Tag Archives: Domain Names

Starting An Online Business Will Be Easier If You Take Action In The Correct Way

If you prefer to listen/watch a video instead of reading then click here to go to my youtube channel.

The more thoughtfully you implement your ideas when starting your online business, the fewer actions you’ll need to undo or redo later.

It’s easy to get paralysed by fear or indecision or to be too perfectionist though. So, be ready to test your ideas, learn and try again, aiming for the happy medium between planning and doing.

Do put some thought into risk management and intellectual property protection though by being aware of the issues, examining them and then doing what’s feasible and desirable to reduce them so you’re not gambling with your future and take calculated risks.

You have to start to be great so do commit to starting your project, spending as little as possible in the testing phases.

 

Find your starting point

To reach our goals in life we need to be at the right starting point for the steps we’re about to take.

Where you start on the journey when setting up your online business impacts the actions you’ll take towards your desired end goals.  For example, if you haven’t yet worked out how to position yourself in the market you’ll need to do that first before spending money on branding and expensive designs.

Being mindful of where you are right now will help you to reach your end goal faster and more effectively because you can more properly plan how you will get there.

 

Niche

If you have chosen your niche and decided who you want to serve your starting point will be different from someone who has yet to identify what product to sell.

How to unpack your knowledge and skills, work out what to offer the market and who to serve is a large subject which I’ll cover elsewhere.

In this piece, I’m going to assume you’re ready to set up your online business and start selling.

Even then your starting point would differ from someone who has already tested their concept. Testing the market response to your ideas is so important.

Online businesses can be set up very inexpensively, so it’s easier to test your concepts first, and it’s extremely important to do so.

If you invest too soon in a name, branding, logo, designs and website development etc, and haven’t sorted out basics like what the market reaction to your offering might be, you may be wasting time and money.

As they say in Maine USA when you ask for directions “you can’t get there from here”, This is an observation of the impossibility of traveling a direct route between many places in that state. It has something to do with lakes and the organization of roads in the vast rural areas of the state.

Business is similar. It may be impossible to get to where you want to be from where you’re currently located.  The quickest route depends entirely on your starting point.

 

Structuring the business

When you’re at the proof of concept stage many of the decisions you will be taking will be temporary in nature.  Perhaps don’t use a name you’ve set your heart on yet, as everything involved with names adds to your expenses, and the aim during the testing phase is to spend as little as possible. However, it does depend on the business model of what you’re creating. For example, if you’re setting up a fashion label, the costs of branding, naming, trade marking, and design work are unavoidable in the testing phase.

Once you’ve tested your concept and have a viable business opportunity to pursue, the next step is to decide on the structure for your business and to create your brand.

 

Incorporate or not?

The first decision is whether to form a company and trade with limited liability or whether to operate as a sole trader.

It’s cheaper and less complex if you don’t incorporate.  You could simply trade using your chosen brand name and later, once your revenues justify it, set up a limited company.

If you’re not intending to use a company as your trading vehicle yet then there is no need to form a company to claim your desired name.  The way to claim rights over a name is through trade marks rather than company formation. So you would trade under your desired brand name, and then once you form a company later when you’re ready, you would still be able to continue trading under the same brand name. The name of the company does not have to exactly match your brand name.

On the other hand, if you do want to trade through a corporate entity (for example, to limit your liability even if your profits don’t justify the cost of incorporation) then it’s very cheap and quick to form a company using company formation sites online.  Note that your running costs will be higher than trading as a sole trader but that might be the price you’re willing to pay for limiting your liability.

For more information and advice about structuring your business, speak to a lawyer and accountant. Questions you will need to address are your tax position, and where to locate your business if your home base is in more than one country.  Online business gives you the freedom to work from anywhere so there may be advantages in locating your business in a particular jurisdiction. The position does depend on how long you will spend in each country.

 

Names and domain names

One of the earliest considerations for any business will be its trading (brand) name.

It is not widely known that it’s not possible to use whatever name you like. Just because a domain or company name is available to register does not mean it may be freely used for whatever type of business you like.

It’s necessary to identify a suitable name that

  1. Firstly, can function as a trade mark and
  2. Secondly, is legally available, meaning that someone else doesn’t have rights over it.

There is a lot to learn when it comes to naming so I recommend taking the time to focus on the Intellectual Property dimension as this is key not just to naming but to branding your business as a whole. IP is highly relevant for online businesses as there are many copyright and trade mark considerations to address.

