Tag Archives: Names

5 Crucial Points About Trademarks Everyone Should Consider

trademarkThere are 5 crucial points to know about trademarks that might change your entire approach to branding and trademark registration. I’ll start by answering the question what is a trademark.

 

 

What is a Trademark?

Trademarks are signs used in business to identify products and services in the market place.

Customers can find you by recognising your unique sign identifiers and avoid confusing other providers for you.  You might have a variety of identifiers – your name, logo, and tagline being the typical ones.

The single most common one people would recognise you by though, especially if they look for you online, is your name.

So, if you have delivered a good and effective service, and customers want to buy from you again or refer their friends and family to you, the unique identifier they would use to do so will be your name – often not your own personal name, but your business or brand name.

A trademark is a device or tool created by the law that enables consumers to find the products and services they’re interested in. It’s a container of your brand signs, such as your brand name.

Trademarks serve this purpose of being your “badge of origin”.  They’re designed to avoid customer confusion which is why a trademark has to be able to function as a unique identifier of your products and services.  A trademark therefore tends to be a most valuable asset as you build goodwill.

However, not all signs qualify for exclusive “ownership” as trademarks.

 

1. Names that Don’t Qualify As A Trademark

 Say you provide IT support services and call your business IT Support, you won’t be able to stop another IT support business also referring to themselves as IT support.

The law will not give anyone exclusive rights to use a term like IT Support which all other traders in the industry need to be able to freely use. If you use a sign like that which the law will not give you exclusive rights to, (for example, because the sign is too descriptive and not capable of functioning as a trademark), it means don’t have a unique identifier.  Effectively, it’s like not having a name.

Your competitors will be able to use the same sign or similar signs and steal some of your market share – they’ll get business that might have been looking for you. As such it’s like having a leaky colander rather than a leak-proof container for your brand. As such it means your brand value will be reduced, it will be less than it might otherwise have been.

Consumers will be confused when looking for your products and services.

Say you register IT Support with a logo. You will secure trademark registration, yes. However, what you’re essentially getting protection over is the logo, not the name. The law will not accept IT support as functioning as a trademark, so the name element won’t be exclusive to your business. Competitors would also be able to use IT support as a name to identify their business.

As the name is such an important identifier it is important to make sure any name you’re using with your logo is one that is capable of functioning as a trademark.  Otherwise, your trademark registration isn’t going to give you the unique rights over the name element of your trademark that you need. You will end up with customer confusion in the marketplace, and this will reduce your profitability as a business.

On the other hand, if you choose a good name that can uniquely belong to you, it will protect you even where someone is simply using a similar name that could be confused with yours by consumers.

A name that can’t function as a trademark won’t even protect you against use of exactly the same name by a competitor. Remember that buyers are not going to be so aware of the look of your logo if they’ve heard of your business from their friends and family as to be able to recognise from the logo on the website that it’s not your business but that of a competitor.

So, don’t be lulled into a false sense of security by a logo trade mark registration. Remember that the primary benefit of a trademark should be to enable you to challenge others who use similar names.

For an IT support business, a better choice of name would be Geek Squad.

However, there can only be one Geek Squad. If someone else is already using the name in the country in which you operate or has registered it as a trademark, you’d need to avoid choosing that name or indeed any name that’s similar to it. Otherwise you’d be infringing on the trade mark rights of the earlier mark.

From this it follows that once you have chosen a name, you MUST check that it’s available to use before adopting it.  So legal effectiveness and availability are keys to trademarks.

Domain and company names need to be checked before use too but it’s trademarks that govern rights in names. The fact that a domain name or company name is available to register doesn’t mean you can use the name for any purpose you like. You must only use the name for purposes which don’t conflict with third parties’ existing trademark rights.

This brings me to the next important aspect of trademarks you should be aware of, and that is trademark classes.

 

2. How Trademark Classifications Work. 

Trademarks are registered by reference to specific ‘classes’ or business categories. So you need to think through your plans, and identify the business categories that are relevant to your type of business, and then search and register your mark in those.

Under trademark law names may be shared.  So, if your desired name is already registered but for different business activities, you may still be able to use the mark, and co-exist with another business who is using the same name for those different purposes.

