The most famous dog in cartoons began as a bongo player named Too Much.
In the 1968 pitch described by animation historian Mark Evanier, Hanna-Barbera proposed a show called Mysteries Five. Five teenagers formed a band, and their dog, Too Much, played the bongos. Fred Silverman, CBS's head of daytime programming, disliked the title and had the show reworked as Who's S-S-Scared? Characters were merged and renamed, and the network bought a funnier version in which the dog was the star. It was renamed for him, and Scooby-Doo, Where Are You! premiered on September 13, 1969.
Silverman said the name came from a Frank Sinatra record. Wikipedia reports his account: the name came from the scat syllables in "Strangers in the Night." Cartoon Research says Silverman, Joe Ruby and Ken Spears long credited a Sinatra ad-lib heard on the way to a meeting. Mental Floss tells it with Sinatra playing on a late flight to Los Angeles, so the details of the story vary.
Mental Floss also notes that Sinatra actually sings a different syllable than "Scooby." Evanier goes further. He disputes the Sinatra story and says the name came from a 1963 doo-wop hit, "Denise" by Randy and the Rainbows. On his own blog he is more cautious, wondering whether Silverman is misremembering and suggesting that record may have been the source.
We found no second independent source for the "Denise" theory, and the Wikipedia page for that song does not mention it. Treat it as one informed historian's doubt, not settled fact.
There is also a trail of earlier near-matches. Wikipedia notes an unsold 1963 pilot with a character named Skooby-doo, and a 1968 Archies single with a similar name. The sound was clearly in the air. What nobody has documented is a deliberate meaning.
Wikipedia gives the dog's full name as Scoobert Doo, so Scooby is a short form. Beyond the song story, no source says why the sound was thought right for a cowardly Great Dane.