One to one consultancy with a lawyer tends to be expensive and isn’t the best way to get the information you need on IP to create your digital product or set up your online business. Instead accessing Legally Branded Academy 2.0 gives you affordable, comprehensive information

This provides the advice any business needs whether at a startup stage or later as it grows and develops. There are essential templates to use included which ensures your online business is protected.

Branding is a large subject.  To come up with a brand proposition that’s compelling and unique involves working out your purpose, positioning, brand personality, values and more.  You’ll need to have a clear vision for your business and mission.

Do take time to think strategically about how you want to position your brand to get noticed. This might involve an ongoing process revisiting your ideas, particularly in the face of feedback from the market. So, if you’re thinking of engaging a designer or agency to “brand” your business and create your logo consider using some temporary designs initially until you’re very clear about your future direction. Possibly find a name you’re keen on and then get help from a branding agency.

There are a few other key areas you’ll need to focus on when setting up your online business, such as your website and contractual documentation which I’ll briefly touch on now.

 

Website and Documentation

Unless you’re getting a low-cost website with little functionality do take legal advice before engaging a web designer or developer. This is especially so if:

  • your website involves complexity
  • you are paying what represents a substantial sum of money for you.
  • You have strict timescales to meet.
  • You’re engaging web developers in distant locations sourcing them through platforms like Elance or People Per Hour.

To set yourself up for success make sure your formal agreement secures the necessary rights you need in the resulting website.

Buyer beware is the law’s approach. So, when it comes to websites and any other software development project the buyer has a lot more to lose than the seller if there is no written agreement in place.

As well as the basic contracts any online business needs, such as terms of business, website terms and privacy policies, there may be other contracts you need depending on your business model.

 

Conclusion

In conclusion, avoid doing things in the wrong order and your path to success will be much swifter.

Some people tend to waste time and money because they focus on branding and expensive designs and a website, before they’ve thoroughly thought through their product offerings and nailed their business model.

Setting up an online business is relatively straightforward and cheap to do.  You can have a basic website up and running for very little cost. That’s why it’s ideal to focus your money and energy on testing the market and properly thinking through your proposition.

Starting your venture on the right footing and developing your ideas correctly will enable you to get ahead far more quickly.

You should get Legally Branded Academy 2.0 or an equivalent way of understanding what you’re doing from an IP perspective from the very earliest stages because how to develop your concepts involves addressing intellectual property correctly from the outset of projects. That’s the way to ensure success and a valuable business.

Azrights IP One – Intellectual Property Made Easy

 

image_ipone_product_launch

There is no one size fits all when it comes to the actions you need to take to secure your IP. Protecting IP might involve doing some due diligence searches, registering rights, using appropriate documentation, and more. Your IP protection strategy will depend on your business plans, and overall objectives. For example, a business with a product like C-Pen will need patent advice, among other things. On the other hand, an author setting out to write a book, such as JK Rowling of Harry Potter fame,  What JK Rowling Needed to Know About Intellectual Property will need advice on copyright primarily. Both might want advice on trademarks too.

IPOne

So, we’ve introduced a new service: IPOne to offer SMEs the strategic IP advice they need regardless of their business or IP profile. The prices are fixed. We’re working on a tech version of this, which when launched, will give start ups on a shoe string budget access to the IP advice they need before they start up. This will be released later in 2017.

Why we created the IPOne service

We created the IPOne service because clients sometimes asked us for a comprehensive review of their IP position, and we had no specific service offering with clear deliverables to propose to them. Another reason we created the IPOne was that occasionally we noticed businesses that seemed to be focusing their IP expenditure on the wrong IP protection. For example, in one  case, an SME with a successful operation in the EU and USA, with no trademark protection in place at all, decided to  spend a considerable amount of money on filing a US patent for a business process that was unlikely to result in a strong patent, if it succeeded at all. With proper advice this business would have known to get some trademark protection, strategically maximising its budget.

Another reason we introduced the service was when we noticed how many SMEs were registering a trademark without first commissioning any searches, or  using IP without doing due diligence checks.

The problem

Invariably our most popular service is trademark registration. Trademarks have, to some extent, become a commoditized service due to the large number of service providers, many of them unqualified, who offer low cost trademark services. Businesses are even encouraged to believe  trademarks are simple enough for them to draft themselves.

As a law firm we were conscious of the risks clients faced in requesting a single service like trademark registration, when they had a host of other IP issues they were not even aware of. Yet the going rate for trademark registration was insufficient to allow scope for incidental advice on other IP rights.