For example, Automobile Association and American Airlines are both known as AA; and are both registered trademarks.

Similarly, Polo is registered by three different businesses who use the name for a car, confectionery, and a line of clothing. Another example is Delta which is used both as a brand name for airlines, and for kitchenware and appliances. Dove is a brand of personal care products, but it is also a brand of chocolate

The take away from this is to identify the trademark classes applicable for your brand when searching, and drafting your trademark. The classifications determine the scope of protection you get.

You should seek the widest scope of protection necessary to avoid having someone else build up rights to use a brand sign in the business categories you need

Say you register your name to sell clothing, and then later decide to also sell cosmetics. If someone else is using a similar name to yours for cosmetics, you might infringe on their rights by extending your activities to encompass cosmetics, meaning you would need to find a different name for your cosmetics line.

Don’t ever assume you may go ahead and use your name for any business activity you like. First check whether you’ve registered the name for that business category – cosmetics, in this example, and if not, do a search and register in the new business category before embarking on the new use of your name.

 

3. Why Register a trademark

The third point to consider about trademarks is why bother registering.

Trademarks are an essential step to securing the exclusive rights your business needs over elements of your brand identity. It’s also the way to retain your brand’s distinctiveness, and to avoid seeing it become generic.

Registering a trademark is the formality you need to go through to secure ownership over your brand sign. As already mentioned, prioritise the name because it’s the primary way people will identify you.

A trademark enables you to stop others using the same mark. By having a registration in place, others are on notice of your rights.

Provided you’ve checked that you can use the name before you register it you get exclusive rights over the name in the business categories in which you register your mark.

It’s important to undertake proper searches because in some jurisdictions like the EU a registration doesn’t protect you against infringement. For example, Skydrive was a registered trademark of Microsoft but wasn’t enough to prevent them from infringing on Sky’s trademark rights. Sky took the matter to court arguing that the names were confusingly similar for cloud services and the court agreed with Sky. So, Microsoft was forced to rebrand to Onedrive.

Some countries such as Spain require names to be registered as the rights in names are based on who first registers a name rather than who uses it first.

In common law countries using a mark without registering it does give the user certain rights, but they are a lot more limited, and costly to enforce than most people realise. If you don’t register your trade mark, you risk losing uniqueness. Something that started out initially as distinctive to your brand can quickly become generic. Had Coca Cola not protected its iconic bottle right from the outset when the bottle was designed for the company, there is no way the bottle would today be uniquely associated with their brand.

A case that demonstrates how precarious it is to rely on mere use of a mark involved two bands that were both called Blue. BBC. One was a current boy band backed by EMI and the other was a 70s rock group known as Blue. That band had a single released in 1977 which got to number 18 in the charts, and had since released 16 singles, seven albums and several remixes. They hadn’t registered a trademark, and as a result, were unable to stop the new boy band using the name BLUE. The take away is to register a trademark. They’re relatively cheap to register, and very expensive to defend or enforce when you haven’t registered one.

The advantages of registering a trademark are significant. Registration considerably reduces the risk of others picking the same brand element for their new products or services because your registration is on the public trademark registers. People are expected to search these registers before choosing names or other brand elements. If you’re not on the register someone else may build rights over the same name or another brand element, and this can lead to messy disputes and unnecessary costs. If you are on the register they are automatically in the wrong for using the same name and it is, therefore, a lot cheaper for you to enforce your rights than if you hadn’t registered a trademark.

 

4. International trademarks- Strategy

The fourth point about trademarks is that they are territorial.

What this means is that you need to apply to register a trademark in every country in which you want to trade and receive protection.  There is no such thing as an international trademark.

There is an international mechanism in place to apply for trademarks which makes applying for trademarks in a number of countries simpler to achieve. It involves filing an application in your home country first and then thanks to various international agreements between countries worldwide you get 6 months’ protection from the date you first file your first application. If you then file an application under the Madrid system you’re able to extend your base home country trademark to countries who are party to the system. You simply file a single application and designate your desired countries and pay the applicable fees.

