What Makes a Good Company Name?

Companies, of course, put a lot of thought into what to name their company. It may seem like a simple task, but it can be harder than you think to come up with an original, concise name that people will remember.

This post discusses the 10 types of company names and the pros and cons of each. It gives some insight into what you need to think of when naming a company.

When I was a senior in college, I started an educational technology company with a couple of friends of mine from Walker. Our product was a website that would help all parts of a school community to communicate with each other efficiently (students, parents, teachers, etc.). The name we chose for the company was "learnection." It fits under the "Blends" category from the blog post I link to above -- like Microsoft and Netscape, it is a blend of two words: "learning" and "connection."

At the time, it seemed like a good, simple name that was halfway creative. However, there were several problems with the name after we looked back on it. First, it does not really roll off your tongue, and people were not always sure how to pronounce it when they read it the first time. When you think of the successful internet companies, it is abundantly clear how to pronounce Microsoft, eBay, Google, Apple and Amazon. Also, when writing "learnection" in certain fonts, the lower-case "L" at the beginning of the name would look like an upper-case "I" and that would really confuse people. Now, those considerations are not why the business did not last more than a couple of years, but it probably would have helped our marketing to have a simpler, catchier name.

What do you guys think makes a good company name? Can you think of any companies that succeed despite having an awkward or confusing name?

(Source: Guy Kawasaki's Blog)

Efficiency Wages at Costco

In AP Micro, we discussed efficiency wages, where a company pays wages that are above the market wage as a way of reducing turnover and because happy, appreciated workers are more productive. Here is an article that suggests that Costco pays efficiency wages relative to other warehouse stores:

And Sinegal says he's also built a loyal work force. In fact, Costco has the lowest employee turnover rate in retailing. Its turnover is five times lower than its chief rival, Wal-Mart. And Costco pays higher than average wages — $17 an hour — 40 percent more than Sam's Club, the warehouse chain owned by Wal-Mart. And it offers better-than-average benefits, including health care coverage to more than 90 percent of its work force.

Costco doesn't have a P.R. department and it doesn't spend a dime on advertising. There's a real business advantage to treating employees well, Sinegal said. "Imagine that you have 120,000 loyal ambassadors out there who are constantly saying good things about Costco. It has to be a significant advantage for you," he explained.

(Source: Greg Mankiw's Blog)

Beauty in the Eye of the Computer

Beauty is thought to be subjective and ideas of beauty can change over time, but there is some general consensus on what makes someone beautiful. Researchers in Tel Aviv have written a computer program (called the Beauty Function) that scans an image of your face and makes small adjustments to the picture to make you look more beautiful.

Some 250 measurement points were taken into account and once formulated, researchers developed an algorithm that could let them apply some of the desired elements of attractiveness - as mathematical equations - to a fresh image.

The article mentions that one practical application of the software could be for plastic surgeons. Any other commercial applications you can think of?

(Source: Marginal Revolution)

Confirmatory Bias

Last semester, we discussed biases and irrationalities that violate the rationality assumption in economics. Another common bias is confirmatory bias. This describes the tendency of people to look for information that confirms their preconceived notions or a decision they made.

An example used by Tyler Cowen on his blog is how people eagerly read advertisements for a car after they have already bought the car: they do it as a way of confirming that they made the right decision. Another example that is a little different is when people notice or comment on a piece of jewelry or an expensive piece of clothing on a Walker student because they believe that all students from private schools are all rich. In that case, they are looking for information to confirm their preconceived notion.

Any other examples you can think of?

(Source: Marginal Revolution)