Whenever it was clear that a client needed to take wider advice, we would highlight this to them. However, as the IP needs of businesses vary so much depending on the business model, IP advice doesn’t lend itself to being addressed in passing. It’s necessary to understand the client’s business model and aspirations in order to give relevant advice.

Intellectual Property also often involves a large element of education. So, it’s time consuming to communicate IP issues to SMEs, and advise on how they should structure their processes to be protected on an ongoing basis. The other problem we had is how to offer a price so clients would know in advance how much they would need to pay for holistic IP advice regardless of whether their business model would require a focus on patents, trademarks, designs, copyright, trade secrets, or database rights.  Giving an hourly rate and estimating the number of hours involved to advise isn’t straightforward to do when you don’t yet know enough about the client’s business model.

Who’s it for?

The IPOne service is for small businesses of fewer than 10 staff, be they pre-start up, early stage, or established. Every business that is aiming to build value or who simply wants to avoid some of the unpleasant consequences that can befall the unwary if they infringe on the rights of third parties, needs the IPOne.

When you have a good idea for a product or service, what you’re doing when you bring it to life is that you’re creating intellectual property. Virtually every decision you make in the early days of a project, from choosing a name, having a website or logo designed for you, writing content, creating a data plan, or taking some other creative action, has IP implications.

If you wait till you’re successful before taking IP advice it can be too late. IP needs to be taken account of early on if you want to avoid the need to undo ill considered actions later on. By then you might have already built something successful, and if its foundations are shaky it could have very serious consequences for you. So if you want to wait to address IP issues till your business has taken off, then consider whether it is possible to make all your decisions temporary ones? If not, it could be too late to leave IP advice till your concept is proven. Prevention really is ten times cheaper than a cure.

What’s different about the IPOne service?

The IPOne service is a fixed price service to give you holistic IP advice. It includes deliverables that SMEs invariably need, such as legal agreements, and a letter of advice, as well as a one to one consultation to ensure you take steps that are appropriate to your unique business requirements. A few key actions will set you up with strong foundations, giving you 80 per cent of the protection you need, short of registering your IP rights. All our IPOne services include advice on the steps to take in order to obtain this wide ranging IP protection on an ongoing basis.

What will clients get at the end of it?  

After you’ve had advice and holistic IP guidance your business can proceed to determine its strategy for securing its IP. Some SMEs may be better placed to obtain a legal monopoly, create new income streams or otherwise use IP to grow profit margins and protect their market share. You will be more able to protect the effort you put into building your business by knowing how to prevent competitors from copying you in damaging ways.

What Next?

The IPOne service responds to a market need for tailored IP advice giving a holistic view on the IP issues pertinent to any small business.

We want to change the way business protects its IP so SMEs are properly aware of the implications of their decisions when implementing their ideas, and know what to do on an ongoing basis to be protected.

Branding is IP

Branding – Why IP Is Intrinsic To The Work

Branding involves creBranding is IPating Intellectual Property (IP). Intangible assets produced during branding should be well chosen to ensure elements like names and logos are available to use and do not infringe on somebody else’s rights. A solid understanding of IP law can help ensure that the choices are also capable of creating potentially valuable intellectual property that is capable of protecting a company’s competitive market position.

Agencies need a way to incorporate IP considerations into their work. The practice of leaving IP considerations for clients themselves to deal with through their own lawyers’ due diligence on names leaves a lot to be desired.

Many clients lack an appreciation of the risks and opportunities that IP presents. The widespread belief that the legal aspects of branding can be passed on to clients therefore leaves them exposed. Many clients do not have access to lawyers with the appropriate skills to do searches during naming projects, or to give advice on copyright or designs.

Few have access to lawyers with the appropriate skills

Branding agencies are much better placed to provide the necessary legal checks. Any agency that creates intellectual property for clients play an important role in the client’s ultimate value as a business. So, they need to know about

  • Trademarks
  • Copyright
  • Designs

These IP laws are relevant to an agency’s own business, and also determine whether suitable IP is created for clients. For example, a good name is one that does not infringe on anyone else’s rights. Also, it must be the right type of name so it may be uniquely owned. Also, it is vital that steps are taken to protect the name before design work begins.

That is how you ensure the identities or other intangibles created, generate wealth and value for clients if their ventures succeed.