 

Unfortunately, if you don’t protect your mark in countries in which you trade, you could find yourself in a situation similar to what happened in Plenty of Fish/Plenty More Fish. Plenty of Fish, a well-established online dating site objected to PlentyMoreFish setting up a rival online dating site in the UK under a similar name.  They opposed PlentyMoreFish’s UK trademark application, arguing that PlentyMoreFish was riding off its reputation by setting up the rival dating site. They lost because they couldn’t show that they had UK customers and as they hadn’t protected their brand with an EU trademark they were powerless to stop PlentyMoreFish. That type of situation would never happen within a country as there would be passing off laws and other remedies under local trademark laws which Plenty of Fish could have used to stop PlentyMoreFIsh. However, online it’s possible for this sort of scenario to arise unless you are vigilant about protecting your mark in countries in which you trade. Best to cover off your home market and the important jurisdictions in which you trade.

Prioritise registering in countries in which you do business first. The fact that trademarks are territorial means your registration only protects you in the UK (or EU, if you’ve registered an EU mark).

A UK trademark registration covers the UK only while an EU trademark registration currently covers all 28 European Union countries in a single application, including the UK.  However, once the UK leaves the EU after Brexit kicks in, an EU trademark will no longer include the UK. So, you should be considering your strategy carefully if you’re registering your mark now.

It is possible to extend your home country registration to other countries that are not party to the Madrid Protocol by filing directly with an agent in that country. At the time of writing, important countries that are not party to the Madrid include Hong Kong, South Africa and Canada. You don’t need to be a household name, or a huge multinational to aspire to be a brand in the sense of becoming a recognised provider of the products and service you sell. Your brand protection is important.

 

5. Oppositions/Objections

Oppositions and objections to trademark applications do occur from time to time and that is the fifth and final point to know about trade marks.

The trade mark process involves a review by the trade mark examiners of the registry to which you apply for your trademark. They may have objections.

A typical objection might be that the trademark isn’t properly applied for or to inform you of search results. Many people who file their own trademark applications don’t understand the Examiner’s objections and tend to abandon their applications as a result.  If you’re filing your own application make sure you have a resource you can turn to for advice if there are objections to your application, as they’re often quite simple to address.

Once any objections are dealt with and your application is approved it is advertised for what is known as opposition purposes.  That’s when existing trademark owners will be alerted to applications that are similar to their registrations so that they can consider whether to oppose any.

Either the IP office notifies them or if they have trademark watch services, they hear from their trade mark agents. They may not necessarily bother to oppose applications. In the UK that doesn’t stop them objecting to a registration several years later. Indeed they often won’t oppose a start up and wait and see whether the start up succeeds before deciding to do so.

The single most valuable information that could literally save some businesses from catastrophic results is to learn from the mistake of Scrabulous.

This was a very successful app on Facebook that provided a Scrabble like game online. It had hundreds of thousands of users when it was stopped overnight almost by a trademark and copyright infringement claim. The business came to the attention of Hasbro, the owners of Scrabble because they filed their own trademark application and Hasbro was notified.

Hasbro considered that the company was infringing on its brand by using a similar name, and were also infringing copyright in the board game.  Hasbro applied to Facebook to have the app taken down. Facebook immediately complied. The company lost its successful business on Facebook virtually overnight.

The set back paved the way for Zynga to enter the market with what has become the market leader, Words With Friends. Scrabulous lost its position as first in the market.

The teaching point here is to get an opinion from a good trademark lawyer before filing an application as the application itself would alert others to your activities.

Had Scrabulous sought my advice, I would have counseled them to quietly rebrand rather than apply for a trademark which was bound to bring their infringement to a head.

You can rebrand to new names without any loss of goodwill because you are able to redirect everyone to your new name. However, when you are required to rebrand due to a trademark infringement claim you lose the value of the brand name recognition you have built up. You lose all the brand value you’d built up as the terms of infringement undertakings will not permit you to repoint traffic or tell people that you used to be called X name.

Much better for a business like Scrabulous to have quietly rebranded to a new name, and never come to the attention of Hasbro. They would still be the market leader today probably.

