A recent local news story has served to highlight the importance a name has in brand strategy. Nationwide gym chain "The Gym" is shortly to open in Gloucester in direct competition with local Gloucester fitness centre "The Gym". Confused? If you are, you are almost certainly not alone.
The owner of the local "The Gym" has raised concerns that the soon to be opened nationwide chain of the same name will result in confusion amongst both existing and potential members with the result that he will lose business. This is compounded by the fact that the nationwide "The Gym" will have greater marketing resources enabling it to raise awareness of its brand, over and above that of local "The Gym".
In its purest form a company name (i.e. its brand) is a means of differentiating the goods and services offered by one trader from another. The more distinctive the brand, the less chance there is of it being confused with another brand selling similar goods or services with the long term gain being increased custom and profit.
In the present case the problems started when (and both parties are guilty of this) the brand name "The Gym" was chosen. "The Gym" is wholly descriptive of the services being provided by the trader and is generic to the point of being unidentifiable. It is easy to appreciate the thinking behind the naming of the gyms; it is a common turn of phrase to say "I am going to the gym" and "The Gym" branding is an attempt to play on this turn of phrase. Unfortunately, this turn of phrase leads to one question: "Which gym?" Cue confusion.
If it makes the owners of the respective "The Gyms’" feel better, they are not the first, and will not be the last, to make such an error. Ford released the Ka (pronounced car) in a clever attempt to make a play on the fact that the Ka was a car. Whilst the Ka brand remains in existence, the consumer market as a whole generally refers to it as the K A (pronounced Kay Ey) as to do otherwise results in the inevitable, and pretty funny, confused conversation about what car you own.
As a brand is the key asset of any business it is of crucial importance to think long and hard about what your company name will be. We would always advise running any ideas past family, friends and professional advisers to gauge whether or not the brand is suitable for your business. Had the owners of "The Gyms’" sought this advice in advance of launch then it is likely they would have avoided the situation they are in now. However, on the plus side, this event has generated publicity for the local "The Gym", which can only be a good thing!
These notes have been prepared for the purpose of an article only. They should not be regarded as a substitute for taking legal advice.