The importance of names

Names are potentially one of the most important IP assets a business uses. Key points are:

  1. Names should not infringe on the rights of others. So, legal due diligence before adopting a name is crucial. If someone else is using the same name it may be appropriate to abandon that name and find another.
  2. The adopted name must be capable of functioning as a trademark. Not all names are capable of being owned.
  3. The name should be ‘clear’ to use before trademarking. Trademarks are cancellable so doing due diligence is essential before registering a trademark.

Unfortunately, there is little real understanding of IP among SMEs, so agencies have an important role to play in educating their clients to help them to succeed with IP.

Inadequate training

However, designers own training rarely equips them with the knowledge to advise SMEs on IP issues. Few design courses cover intellectual property law, except in a cursory way. So designers tend to have to muddle through and learn about IP from hard experience.

If a design professional starts their working life in a large agency they are unlikely to be involved in every aspect of a project. So they are generally unaware of what goes on behind the scenes to clear names, and search logos. By the time they set up on their own, they have little insight into IP laws. A steep learning curve often lies ahead of them. The unlucky ones make serious IP mistakes along the road to wisdom.

Need for suitable IP help

So branding agencies need to find suitable IP help to better manage the complexity of IP laws given the central relevance of IP to the work of agencies.

The vast majority of branding agencies do their own checks during naming projects. However, they lack access to quality advice to interpret the results of their searches. Lack of guidance to interpret the results of searches can lead to perfectly suitable names being dropped.

It is not just when you’re finding a new name for a client that you need to do checks though. It is also important to verify whether a name that clients themselves have selected is suitable. In my book Intellectual Property Revolution which is a best seller on Amazon there are numerous case study examples of what happens when a business is stopped from using its name due to trademark infringement

Risk of leaving due diligence to clients’ own lawyers

The risk of leaving the legal checks to clients’ own lawyers – something many of them will not do – is that the name undergoes no legal clearance at all, and the client is left using a name which might cause problems for them several years down the line.

Alternatively, if the client does engage its own lawyers to do legal checks then the client might be disappointed if the name does not hold up to legal scrutiny. It also puts the agency in a difficult position as to where to draw the boundary unless it has clarified in advance what legal checks the name must withstand.

The fact is there are many different types of searches it is possible to do on names.

Names are just one type of IP issue that branding agencies need to know about.

We have solutions for agencies that want to address the legal issues in novel ways without incurring any overhead costs – something agencies generally associate with legal help.

We’d love to let you know about our innovative way of helping you with the legal aspects of your work, so please contact us or submit an enquiry referencing this blog.

What is Intellectual Property Part 2

What Oracle v Google Teaches Business Owners about IP Law

What is Intellectual Property Part 2The digital revolution is redefining businesses.  Companies that were once confined to marketing to a local audience now have the potential to operate international business from little more than a mobile set up.

However, the simplicity involved in starting up online can be a trap for the unwary says Shireen Smith, Intellectual Property (IP) law expert of London-based law firm Azrights.

One area that Shireen believes needs more legal attention is business concepts that require setting up a social media platform.

Social media platforms are experiencing exponential growth, with 72% of UK internet users now
having a social media profile in 2015 according to Ofcom research. And success can turn a penniless business into one valued at almost £300 million in a year, like that of US-based app YikYak.

“Firms may want to interface with other sites in order to access media.  This involves knowing about your legal position when using an Application Programming Interface, or API for short.  Put simply, an API is a language a programmer can use to talk to a system.”

“The law in this area is constantly evolving and with the web design and development industry being unregulated, it is crucial to seek legal advice.”

Oracle and Google have had an ongoing legal dispute concerning APIs since 2012, which Shireen discusses in her new book Intellectual Property Revolution published by Rethink Press.

“Google made use of Oracle’s API and the question concerned whether the API was protected by copyright.  If so, then Google was not free to make use of it without Oracle’s permission.

“The courts ruled that APIs are in fact protected by copyright in the US.  According to the US-based digital rights group, Electronic Frontier Foundation this gives tech firms ‘unprecedented and dangerous power’ over developers by making it substantially more difficult for upstarts to create new software.

Shireen Smith continues “Although it would be interesting to have a ruling from the EU on the same facts, given that most APIs that you might want to use are US-based, the US ruling is one that you would need to heed if you wanted to use an API.

“The upshot is that you may need permission from the owner of a platform if you want to create another system which is compatible with it, for example Facebook.  The legal protection of computer software is a complex and fast-paced area of law.”

With regards to other social media platforms, ‘tropicalisation’ is an occurrence that has been significant in China and Brazil.  The term refers to the practice of investing in start-ups which take an established business model and adapt it to an emerging market – a feat that is easily achievable in today’s digital economy.