So, the moral of the tale is not to be cavalier about names or get too attached to a name that you may not legitimately lay claim to. It is not possible to choose whatever name you like. At some point, you need to get an opinion on the name you’re using.

A wider lesson from the above is that if you’re running a business where you don’t think a buyer of your business will want to use your name, that doesn’t mean you need not protect your name or need not to bother to make sure you are using a good name.

Your market share is what a trademark protects. If you’re forced to rebrand you can’t keep the value you had generated, and effectively “vanish” overnight. It’s like being back to square one with a totally new name and business. Nobody knows who you are.

Zumba: Anatomy Of A Successful Brand

Zumba is a dance fitness program that has taken the world by storm.

It has become many people’s favoured way of getting fit with as many as 14 million taking weekly Zumba classes, meaning that it has become one of the biggest branded fitness programs in the world.

However, Zumba does not stop at classes.  It runs instructor training courses, sells its own apparel, soundtracks, and merchandise, has its own Z-life magazine, and has even become a video game so that people can take part in its classes from the comfort of their own home (and without fear of judgemental eyes watching all those wrong moves!)

Zumba is much more than simply a fitness program- it has become a brand and a successful one at that.

The fascination with Zumba has become almost like a cult.  In a previous piece, I mentioned how desirable it is for a brand to attain cult status.

A lot of people get fanatical about it. For people who are looking for something in their lives, it offers a closeness, a sense of belonging, a family aspect that you don’t get in a gym’.

It has become something of a lifestyle brand that promotes Zumba’s vision of ‘health and happiness, and of loving everything you do, especially your workout’.

Rather than just fitness, Zumba sells this emotion and feeling of freedom with its powerful tagline ‘Ditch the workout, join the party’.

One thing I want to point out is the importance of the choice of name to Zumba’s success. The original name was Rumbacize, a combination of rumba (“to party” in Spanish, and a musical style and dance name), and Jazzercize. However, that name couldn’t work as I’m sure Zumba found out, so it changed to Zumba

A Lot of Zumba’s Success is Down to Choosing the Right Name

The name ‘Zumba’ has become synonymous with this emotion of freedom and that is why people looking for a dance class might choose a Zumba dance rather than the range of other dance classes available in the market.

It is also what attracts people to buy Zumba branded apparel, soundtracks, and other merchandise because people are buying into this feeling of freedom that is encapsulated by the Zumba name.

Although much of the business’ success has been down to the way it has created and developed its brand, and its success in really connecting to its audience on a level that no other fitness program has done, the choice of name also plays an integral part.

Its choice from a legal perspective has enabled the company to profit from its brand.

The name is also an extremely powerful choice from a branding point of view as well.

Not only is it distinctive, originating as a made-up word, but the actual sound of the name helps to reinforce the image of fun, energy, and freedom that the branding communicates.

Interbrand, discussing brand names from a linguistics point of view, points out that names starting with the letter Z often ‘evoke speed energy or precision’.  This is because the ‘z’ sound is quick and crisp.

Often people don’t realise that names can be highly evocative and the right name can stick in the mind of a customer. With its wide reach and a broad range of products, having a name that is catchy, memorable and well-suited, has been instrumental to Zumba’s success.

A lot can be learnt from Zumba about effective branding.

Not only does it demonstrate the power of creating a brand that goes beyond the product or service you provide- that really connects with your customers, but it also demonstrates how a name can be an effective tool within this branding process. The choice of name can lead to disasters for businesses, and a good choice of name is useless if the name is not capable of achieving a company’s vision.

The Name

Imagine if Zumba had stuck with its original name of Rumbacize or had opted for a less distinctive name.

People are often drawn to descriptive names that tell the world what kind of activity or product the business behind the name offers.  While a name like Rumbacize, if available as a trade mark, is distinctive rather than descriptive, and could potentially be registered as a trade mark, a name like ‘New Latin Dance’ would have been descriptive and incapable of functioning as a trade mark.  Not only is this a boring, impersonal name, but it is also legally ineffective as discussed here.

If you think about it, a descriptive name is the equivalent of not giving something a name. New Latin Dance does not sound as good as Rumbacize or  Zumba, but it’s not just about whether a name sounds good.  There are also powerful legal reasons why a descriptive name should be avoided.  The wrong name would limit a business’ development too. Rumbacize would have limited Zumba’s expansion plans.

