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The number of trademarks owned by corporate entities is increasing but the cash to defend their expanding portfolios is not. Elisa Cooper, vice president of marketing for Lecorpio, has some suggestions for protection on a budget.
Companies invest enormous sums to establish, maintain and protect trademarks and brands. Trademarks are valuable assets, but they can become targets for infringement and abuse if they are not sufficiently protected.
Research detailed below shows that while trademark registrations are growing fast, the spending on support services to watch and police them is not keeping pace. If this becomes a recurring trend, companies fitting this description are heading into perilous territory by investing resources in trademark establishment, but then skimping on their monitoring and protection.
Lecorpio IP management and analytics company has conducted its first “Trademark Management Study”, which was designed to benchmark trademark growth and spending among corporate law departments. The study, published on May 18, found that 55% of respondents said their trademark portfolios had increased since the previous year and that for 45% of respondents trademark registration budgets had gone up.
Given this substantial growth in portfolio size and registration budgets, one would assume that spending for services such as watching and policing would have also increased. This was not the case. In fact, only 27% of respondents said watching/clearance budgets had increased, and only 18% of policing budgets had increased. For both watching and policing, the majority of respondents said that their spending had stayed the same. The bottom line is that the number of trademarks is increasing for corporate entities while budget to protect their expanding portfolios is not.
Providing further evidence of scarce resources to manage trademarks, 91% of respondents reported no change in the size of their internal team responsible for managing trademark portfolios and 9% actually reported a decrease in team size. Given that trademark activity is increasing, it seems that headcount is staying the same or even diminishing for some departments. This is truly an example of in-house IP counsel’s ongoing challenge to ‘do more with less’.
So if trademark portfolios and registration budgets are increasing, but budgets for watching and policing are static and manpower is stagnant or dropping, how can companies protect their trademarks and brand equity adequately with lean resources? An effective strategy is to establish flexible, selective and economical watching and policing approaches which provide maximum benefit while requiring fewer resources.
“An effective strategy is to establish flexible, selective and economical watching and policing approaches which provide maximum benefit while requiring fewer resources.”
Consider these strategies to help trademark counsel protect brands effectively with lean resources:
Prioritise protection based on value
Companies must prioritise which brands to protect and to what extent. These decisions can be based on valuation criteria such as revenue, geographic coverage, traffic, type of infringement, potential for damage and effect on customers.
Ask vendors for flexible contracts
Watching and policing vendors can be helpful allies for trademark counsel, especially if they are willing to develop protection programmes tailored to provide maximum benefit for the client company. For example, if a brand protection vendor contract covers five brands, the client should be able to periodically swap out or recalibrate which brands the programme covers, in keeping with its marketing campaigns and seasonal activities.
For example, certain brands may be more vulnerable during the summer, while others may be infringed more frequently around the winter holidays, so if there is no overlap, one could replace the other in the monitoring contract at a certain point in the year.
More money please
These two strategies are bound to help trademark counsel make the most of their budgets, but if approved trademark services spending has already been thoroughly leveraged and exhausted and there are no other alternatives, corporate trademark counsel can make a case for additional funding to protect the company’s trademarks.
Douglas Isenberg of GigaLaw Firm emphasises the importance of protection and the vital need for funds to support it, especially since online activity has made infringement easier and more prevalent.
According to Isenberg, “A brand can be a company’s most valuable asset, so obtaining and protecting trademarks has never been more important. The internet has made the world a much smaller place, enabling companies to sell products or services in countries that were not long ago accessible only to the biggest or best-funded players. As a result, it’s essential to be proactive about obtaining trademark rights in more jurisdictions around the globe and then identifying and enforcing those rights.
“The internet creates both opportunities and challenges. For example, the ease with which anyone can register a domain name that contains someone else’s trademark—also referred to as cybersquatting—makes it more likely that a trademark owner will encounter legal problems, but domain name dispute policies also make it easier to resolve them. In all instances, having adequate trademark rights is essential.”
Underscoring and providing evidence for imminent threats is often effective motivation for management to release more cash and human resources. Protection of trademark and brand assets is essential, and inadequate defensive measures can lead to the rise of similar or competing marks, traffic diversion, impersonation scenarios and troubling reputation issues. These risks must be made clear to management and documented whenever possible. If trademark counsel can show impending or potential threat to brand identity and equity, management may be more receptive to requests for additional funding for trademark watching and policing services.
Trademarks are poised to grow due to companies expanding their global presences and other factors, and the number of registrations and size of portfolios will likely continue to swell. Ideally, trademark counsel should work closely with their service providers to ensure the marks and brands are sufficiently protected while not breaking the bank.
When C-suite executives see the risks involved if they short-change watching and policing expenses, the hope is that budget for these expenses will increase to closely correlate with trademark growth.
Elisa Cooper is vice president of marketing for Lecorpio. She can be contacted at: firstname.lastname@example.org
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