Are You Risking Your Brand Equity?
March 16, 2016
When people start a business, they tend to focus on their business objectives and goals: the products, services, relationships, as well as administrative and other internal business structures required to make their business efficient. After a while, the business name becomes connected with a certain type of product or service. That connection is trademark identification and the value builds with the goodwill and brand equity that are the embodiment of your hard work, time, and other investment.
Business owners purchase their marketing ad campaigns, business cards, word of mouth, even Google Adwords-using their business name. Unfortunately, people don’t often think of their business name or even the names of their products or services as a valuable place to allocate resources. But, as noted, simply by using a name, a business owner is investing resources in a name.
Often, a business name is chosen that is either too descriptive or already being used. This leads to the business owner being forced to assume a new name, which, aside from money, takes a considerable amount of work, such as:
Filing the necessary documents to change the names of regulated financial instruments;
Investing in all-new marketing materials;
Spreading the word that the same, trusted product will be available under a new name; and
Portraying the change as a positive step for the business.
Two business partners contacted our firm to search a business name. Just by looking at the name, we knew it was not a good choice, but our clients wanted us to secure it anyway. After searching the mark, we advised them that going after their chosen name was a bad idea and we offered to search other names as a courtesy. Unfortunately, they chose not to heed our advice and secured the name themselves, as well as a USPTO registration.
Three months later, they faced an impending federal lawsuit seeking $30,000 and other fees in exchange for not filing a trademark infringement lawsuit. Our clients came back to us and we were able to negotiate and take tactical steps to protect their rights, but it ended up costing them a good deal of money for a legal budget that they really did not have to spend, had they chosen their name wisely in the first place.
Doing a clearance search, then filing and securing trademark protection on a name or a logo, can protect against the time and expense of a name change. There are no guarantees, but taking these steps generally will serve to protect your brand equity.
Without even doing a clearance search, a conversation with us can tell you whether or not your business name is particularly difficult to protect. The next steps may include a search and, depending on the search results, seeking trademark registration protection.
When it comes to your business, a thousand dollars today can save you ten thousand dollars tomorrow. Contact us to discuss your new business name.