Names matter because they are the way in which the law protects a business against various unfair competitive practices.  Specifically, the name is key in determining the extent to which you can control the use of a name.  The law does not give a business much control over who uses a descriptive name.  It’s free for everyone to use.

Therefore, names that describe the activity of the business, such as New Latin Dance, are not capable of functioning as a trademark.  The practical impact of this would be felt by a Zumba type business because it would be difficult, if not impossible, to stop others also using the name, and all sorts of different providers would have been able to call their classes by that name.

Suggestive names

But even if the founders had stuck to their original choice of Rumbacize, which is not descriptive, but is suggestive of the activity, and capable of being trademarked, they would still have found it difficult to control the use of the name.

While suggestive names can be an extremely good choices in some circumstances, they are unsuitable for some business situations.  For a Zumba style business which has ambitions to extend its reach internationally and to other areas of business activity, such as films, magazines, videos, clothing, and other merchandise, as Zumba has done, a distinctive made-up name is essential.

So, the question of how effective a given name would be for your plans depends on your plans.  The point I want to emphasise is that a name raises a number of legal issues, and should never be finalised without consulting a specialist brand lawyer.

Where a name leans too far in the direction of descriptiveness, bear in mind that even though you may secure a trademark over it, you may find it harder to enforce your rights.  You may have to spend a lot of time and money and even then would find it difficult to prevent others from using variations of your name.  That is why the EasyGroup spends far more money on litigation to try to control the use of their name than does Ryan Air.

Why does such control matter anyway?

Through having a name that is highly distinctive and trademarking it, Zumba is able to control who uses its name, meaning it can stop competitors offering similar products under similar names. It can license its programs so that those who want to provide Zumba classes may do so.

Zumba has become much more than just a dance program.  As mentioned, the choice of name has contributed to the company’s success giving it exclusive rights over the name in many different categories.  The company’s ability to trademark its unique name in a number of categories is the reason why it is able to generate additional revenue from the brand.

How seeking an early trademark contributed to Zumba’s success

Not only did Zumba choose the right kind of name, but if it had failed to register a trademark when the dance took off, the rapid success of the dance could have rendered its name generic, jeopardising the founders’ chances of registering a trademark.

For similar reasons, Microsoft nearly lost the chance to register its Windows name, having waited five years to file a trademark application, by which time it was considered ‘merely descriptive’ in relation to computer software, nearly destroying Window’s brand equity.

Microsoft eventually secured a registration, but would a new company have had the resources of Microsoft to pursue its case?

The significance of a trademark

Failure to appreciate the critical role of trade marks when choosing a name, and clearing it before registering the name as a trademark are essential ingredients to creating a brand.  If the name isn’t registered while you’re getting visual designs done then anyone could freely use the name in relation to their goods and services, meaning Zumba could not have used the name or stopped its use by others. The wrong name would have also reduced Zumba’s ability to expand. It would have remained a small scale short term business rather than the massive brand that it’s become today.

This demonstrates how the value of a brand is in its name.  From that, licensing and other opportunities flow.

Conclusion

If you don’t have a name that matches your business plans and don’t take the right actions to clear and protect it you’re leaving yourself vulnerable during any branding exercise.  The name is key to reaching your goals if they involve achieving a big scalable business so make sure you involve an experience brand lawyer at an early stage.

How to stay in control and avoid giving too much away during the pitch process

The Pitch Process – How Much Should You Reveal?

How to stay in control and avoid giving too much away during the pitch process

It can be difficult to know how much to reveal about your business during the pitch process. If you’re pitching in a public forum, should you risk giving your original ideas away? Is the exposure and possible investment funding worth the risks?

During the pitch process you are necessarily disclosing information about your business plans in order to impress a potential investor or client. The need to find the right balance between disclosure and secrecy is crucial for the protection of your intellectual property.

Seeking funding

In situations where a non-disclosure agreement (NDA) can be used, that might be a solution to the problem. However, in practice it’s unlikely that potential investors would be willing to sign NDAs. It’s more to your advantage that they hear what you have to say than it is to theirs to listen to you.

