Charlotte Henley walks you through the basics of brand protection when entering overseas markets.
If you have a successful brand in New Zealand and want to use and market it overseas, there are a number of potential pitfalls to be aware of. Most of these can be avoided with care and planning.
There are some basic things you should do before exporting your brand: conduct a trade mark clearance search, consider any local translation issues, and file trade mark applications.
You might also elect to licence your trade mark rights to a third party for financial return.
There is a possibility that someone else may already own ‘your’ brand overseas. When Burger King moved into the Australian market a number of years ago they found a smaller entity already owned the trade mark Burger King, and as a result they had to re-brand their restaurants as Hungry Jacks.
Before you move into a new market, you should ensure no other entity has prior rights to your brand (or any confusingly similar brand) in that market. If you do not, you could end up in an expensive dispute over who has the right to use the brand.
If another entity already owns the same or a similar brand in any of your overseas markets, you may need to consider a new brand name, and consequently a new marketing strategy if you want your brands to be consistent across all your markets. This is often the case with packaged goods.
It is also important to consider not only the exact goods or services you are selling under your brand, but any similar goods or services. Apple Computers was sued in 1978 for trade mark infringement by Apple Corps (which is the owner of the Beatles’ founded record company Apple Records). While computers and music records may not immediately appear to be similar goods, the parties did end up in a dispute which was only settled out of Court years later for a substantial amount.
It is possible to conduct brand clearance searches in most, if not all, countries prior to use and this is highly recommended. However the timing is important. While it is optimal to conduct the clearance search close to when you will be entering the new market, conducting a search late in the process – when all your marketing collateral and signage has been finalised and printed – can be problematic. It can be very costly to re-brand (and replace your collateral and signage) if you find out that someone else does in fact already own your brand name in that market. Instead, clearance searches should be conducted at the time you are considering moving your brand into a new market or when you are selecting a new brand to use across a number of markets.
How will you protect your brand?
Once you have conducted your clearance searches, it is worth considering how you will protect your branding. The best option is to seek registered trade mark protection.
New Zealand registered trade marks do not provide you with protection overseas. Trade mark protection will therefore be needed in each country in which you want to use your brands. You cannot generally enforce trade marks until they are registered, which can take months or years from their filing date, so this must be an early consideration in your strategy.
While it is possible to make use of the Madrid Protocol to coordinate the filings of your various overseas applications, it is not possible to simply file one international application to automatically give you protection in all countries. Also, unless you are seeking protection in a large number of countries it is not necessarily cost efficient to file a Madrid application.
If you wait to file any trade mark application until you have determined if you will be successful with your products in the new market, there can be risks. For example, a third party may attempt to register your brand name themselves. In some countries (including China) the first person to file a trade mark application is taken to be the owner – in other countries it is the first person to use the mark. In either case, it can be expensive and time consuming to fight over your trade mark.
Translating (or mis-translating) your brand
When Kentucky Fried Chicken (KFC) originally moved into the Chinese market in the early 1990s, its “finger-lickin' good” slogan was mis-translated into Chinese characters that meant “eat your fingers off”.
It is worthwhile obtaining the advice of a local translator/marketing expert to assist with an appropriate translation of your brand name. Plugging your name straight into Google translate can have unintended consequences. Even close markets such as Australia can use a different dialect. For example, a “thong” is either footwear or underwear depending on which side of the Tasman Sea you’re on!
A joint initiative between Russia's Gazprom and Nigeria's state-operated NNPC was originally called Nigaz, which prompted outrage.
Unintended meanings for your brands can have a negative impact on your goods and services. Conducting a major launch with a name that has a negative or unintended association can also mean you lose potential sales and goodwill in the market and it may be costly to have to re-brand. Most clearance searches should consider the meaning of your mark and if this has any adverse connotations.
Licensing your rights
If you do enter into any licence arrangements regarding your brands you should ensure you have considered the reputation of the entity you will be working with and that you have a strong licence agreement in place. This is to ensure you have control of the quality of goods or services being manufactured or supplied under your brand, and the ability to exit the arrangement if it all turns sour. You should also ensure ownership of your branding (and any changes to your branding) is clear in this agreement.
Remember, when exporting overseas, your brand is your reputation. There are things you can, and should, do to ensure success offshore. Ignoring the basics can be very costly indeed.
Charlotte Henley is a partner at Kensington Swan specialising in intellectual property. Ema O’Brien, an associate, assisted with this article. www.kensingtonswan.com