try to dish some advice for those who might be in these sames shoes, either branding or rebranding, and looking specifically to buy a domain name. They refer the reader to another article written by ‘Staff’ titled “How to Buy a URL“. The advice in this article isn’t really the best on this topic.
Inc tells readers to “Hang tight” and wait out ICANNs role out of new TLDs. This seems to be inappropriate advice give the topic. This article is about how to buy a URL, not how to sit and wait and possibly never get one. Waiting for a possible new domain extension to come out in the hopes that you are going to be the first to acquire it is not sound advice. Most domain extensions role out with a great deal of competitive speculation over the best domains. The premium domains could also be put up for auction or priced at a premium. The odds of getting the name are also outweighed by the inexperience most readers will have in figuring out the systems involved in the sunrise and landrush periods for any given new extension. If you need a name, waiting for a new TLD is not the best advice. Work with what you have in front of you now in terms of domain name extensions.
Companies should remember to choose an appropriate domain extension, more than likely choosing the .com. If the company is based in another country, maybe a ccTLD is more appropriate. I really wouldn’t advise a company to use a new extension, but that’s just me. You would likely get similar advice from others in the domain industry.
Inc really misguides and provides a disservice to readers in “How to Buy a URL” in their advice on pricing. Advice on how much to pay for a domain name shouldn’t be given in such an ambiguous, off-handed manner. “Pricing is tough” they state. Agreed. There is no rhyme or reason in many cases. The advice “For a niche term, don’t pay more than $5,000.” also seems to be a random number pulled from the air, if not naive. “Names with obvious commercial appeal will cost a lot more” also leaves the reader wondering “So, what exactly is a lot more?”
Advice for any novice would be to educate yourself and look for help. First educate yourself by learning about domain comparables and valuations to get a feel for what you may be up against in making an offer. For domain comparable pricing information , I’d refer interested parties to DnJournal’s weekly sales numbers and Namebio. Yes, you will see prices are all over the place, but lacking this information a buyer would be simply shooting in the dark. A domain name appraisal service can also assist a buyer in getting a feel for domain name values. In the end though, comps and appraisals only give you a rough idea. How much you want to spend is your call. I think Siminoff from PhoneTag puts it best in his comments at Tech Crunch
it just comes down to what the domain is worth to the business. In our case I would not be surprised if the name change is worth millions over the next few years. So while $30,000 is a lot of money for a good name I think it is cheap.
The Inc staff also leaves out the best advice for companies faced with the naming challenge: Look for expert help. If you are a company looking to rebrand or looking to acquire a specific domain name, look for help from someone experienced in this area. A domain name broker, a naming agency or a consultant can provide a great deal of insight, time savings and possibly even negotiate a better price. Brokers know many of the top domain owners and know what you can expect when dealing with specific parties. They are experienced in negotiation and the domain buying process. Naming companies can help you navigate through the process on what name to pick and what name will work best. A consultant often has the skills to do all of the above.
Full disclosure : the Simulscribe/PhoneTag story caught my attention because of the relation to the domain space and in naming in general, but I am also the former owner of PhoneTag.com. This isn’t the first domain I’ve sold. It isn’t the first to be used as a brand or a rebrand, but what I found important in these articles is the discussions on re-branding and mistakes. It’s also the first coverage I remember seeing the owner be so open about their naming mistakes and was willing to do it right the second time. Kudos to Siminoff.
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Original post by Adam Strong
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