Statistically there are a lot more people looking for investment than there are investors. Moreover, while non-disclosure agreements (NDAs) protect you don’t take too much comfort from the mere signing of a confidentiality agreement.

Beware of others stealing your best ideas

If you have an idea which the other party could implement better than you – such as the situation that arose for the Winklevoss twins who shared their concept for Facebook with Mark Zuckerburg – then avoid going to them for investment if you have a potentially lucrative idea. Or if it is essential that you communicate the information to a third party without the benefit of an NDA in order to progress it, could you perhaps reveal the broad idea without going into too much detail?.

Another aspect that is worth considering is conducting a background search about the potential investor or client. Checking their reputation might provide useful ways to assess how much information is safe to reveal to them.

It’s important to be mindful of your business before divulging information. With some ideas you simply shouldn’t discuss them without an NDA if loss of confidentiality would lose you the opportunity to patent the concept. What if you have an idea for a product-based concept – such as Mandy Haberman’s Anywayup Cup? You would lose the opportunity to patent if you don’t use an NDA. Mandy Haberman could not have succeeded had she not patented the cup before going to market.

Patent pending applications

In practice, it is a mistake to go to an investor without having first applied for patent protection. Once you have a patent pending, you could proceed to raise funds. The costs associated with such first filing are not as high as you might assume.

The initial filing gives you 12 months’ protection worldwide, and an inventor who has intellectual property like a patent application, will be more attractive to a potential investor.

Names need protecting

Another issue to consider is protecting the name you want to use for new products and services you’ll be discussing while pitching in public. If you haven’t protected the name you are at risk. This is because names are not protected by copyright and a member of the audience could easily steal the idea, register the name as a trade mark and gain the benefit of all the publicity you generate.

Do take advice on names as there are many pitfalls for the unwary. If the name you are using is not legally effective, and suitable for your business, you might waste your resources in applying to register trade marks.

In conclusion, any ideas or names you have for a new business concept or product that you might want to divulge during a pitch are worth discussing with an IP lawyer before divulging them to others. Our IP Audit offering is the ideal way to access such advice. It includes a search, templates, and videos too.to help you protect the future value of your ideas, products and services.

Shireen will be discussing this topic on the panel at the 4th Drum Brief Encounters Conference on 20th of October. It’s at the Congress Centre in London. You can book at http://briefencountersthedrum.com./.

How to stay in control and avoid giving too much away during the pitch process

What is Intellectual Property Part 2

What is Intellectual Property? A Guide for Start Ups (Part 2 of 2)

What is Intellectual Property Part 2In this second blog post for ambitious start-ups during global entrepreneurship week, I focus on names, copyright and designs, as well as know how.

In the first blog post, What is Intellectual Property? A Guide for Start Ups (Part 1 of 2), I looked at patents and trade secrets.

There is much a well-informed start-up can do to protect its IP without spending a lot of money. The trick is having an IP strategy and knowing how to manage IP issues.

IP issues for names

As mentioned in an earlier blog, a start-up is not free to choose whatever name it likes. There are legal considerations to take into account. Finding a name that is available to use can be difficult due to the sheer volume of existing trademark registrations, and the fact that similar names are a problem.

For example, as discussed in our blog post, Facebook Users Mourning the Removal of Scrabulous, the name “Scrabulous” was too similar to “Scrabble”. As a result, the Scrabulous Facebook App which had attracted thousands of followers had to rebrand.

Trademark clearance checks are necessary to avoid infringing on the rights of others. While you can do some basic checks yourself, you need advice from a good trademark lawyer before you settle on a name. Names are an important way in which the law protects a business, so it is worth taking time to pick a good, legally effective one.

Once the name is picked, and checked – this might involve international searches if your business is going to be online – you need to register a trademark. You also need to be ready to extend that registration internationally.  Registration can be costly, so a business without a budget for IP would do well to delay choosing its ultimate brand name.