“Examples include Peixe Urbano a Brazilian clone of ‘daily-deal’ site Groupon, Weibo  the Chinese Twitter-like microblogging platform, RenRen the Chinese version of Facebook, Baidu the Chinese take on Google and Alibaba a Chinese copy of eBay.”

“From an IP perspective there are few legal barriers to this tactic.  The law does not protect bare business models.  Elements of a business model might be protected.  A patent can sometimes
protect the technology, copyright can protect the expression of a concept, designs can protect the aesthetic aspects and trademarks protect business and product names.”

Shireen sums up by saying “Securing a range of intellectual property rights in different elements can combine to provide the most powerful protection as each IP right protects you in subtly different ways and situations.

A video which was especially commissioned for Azrights and can be found here explains further how the digital economy is changing IP.

‘Intellectual Property Revolution’ by Shireen Smith is available from Amazon and is priced at £12.99.  The book contains expert advice for businesses on how to successfully manage IP assets, protect brands and add value to businesses in the digital economy.  It is written in plain English and is intended for use by business owners and ‘brand guardians’.

Links:

Azrights website

Azrights on YouTube

Azrights on Twitter

 

What Karaoke Can Teach Us about Intellectual Property Law

Community Registered Designs and PatentsAccording to a Parliament briefing paper  published on Monday December 7, the number of businesses in the UK grew by 146,000 between 2014 and 2015 to 5.39 million, with 95% of firms employing fewer than ten people.

The emergence of the digital economy has allowed small businesses to market themselves to a global audience, removing a traditional barrier to entry in many industries.  However, if these small businesses don’t take steps to protect their intellectual property (IP) they can risk losing out.

Leading IP lawyer and founder of IP specialist law firm Azrights Shireen Smith believes small businesses can learn from the branding failures of large multinational corporations.

“Nowadays, SMEs are exposed to a global audience in ways that simply did not occur in the industrial era. We have more businesses today than we’ve ever had before, and because they can market to a global marketplace it is important for them to pick names which can help them to stand out, while not infringing on the rights of others.

“Given the possibility for a business with a good idea to create a substantial niche for itself, it is important that the name chosen is one that the business can uniquely own, ideally internationally. It should be a name which creates valuable IP – and that means it must be distinctive and capable of being trademarked.

“It is also important to understand some of the subtleties of IP law to appreciate why there does not need to be a dramatic consequence to ignoring IP, for there to nevertheless be a severe impact on a business which limits its potential. So, the owners may never be aware of the loss for the business.

“For example, you might find yourself like Daisuke Inoue, the Japanese businessman, who invented the karaoke machine. He hadn’t patented the invention, and others made significant sums of money from the invention while he made nothing. You would be aware if, like karaoke, you could have patented something, and would have some idea of what you lost.

“Alternatively, you could be like László József Bíró, a Hungarian born inventor, who in 1938 had patented the universally known ballpoint pen, or biro for short. Before the inventor had the chance to benefit from its huge commercial potential, László Bíró decided to sell the patent to Marcel Bic for $2million, around £11.6 million today. Bic soon used it as the main product of his Bic Company which is now reported to sell an estimated 15 million pens every day, and over 100 billion ballpoint pens globally. That is enough to draw a line to the moon and back more than 320,000 times, and to make £11.6 million look like short change.

“However, on the other hand, you may never know what you could have had exclusive right over, and hence earned more revenues from. What you don’t know you lost is not going to worry you. Although it should. Most people are in business to, among other things, make money. So, why wouldn’t you want to maximise your revenues by taking account of IP?”

Shireen Smith has recently launched a new book called ‘Intellectual Property Revolution’ published by Rethink Press which is all about how to successfully manage IP assets, protect brands and add value to your business in the digital economy. It is written in plain English and is helpful for business owners and ‘brand guardians’.

A video explaining more about how the digital economy is changing IP can be found here

 

Azrights website
Azrights on You Tube
Azrights on Twitter
Intellectual Property Revolution on Amazon

 

 

 

Naming your start-up: tips for lasting success

Naming your start-upThe notion that the main consideration when choosing a new brand name is its availability as a .com domain is widespread. What is less well known is that you may not be free to use your chosen domain name if the name would infringe on someone else’s trademark rights.

