Trademark, brand and building brand identity: Beware of legal risk
Written by Angga Priancha and Olive Nabila | Read in Indonesian
The term trademark and brand are often interchangeable in everyday discussion. It refers to a sign or name that is used by service providers to identify their products or services. Even though it is seen as similar, the terms contain a different meaning with different consequences both legally and conceptually.
The inability to differentiate the meaning of both terms might lead to a business risk, especially in terms of identity and trademark building. However, the misunderstanding of both concepts are still common to be found within industry practitioners. The misunderstanding usually comes from different perceptions from people in the marketing and advertising sectors with people from the legal sector.
The term brand is closer to being used by marketers in marketing their product. Meanwhile the term trademark is closer to the legal sector, especially in protecting intellectual property. Even though the implementation of both concepts will be complementary in creating a strong brand identity and valuable intellectual property in the form of trademark, the two terms should not be considered as equal.
This article will discuss deeper about the concept of trademark and brand with the objective to bridge the understanding between people with a legal mindset and people with a marketing and identity builder mindset.
First of all, what is a trademark?
Trademark is often known as something that is part of intellectual property rights regime. It is a regime of law that grants ownership upon human intellectual creation that has been fixated into a tangible medium.
Specifically, trademark law grants protection of trademark rights to the one who has created a trademark. Trademark rights give an exclusive right granted by the state to the trademark right holder. Exclusive rights means that the holder is allowed to prevent other parties from using the same trademark in the market. A right of monopoly.
So, what is a trademark? If we look at the definition from article 1(1) of the Indonesian Trademark Law, a trademark is a sign, a mark that is capable of distinguishing one product from another. The sign can be in the form of graphical works in the form of drawings, logos, names, words, letters, numerals, colour arrangement, in two- or three-dimensional shape, sounds, holograms or the combination of two or more of those elements.
Basically, it is something that we can use to differentiate and identify one product or another. Something that can accomodate to the original rationale on why we have the Trademark Law, which are market effectivity.
Trademarks are intended to make consumers easily and quickly distinguish the origin of the product, which is believed to lead to a faster transaction time. The easier consumer identifies a product, the faster they will decide what they want and make a transaction out of it. Especially when the trademark has a strong presence in the market, it would grant faster recognition from the consumer to identify the product, which is something that both trademark lawyers and marketers want; a product with a strong identity and easily recognisable in the market.
Trademarks, however, have a very narrow scope compared to brands. As it is a right given by the state and granted the power to monopoly on the usage or the registered mark, trademark must be registered in a limited concise scope. This is because a broad scope of monopoly will bring a negative impact to the market.
The limitation of a trademark is set when someone registering a trademark to the state intellectual property authority. Drafting a trademark registration is a tricky process because what you claim in the registration is what you get, as it is.
For example, someone who claims his trademark in a black and white logo will get the protection as the claim. He/she will only get the protection of his/her logo in a black and white colouring, while other colouring in any kind will not be considered protected as his/her trademark.
The failure in using the following claim will have the risk of trespassing other people's trademark rights that may lead to lawsuit and legal expense. Hence, trademark lawyers should draft trademark registration in a way that captures all qualities of the registered mark, be it the colours, shape, or spelling to a detailed level.
These limited traits of trademark rights might be seen as trouble from a marketer’s perspective. Marketers like to be flexible in building their brand identity. So, what is a brand? How is it different from a trademark?
Applying trademark into brand
Oxford Dictionary of Marketing defines brand as “A combination of attributes that gives a company, organisation, product, service concept, or even individual, a distinctive identity and value relative to its competitor, its advocates, its stakeholders, and its customers.” This combination of attributes can be in the form of names, logo, trademark and a relevant brand image in the eye and mind of the beholder.
The definition of brand hinted that both brand and trademark are working on a complementary basis as both are trying to make an advantageous distinction between a company’s products from its competitor. Brand, however, has a wider scope than trademark as it captures all aspects that build an identity of a company, products or services.
David Winarta, founder of Okular Studio, defines a brand as an impression, a bundle of impressions of products and services, such as visual identity, communication strategy, product marketing, up to its promises.
For an analogy, a trademark is the legitimate name of someone that is stated on her ID or birth certificate. He/she will be known officially by that name stated on his/her official document as it is. On the other hand, a brand is his/her traits not stated in his/her name that define his/her identity. It can be a different nickname, his/her values, or other things that people can see as his/her unique identity.
Similar to building a brand, David explained that there is a deep process in building a brand identity. “In the process of building a brand identity, especially in choosing a name and shaping the logo, we always conduct in-depth research to have a better understanding of the existing logos and brands.” Aside from studying the development in creating brand identity, David also stated that, “We research to avoid duplicating another brand.”
The relationship between brand and consumer is deemed by Oxford Dictionary of Marketing as an emotional one rather than rational one. It is dynamic interaction between the brand and the market that later turns into brand identity.
The development of a brand takes a different amount of time from one agency to another. As for David, he uses the “brand archetype” (a programme) aimed at investing characters into a brand to help him see how the brand represents itself to the audience.
The interaction tries to deliver brand values and vision on various topics, hoping that the brand values and vision would resonate with the target consumers, thus establishing a sustainable market for the brand. These dynamics and the process of building brand identity could create problems for trademarks rigidity.
Unlike trademarks that have a concrete limitation, brands have lenient and dynamic scope. For example, when building brand identity, marketers tend to follow the trend among consumers and try to interact with the “current popular thing.” It gradually changes to keep the brand relevant as the era and the trends go.
However, they might not be aware that they alter a registered trademark and might cause legal consequences. One of the most recent cases is Futura and The North Face. Naming a product could also pose legal threat if it’s a registered mark.
Another case for further reference is the 13-year-long feud between World Wildlife Funds and Word Wrestling Federation. Both were using the acronyms “WWF”. It started in 1989 when World Wildlife Funds claimed that World Wrestling Federation CEO Vince McMahon used the acronym “WWF” without their permission.
In 1994, both parties came to an agreement that World Wrestling Federation would stop using the acronym “WWF” on their live broadcasts. However, the company is allowed to use the term “World Wrestling Federation” on its logo and merchandise.
In 2001, the wrestling company violated the 1994 agreement by using the acronym “WWF” in their live show. As a result, it had to change its name and rebrand as World Wrestling Entertainment (WWE).
In order to avoid similar incidents, David explained, "While working on a branding project, having a legal consultant will certainly help." According to him, it would be better for a small to a mid-sized agency to outsource to meet legal needs.
Things that must be considered by marketers are regardless of how they are going to advertise the brand, which is usually identified by a trademark, they have to put into account the registered marks they have. They cannot modify the registered marks too far away from the trademark that they have registered. This is because the failure of following the corridor of the registered trademark could raise the issue of infringing other people's trademarks or making their brand not protected by using unregistered marks on their brand.
Even though they are similar and work complementarity in the market, both the terms trademark and brand have a different scope and meaning.
Trademark is the core for branding and brand identity. This is because regardless of the bright ideas of brand identity building, a brand cannot be protected or can even possess a legal risk when it does not stay under the corridors of the registered trademark.