Disasters due to ill-advised name choices

Trademark disasters can befall any business, even multinationals such as Microsoft. Microsoft was forced to rename its cloud storage service SkyDrive to OneDrive following a trademark infringement dispute with BSkyB. Start-ups face similar problems all too often, they just don’t attract media attention. An important difference between start-ups and the Apples, Amazons, and Microsofts of this world is that start-ups lack the resources to get themselves out of trouble.

If a start-up has to rebrand for infringing on the rights of others it could sink altogether. As I explained in my blog post, Rebranding: Legal Issues you can’t afford to ignore, don’t shrug off the risks by assuming you will just rebrand if it comes to it. A rebrand involves changing everything at short notice and it will rarely be possible to divert customers from your old URL to the new one. Taking a risk over your name is a gamble – not a sensible business decision.

To avoid problems it is best to go with a temporary name initially. The time to focus on finding a permanent name is once the business concept is proven and there is a budget for IP checks, registrations and designs.

One strategy might be to start off using a descriptive name. As descriptive names cannot be registered as trademarks, you’re on safe ground using them. You can choose a distinctive brand name later, when resources allow. You can always keep your descriptive name at that stage by making it your tagline.

Businesses that need a budget for names from the outset

On the other hand, you may be starting a business where it is essential to build a brand. In a blog post a few years ago, I explained how Zumba’s success is due in part to its name. Zumba is a distinctive name that in no way describes its dance fitness business.

If yours is such a business – one that needs an effective brand name in order to succeed – then you would not be able to use a temporary name. You would need to find funds to consider trademarks before embarking on the business.

If Zumba had chosen its name but failed to register a trademark before the dance took off, its rapid success could have meant the founders were no longer able to register ‘Zumba’ as a trademark. This is a peculiarity of trademark law. Zumba’s wild success might have made the name generic and therefore incapable of registration.

It is generally advisable to register a trademark, as that is how you own the rights to a name. By registering their name, Zumba were able to capture the value that their success generated. Without it they would not have been able to exploit their brand for categories such as videos, clothing, books, and so on. And, the business would be worth only a fraction of what it is worth today.

So, if your success hangs on creating a brand, and licensing others to use your name, you won’t make it big unless you spend on international trademarks.

Copyright and designs

It may be that the key to protecting your business is not patents or trademarks, but copyright of a piece of software or other item.

According to research by the IPO, 40 per cent of business owners think they automatically own the copyright if they commission work which is capable of being protected by copyright.  This is the single biggest mistake businesses make. Paying someone to create work does not automatically make you the owner of the copyright in it.

So, it’s important to understand what types of material are protected by copyright. That way, you can secure the rights over anything that matters to your business.  For example, logos are protected by copyright. As the owner of a business, you need to ensure you own the copyright in your logo.

If you are using another company or a freelancer to develop your software (or other items that are protected by copyright) then make sure ownership in the work is transferred to you in writing. This should be done before you engage their services, for example in the contract you enter into with them. But this does not need to be done in a formal contract. It could be dealt with in an email. See my blog post: Why use a lawyer when you can buy a legal agreement? for further guidance.

If you have a design created for you such as a cartoon character, logo, surface designs, or an unusual shape, (such as the coca cola bottle) make sure you obtain the rights. But note that there is a limited time to register these as designs. There are official fees to pay when you register designs, so be clear whether the design in question is going to give you a competitive advantage or not. If you think it might, then try to find the money for design registration.

Know how

Finally, bear in mind that you may want to exploit any know how you develop. This will be discussed in a later blog post, Licensing and franchising: what is the difference and does it matter?

Say you are a car wash that has developed a successful process for getting its customers to buy for hot wax and other optional extras. You might decide to license this process to other car wash businesses in return for royalties. This involves a legal agreement whereby you license your know how and ensure the other party uses it under strict conditions of confidentiality.

Conclusion

If you are thinking big, you need to understand IP and how it applies to your business.  If you have the funds from the start, you can use IP to protect your competitive position straight away. If not, you can position your business so that you secure your IP once it grows and you have the resources in place.

For more information about trademark registration and protecting your brand, visit our dedicated trademark website www.azrightstrademarkregistration.co.uk.