Countless start-ups regularly trip up because they do not realise they need a legal opinion to assess whether the name is free to use. So, there is no point paying substantial sums buying domains as one early stage business owner I met did a while ago. He had paid £10,000 for a .com domain only to be challenged by the owner of a similar trademark when he began using it for his new business. The disruption and financial consequences were an irritating distraction for him. It was completely avoidable. Had he consulted a trademark lawyer before choosing a name he could have avoided this set back. However, many business owners are reluctant to pay for a professional opinion, regarding this as an unnecessary expense. Ironically, this particular business owner, then went out and bought another domain name, again without having any checks, and only turned to us to register it for him. He was lucky that this time there were no problems with the name.

As this is a topic of interest to me, I was amazed when I came across a recent blog post from the CEO and co-founder of “Skilljar” which focused purely on whether the .com was available when choosing a name. In that case the business was changing its name, and surely this is one time when you really don’t want to get it wrong. The disruption of changing names 3 times would be so distracting and wasteful for the business.

Based on her experience of not being able to purchase the .com to the name she was using – Everpath – Sandi Lin decided to abandon use of the name, Everpath (even though her company held every other domain variation, including the important .net) and set off in search of a new name for which the .com domain would be available.

Using the crowdsourcing platform, Squadhelp, she searched for available domain names, and settled on the name “Skilljar”. She was convinced the crowdsourcing site would minimise the time involved searching for a new name. Based on over 800 submissions, she was inspired to pick a new name. Using ‘skill’ and ‘master’ as roots to search for names on Sedo, a domain name auction site, for ‘Buy now’ listings she then found several names that were available to buy within a maximum price limit of $5,000. She also checked for social network availability and searched Google for similar results. So it was that “Skilljar” was born.

What she omitted to do was to check whether the name Skilljar was too similar to a trademarked name in the USA and other parts of the world.

The correct way to choose a name is to do some Google research, check that the desired domain is available, and then get a legal opinion on the name. If the results are favourable, then register a domain as well as a trademark. Trademarks are the way to stake your claim to a name. Even though it is not necessary to register a name to use it, registration gives you far better rights over a name, and puts you in a stronger position if someone else starts using the same name (which they are more likely to do if you haven’t put them on notice of your rights over the name by registering it as a trademark).

So, while Lin is advocating crowdsourcing as a quick and relatively cheap approach which took her only 8 hours and cost the comparatively modest sum of $2,195, it is important that others looking to find a new name appreciate that this expense would be completely wasted if someone else had trademark rights over the name.

As a trademark lawyer I find her decision to rebrand questionable and surprising, particularly as at no point did Lin even consider the trademark implications of her proposed name. She was willing to forfeit all brand confidence to date, and choose a new name, and did not first think to check that the new name would be available for her to use.

Whilst arguably an inconvenience to have to first find out whether someone else has trademark rights over a name, start-ups are in danger of spending thousands of pounds more on enforced rebranding, and on domain names that they are not free to use.

So, don’t just focus on a brand name’s web-friendly characteristics. Avoid a lawsuit for trade mark infringement, and make sure you are using a name you can own.

Your Brand and Your Domain Name

Choosing names that say what your business does on the tin may not be the best approach to choosing domain names online, despite it being an approach many businesses have adopted in the past.

Often, it seems like a good idea to follow in the footsteps of those who have gone before, taking what looks like the tried and tested approach.

However, whilst in the past descriptive domain names may have given businesses certain advantages online, recent changes to Google’s algorithm at the end of 2012 have done away with many of these previous benefits.

The early days of the Internet

When the Internet was young, and not unlike a small village with just one toy shop, one grocery store, one pet store, and so on, descriptive names or phrases were popular for domain names. People searching for these pioneering online suppliers could readily find them by using descriptive keywords to search for them, and search engines made the websites easy to find.  In those early days if you wanted to find a business, chances are you would just type into your browser Books.com when looking for books or Hotels.com to find somewhere to stay and so on. Nowadays, less than 25% search in this way.

Google’s algorithm

As online business took off, and nearly every business put up a website, the online space became overcrowded.  A high ranking in search results grew to be the key objective of many businesses, as more and more of us turned to Google whenever we wanted to find a product or service, and so the practice of using descriptive domain names became entrenched because Google continued to give a preference to domain names describing what their potential customers were searching for. For example if you were called Jobs.com, you would be more likely to show up in the top results, assuming your website was otherwise well designed.

However, this led to marketers using “exact-match domain names” as a way to cheat the system, pushing low quality websites up in search result listings. With Google’s recent changes to its algorithm, Google has made it harder for sites to cut corners, ensuring that the focus is on quality and relevance. Today, Jobs.com does not even make the top 10 search results for a search for ‘Jobs’.

