A trade mark is a unique name, logo, slogan or a combination of them that acts as a badge of origin for your goods or services. It also distinguishes your brand from competitors in the market. For this reason, a distinctive trade mark provides your business with an additional competitive edge. Therefore, investing in registering a trade mark for your business means taking a positive step in protecting your greatest asset: your intellectual property (IP). This article sets out why a trade mark is important for your business.
A Unique Identifier of Your Brand
Whether it’s a name, logo, or slogan, a strong trade mark distinguishes your business from your competitors. For instance, when you’re driving on the motorway and see the golden arches sign, you know that you’ll make a stop at McDonald's and not any other food outlet. This is because the logo is distinctive.
An Important Communication Tool
A trade mark can serve as an important tool to communicate your brand’s mission and values. When you see the golden arches, you think about the Big Mac, fries and McNuggets. You also know that you’re not going to have to wait long for it and are not worried about spending too much money for a meal. You associate the brand with affordable fast-food and this is exactly what McDonald’s is trying to achieve. A trade mark is an efficient communication tool and can be an image that is universally understood.
- A Valuable Business Asset
An established trade mark can be a valuable asset for your business in the long term. Take online marketplaces like Uber and Airbnb as an example. The value of the business relies on its reputation and brand recognition. Over time, the trust in and goodwill of the brand can increase your business’ overall value. Like any other business asset, a trade mark can also be used as security to obtain a loan to invest in the future development of your business.
Build Loyalty Towards Your Brand
Having a unique trade mark can help you build loyalty towards your brand. Your brand can be defined as everything you do whether it’s:
- your product or service;
- how you treat your customers; or
- how you make your customers feel.
Customers are often unwilling to switch brands once they are comfortable and trust the quality of the products or services they are purchasing. A unique trade mark not only distinguishes you from your competitors, but also allows a customer to associate their satisfaction with your trade mark. If you build up brand loyalty, it is also much easier to tap into new market segments or industries.
Brand loyalty applies not just to customers, but to anyone who comes into contact with your business. For example, hiring and retaining employees who are loyal to your brand can result in higher employee satisfaction and productivity. And ultimately, since your employees will be dealing directly with your customers, ensuring they are loyal and motivated will impact the customer experience.
Exclusive Rights if You Register
Finally, a trade mark can either be registered or unregistered. Registering your trade mark grants you the exclusive right to use it in relation to your goods or services. If you have registered your trade mark, you can claim trade mark infringement against anyone who uses your trade mark, or one very similar to it, without your permission.
It can be more difficult to enforce an unregistered trade mark as you are relying on being able to prove passing off or misleading and deceptive conduct, which can be difficult to enforce.
Only a trade mark that you have registered with IP Australia can use the ® symbol. IP Australia will register your trade mark if it is:
- unique and distinctive;
- not generic or descriptive of your products or services; and
- not confusingly similar to another registered trade mark.
- Make Money Off of Your Registered Trade Mark
Having a registered trade mark also allows you to commercialise the brand you’ve built. You can license your rights to a third party in exchange for payment. This can help increase your brand awareness.
Additionally, you can assign your rights to your trade mark for payment. This effectively means you are selling the trade mark by transferring the ownership to another party. You cannot continue to use the mark yourself if you assign it.
Trade marks are a valuable asset for your business. A unique trade mark sets your brand apart in a competitive industry. Your trade mark should represent your brand’s mission and values and be easy for people to recognise and understand. Over time, a strong trade mark can increase your business’ value and brand. Therefore, registering your trade mark with IP Australia is an important step to take to gain an exclusive right to use the mark and protect your business against copycats.