Start up

It can be difficult when you start up to know how to spend your resources. Keeping a tight rein on expenses is essential in the early days, but it’s equally important not to neglect important issues like intellectual property (IP). IP is relevant in a number of different ways, one of these being the name you call your business.

StartupsThe brand name is the primary way in which consumers will identify your business, and is the ‘sign’ that customers use to distinguish your goods and services from those of competitors. Contrary to popular belief you are not free to choose whatever name you like, even if the name is one that is available to register as a domain or company. Your use of such registered names must still conform to trademark laws. Finding a name that is available to use for all your business purposes is not easy – especially if you trade internationally.

When starting up you may wonder what to deal with yourself, and what to outsource. What do you postpone and what do you deal with immediately? How do you go about creating a brand, and when should you invest in branding?

A brand is relevant to every size of business

Some business owners think brands are only relevant to the big household names. However, anyone who aspires to greatness should consider what a brand actually is and what’s involved in creating one.

A business becomes a brand once it is known for delivering on a specific promise. This attracts customers who positively want to do business with it rather than with the competition. The brand also attracts employees, suppliers and, ultimately, investors. So, your brand is what draws people to use your business instead of that of your competitors.

An important point to note is that the good associations customers have with a brand are, for the most part, transferred to its name. Just as individuals are identified by their name, so we identify a business primarily by its name.

Names involve legal complexity

A name is one of the first things you need when you start up in business. However, names involve a lot of legal complexity and potential costs. So it makes sense to have a strategy for the early days if you want to keep your expenses down.

Names are an important way in which the law protects a business, so it is worth taking time to settle on one, and to choose a legally effective name. This must involve a lawyer experienced in trademarks. The name is one of the most valuable IP assets your business generates if it is successful. The very choice impacts the value of the business. Pay proper attention to naming even if you think whoever eventually buys your business will not use the same branding.

Unless you already have a good understanding of your market and the gap you will fill in it, it could save precious resources at start up stage to avoid the expense of naming, design and branding. You will be much better placed to differentiate your business and brand it once you’ve been in business for a while.

Descriptive names

As a start up you might want to use a descriptive name to avoid the expense of trade mark searches and registration, and the risk of infringing on someone else’s rights.  A descriptive name informs the market of what your business does, and this can be useful in the early days when nobody knows you exist.

For example, if you will be providing digital marketing services, and call your business ‘digital marketing worldwide’ you would not need legal checks, expensive designs and more. You could get going and after you’ve been in business for a while choose a proper name. That’s the time to spend on branding. The name you pick must not be a description of your services, although you could always continue to use your descriptive name – ‘digital marketing worldwide’ in our example – as your tagline.

In the meantime, bear in mind how to what is involved to create a real brand.

Everything you do creates a brand

Every brand has its own distinct ‘identity’ and ‘promise’. It’s due to this promise that we know to expect something completely different if we buy a Rolex watch rather than a Swatch.

Everything you do, or don’t do, such as your marketing communications, employees, packaging, website, videos, photographs, premises and logo impacts the impression your brand makes. So you will need proper branding as soon as the business concept is proven.

Many other factors are also involved, including the products or services you sell, the way you respond to telephone enquiries and deal with your customers and the way customers are left feeling as a result of doing business with you.

Other things that contribute to the overall impression include:

  • whether you are a virtual business or based in an office
  • the way you engage on social media platforms
  • whether or not you blog – and if you do, what you write about
  • your writing style, newsletters and emails
  • your terms of the legal agreement with your customers.
  • your physical appearance and that of your staff.

The trust that your business gradually establishes in return for delivering a particular result or outcome is how your business becomes a brand.

You will be known for delivering a particular quality or outcome due to your reliability in the past. Customers will know what to expect if they use your product or service and there’s little risk of an unpleasant surprise. By contrast buying a product or service from a business that has not yet acquired brand status is risky, because it represents something untried and untested.

Conclusion

To get the clarity you need to brand your business takes time. Initially, work out what your unique value proposition is, and try to identify your core customers so you know why they are using your products or services. Then focus on satisfying their needs and get feedback on how they perceive the business.

When you are ready to pick a name, and brand your business be sure to include in your team a designer, a trademark lawyer, and a marketing expert.