Brands over descriptive

Selecting descriptive names has never been good practice in branding, as these names do little to set you apart from competitors, but now with Google’s alterations to its algorithm, this method of choosing names is even more inappropriate.

Even before this algorithm change, the online environment that influenced people’s practices has been quietly moving on away from descriptive names, with users searching online being much more likely to opt to visit sites with recognised brand names. Rand Fishkin, a renowned online marketing expert and co-founder of SEOMoz, which helps websites get found online, summed up the point concisely in a recent blog post: ‘Unbranded sites may be losing significant amounts of traffic vs. their better-branded competition. Choosing a “keyword-match” domain seems like a worse decision than ever’.

We couldn’t agree more, and encourage readers to take care when choosing a domain name for products and services.  Choosing a distinctive name comes with a whole host of benefits, not least of which is the opportunity to own it through trade mark registration. It is also easier to deal with competitors who seek to copy your domain names. Do get in touch if this resonates with you, and you want to find out more about branding your business.

Google doing nicely from typosquatting

Google

Googol?

Harvard University researchers in a recent study, estimate that Google could be making $497million a year from the practice known as ‘typosquatting’ according to ZDNet

How does typosquatting work?

Typosquatters register domain names, usually a well-established trade mark, in bad faith to gain a commercial advantage. This usually involves holding the domains in a portfolio for web advertising revenue. The function of the domain is to attract traffic and generate click revenue.  The revenue is by way of a commission from Google or other search engines. Although the amounts per click may be quite low, for a high volume site the numbers soon mount up to large figures.

Pay Per Click advertising

The reason the revenue comes from Google or other search engine is that these will feature their advertisers’ Pay Per Click ads on the ‘content network’ (those of their advertisers that have not opted out of the content network distribution).  These include sites run by cybersquatters, who receive payment whenever someone clicks on the ads.

The way Pay Per Click works is that in order to get their ads listed high in Google’s or other search networks’ paid search results advertisers bid on keywords.  So, if the amount being paid per click for a keyword like “computer equipment” were $3.06, then Google or other search engine would keep the entire amount if the click on the advertiser’s ad came directly from the results displayed on its own pages.

But if the ad is sub-contracted out to others who are part of the wider content network, then these third party sites will display the ad too.  So if the click on the advertiser’s ad comes from a third party’s page or website then Google or whichever other search engine has the primary contract with the advertiser, would share the $3.06 with the click farmer, as they are sometimes called.

Click farming

The model specifically depends on the small number of surfers (15-20%) who type a url into a web browser rather than entering the name into a search engine. So, if a common mistyping of a brand’s url is entered into the browser, this “direct navigation” traffic (as opposed to indirect traffic through a search engine like Google) goes straight to the page at which the domain is “parked” (that is the place the domain address arrives at), or to its website if there is one developed, as there sometimes will be.  Then ads relevant to that brand will be displayed on the page in question.

Example of typosquatting

So, for example, if the typosquatter has registered ‘micresoft’ and  by accident when you are seeking information from Microsoft, you type into your web browser “micresoft.com”.  Instead of going to  Microsoft’s page you reach a website populated with related keywords – possibly selling computers or software. The domain owner, (sometimes referred to as a “click farmer”) would collect revenue each time you clicked on one of the featured ads, while Google or other search engine, would also take their cut from the advertisements.

The difficulties that have arisen between trade mark owners and registrants of certain domain names have been some of the main reasons giving cybersquatters a bad name, and it is interesting how online businesses such as Google are profiting from what is direct trade mark infringement by the cybersquatters.  Until the trade mark owner takes action to recover the domain name from the typosquatter, money is made from the ‘wrong’.  Also interesting is that while the typosquatter might receive a claim in damages from the trade mark owner, Google seems to get away scott free, although there were moves last year by litigants in the USA to claim against Google. Do any readers have more information about that?

Brands: Trade Marks and Domain Names Chapter 1 of Book: Why Web 2.0 Brand Protection Requires Online Brand Promotion

When I wrote the introduction to my proposed new book in early November Why Web 2.0 Brand Protection Requires Online Brand Promotion, I hoped to publish this chapter shortly afterwards.  Needless to say, life got in the way, and it is only now that I am ready, and even then only with part of chapter 1, called Brands: Trade Marks and Domain Names.  In future I will blog a chapter as and when it is ready rather than saying in advance when it will be ready….

