5 Ways You Can Lose Money by Not Trademarking Your Brand
Trademarks can be considered a significant expense, especially for small businesses and start-ups. However, there is a good chance you could end up spending a lot more money if you don’t register them. Before we go any further, let’s just get clear on what a trademark is and why it is important.
A registered trademark legally protects your branding of the business name, goods and/or services it provides. It gives you the exclusive rights to use the trademark commercially, to license it, or to sell it to another party for the purpose of providing the goods and services it is registered under.
For example, with my business, I have trademarked the words “Seriously Trademarks” in Australia and New Zealand which mean that no-one else can legally provide consultancy services for trademarks under that branding in those countries. I own the words exclusively, so even if a third party can obtain a trading name with Seriously Trademark in its name, they could not promote themselves in any way to the marketplace with the name Seriously Trademarks® without me suing them for infringement.
Trademarks are visual or text representations of a brand.
These can include:
• letters • numbers
• words • phrases
• logos • pictures
• aspects of packaging • sounds
• smells • shapes
Because branding is how people can tell the difference between products and services that your business and other businesses offer, this makes registered trademarks a valuable Intellectual Property (IP) asset for any company operating and selling to the public.
If you have already started or are thinking of starting a business, the likelihood is that you already have some valuable IP in the form of a business name or products or services.
So, what are the costs involved with not registering your trademarks early?
1. If a copycat decides to steal your idea and register it before you do. You can still legally fend off the copycat by arguing the “First to Use” rule, but ultimately the cost here is that you will need to engage a trademark lawyer to go to court to keep your name. Along with that goes a whole pile of stress to add to your legal expenditure. Why would you bother to go down this track?
2. If your use of a brand name is challenged and you lose or decide not to fight, you will need to do a visual re-brand of the business, product or service. You will likely have business cards, a website, printed brochures, headed paper and other promotional materials which will need to be re-worked by a graphic designer and re-printed.
3. Lose control of your reputation. Imagine building up a business reputation in the marketplace and then having a competitor take on your name and on top of that offering inferior products and/or providing bad customer service that is damaging your company’s hard earned reputation. The loss of reputation will equate to lost of clients as they are dissatisfied.
4. If any of the above occur, you will be spending your valuable time working on implementing changes needed to ensure you are not infringing the registered trademark, e.g. liaising with service providers, liaising with clients, reviewing artworks, re-issuing employment contracts, re-sending promotional materials – and the list goes on. How much could the loss of your time cost your business?
5. Ultimately, the big cost in not registering your trademarks early is that you could lose your business as the cost of re-branding may be too much to bare. An Australian business A-sashi lost a legal battle with global giant Nestle over a product name and logo which looked similar. The case took over three years to reach a conclusion and has resulted in the Aussie business being shut down with its owner now unemployed and quoted saying he is receiving Centrelink payments.
Don’t let this happen to you and your business.
If you have any question, or need assistance with evaluating your brand name or protecting it by trademarking just leave me a message below.