What You Should Be Working On Right Now, Part III
Be confident while investing in building your brand by getting a trademark.
This post is the third in a five-part series on what you—the entrepreneur—should be working on right now. (Read Part I, Part II). The basic premise of the series is straightforward: You should be increasing the value of your company by treating the company as a product that you want someone to buy.
A potential buyer of your company would likely want it to be easily recognizable and stand out from its competition, command a “presence” in the marketplace, and be known for the value of its products and services. These are characteristics that should appeal to you too! These characteristics define “branding,” and come from your prior investment in marketing your brand. But what if your “brand” was not your own? What if anyone who saw your success was able to use your good name, to ride your coattails, to compete directly with you by being a copycat? Trademark law makes that a losing proposition for the copycat.
What Is A Trademark?
A Trademark is any “mark” that allows consumers to easily distinguish the maker of one set of goods or services from those of another maker. A trademark can be a word, phrase, symbol, color, sound, design or other device that consumers can rely on to identify the source of certain goods or services.
Trademarks protect not only the company that owns them, but they also protect consumers who want to know exactly who made the products they are about to buy. Two popularly known trademarks are the name “Apple” and the iconic image of an apple with a bite out of it. But note that the same name can be used by two companies that are in an entirely different markets, so for example there can be an Apple that is
reserved for use with the market for computers as well as an Apple that is reserved for use with travel agency services.
Trademark is a type of property known as Intellectual Property because it starts out as an idea before it is converted into property. And like all kinds of property, the rights of a trademark owner are defined by law. If you register a trademark for a word, phrase, symbol, design or other device in connection with a specific market, you get the exclusive right to use that mark with goods or services in that market and in the jurisdiction where your have registered it. If you register nationally, at the US Patent and Trademark Office, that exclusive right to use extends nationally, and you may attach the famous ® symbol whenever you use your mark. Another advantage to registering a trademark is that the law grants quite favorable remedies to owners of registered trademarks that have been infringed, including legal fees in a civil action to protect your registered mark and hefty damage payments by the infringer, so prospective infringers beware!
Use of the ® puts everyone on notice that you have a registered trademark and you are willing to defend it in the federal courts. But it’s against the law to merely attached the ® to your mark without registering it first, so don’t take that path.
Your trademark attorney can do the work to file your trademark application for you, or you can learn how to do it yourself with the tutorials at www.uspto.gov/trademark.
What You Should Be Working On
Trademark is the legal side of “branding.” When you takes the steps to register the name of your company or one of its products or your logo, you can comfortably invest in building public recognition of your brand.
One of the outcomes of having a recognizable brand is that you can monetize the use of that brand. For example, the basis of franchising is a license to use a trademark. The franchisor owns the trademark and takes royalty payments in return for allowing franchisees to use the trademark. The franchisor continues to build the value of the trademark by investing in marketing and by controlling the quality of the goods or services associated with the trademark.
Many entrepreneurs make the mistake of being the face of their company, to the point of diminishing the company’s independence. Essentially, the “brand” becomes the person at the head of the company, not the company itself. This is especially a problem for service companies. In effect the entrepreneur is associated with the company’s services more than the company itself is.
Even if you do not intend to become a franchisor, you can increase the value of your company by protecting and promoting the company as a brand that is distinct from you as the owner. When you promote the company as a brand, you give potential buyers of your company the warm feeling that the company has an identity beyond its owner.
You may register a trademark on your own name, but only if it is used in connection with a good or service. I counsel most of my clients to use a separate brand for the company and its products.
That is not to say you should not brand yourself! By all means, entrepreneurs should brand themselves. But you should make yourself known for a personal trait, not for your company’s products. So you could be the “Intellectual Entrepreneur” if you have a lot of college degrees, or the “Management Mogul” if you have a knack for managing people and resources. Think of a market for personal traits and skills that is distinct from the market for the goods and services supplied by your company. To protect your personal name you probably would not use trademark law, rather you would likely rely on a different body of law called tort, specifically right of publicity and misappropriation of identity.
The Interplay Between Your Brand And Your Trade Secrets
In the previous post in this Series I discussed trade secrets. You can intertwine the image of your company and your trade secrets to obtain a marketing advantage. Highlight the fact that you have a “secret sauce” that no one else knows about, and it makes your company delivery better quality, cheaper service, more secure dealing, higher reliability, or whatever else your secret method offers. At least part of the mystic Coca Cola has generated in their marketing is that they have maintained the Coke® recipe secret for so long. Of course the other beverage companies can argue the same thing. That link between brand name and trade secrecy cannot be the subject of a trademark, because trademarks protect only the link of the name with goods and services used in commerce. But Coca Cola has been so successful at creating this image that their trademark is synonymous with a secret recipe, if others tried it they would be viewed negatively, or worse, they would be effective only in promoting Coca Cola!
Your Next Steps
Look around your company for processes, products, names, taglines and images that you can use to generate a public perception of the company. Incorporate your mission, values, and anything else that might make you stand out from your competitors. Then name the processes and products, refine the names, taglines and images, and secure trademarks on each of them. Once you have you converted these ideas and concepts into protected the intellectual property of trademark, you can invest confidently in your brand. And watch the value of your company grow.
Argent Place Law, PLLC serves businesses and business owners in matters of business and contract law, intellectual property law, and succession planning, including estate planning with wills and trusts. By integrating these fields of law, Argent Place Law is the law firm For The Life Of Business.TM