I have received lots of positive comments about the proposed book, and a few tips.  The result is that I will publish some parts of the book via this blog, and other parts of it will only be available to those who purchase the book.

Please do help shape the book by leaving me your comments here on the blog or by emailing me if you prefer.

Secrets of Online Branding and Website Success

Web projects are riddled with Intellectual Property Rights issues.  These have a long term impact on the future of the business.  Awareness of online branding, search engines, copyright law and the technicalities involved in specifying a web presence are some of the key issues to consider.

An unregulated web means anyone can and does set up in business as an internet service provider offering websites, SEO or pay per click (PPC) advertising.  So SMEs sourcing internet services ought be more wary than when choosing a professional from a heavily regulated industry like the law or accountancy where there are in built safeguards protecting them as consumers (whether or not they are individuals or businesses).

For example, if you pay monies on account to a solicitor for work they are going to do for you, the Solicitors Regulation Authority and Professional Indemnity Insurance policies are there to safeguard your monies.  Even if your solicitor runs off with your money, you will get your money back.  But if you pay money in advance for a website, and the designer runs off with your money, you are unlikely to see it again.

Embarking on a Web Project?

Contrary to popular belief a web designer should not be your first port of call because they are not the most suited to helping you to assess your requirements and objectives for an online presence.  For example, sometimes a blog or stand alone E-commerce site might be the most appropriate solution.  A web designer would have a conflict of interest in suggesting this, or recommending an off the shelf or hosted E-commerce package entailing minimal design effort to implement.

While other disciplines also have inherent conflicts of interest, most professionals have too much at stake to let their self interest prevail over a client’s best interests.  But the web is completely unregulated, and there is no regulatory body overseeing web designers or other internet service providers.  So more than any other situation, it really is a case of ‘buyer beware’.  However, that is not to say there are not good web designers out there who would be act honourably and disregard their self interest.  It’s just that you need to take care when choosing service providers who are not subject to an independent regulator.

No matter how good your chosen web designer may be, it is inappropriate to look to them to act as your internet adviser.  This would be rather like relying on an interior designer to provide all the advice and services you need on a property matter when buying or renting a house or a shop.  It may sound ridiculous, but the lack of understanding of the web is such that this is precisely how much some businesses rely on a web designer.  Everyone knows when physical property is involved that you need to engage an estate agent, lawyer and surveyor at least, in addition to the interior designer, and that if you were thinking of significant improvements you may also need an architect too.  However, the various internet disciplines are not at all well understood.

For example, few appreciate the difference between a web designer and a web developer.   A common misconception is that web designers are the people with the best technical skills to produce a website. However, for all except the most basic brochure site, what is critical to success is a web developer’s technology and IT skills.  This is not only for ensuring the site has the necessary content management systems and associated databases, but that the development is properly managed and tested so that it can cope with the anticipated traffic.  Also the site must have the necessary backup and recovery procedures to cater for any system failures.  Unfortunately, not all web developers are properly skilled in IT either, so again it’s necessary to choose carefully.

Legal considerations

Leaving the registration of the website domain to a web designer is a mistake to be avoided at all costs.  Your rights to a domain name are based in contract, and therefore the contract should be between you and Nominet (for a co.uk name) and not between the web designer and Nominet.  Also web designers are unable to advise on the suitability of the name for branding purposes, and whether the chosen domain name may infringe someone’s trade mark.  This can be an extremely costly error to rectify.

When web projects go wrong the project budget will determine whether litigation is an option.  For many sites the costs of seeking legal redress will outweigh the benefits unless serious damage has been suffered, as where a client has spent a hundred thousand pounds promoting a site that does not then work when it goes live.

Using the small claims court is not an option businesses can realistically pursue given the complex technical issues websites often involve. So invariably the business will end up having to accept an inadequate site, or service – and this is particularly so if the domain name is registered in the web designer’s own name.

Workshop

Being one of the few firms specialising in online brand management, we saw a need for a workshop to guide businesses setting up or extending their online presence, and approached the British Library’s Business and IP Centre (BIPC).  Feeding into the Library’s existing support for business start-ups, a new workshop has been created to help aspiring entrepreneurs make informed decisions when engaging services for a web project or internet marketing campaign.

At the workshop Shireen Smith Solicitor will reveal the mistakes people commonly make when engaging internet service providers and outlines essential strategies for securing an effective online presence.  The focus is on the legal and business issues associated with Websites, E-Commerce and Online Branding.  The course costs £30 plus VAT and may be booked online here: Online Branding and Website Success .