Why Focus on Ownership
In this podcast, I outline why it's important to ensure you own what you create for your business.
There are many misconceptions when in comes to IP ownership.
In this podcast I outline why it's important to ensure you own what you create for your business. Owning what we do is about retaining control rather than giving away the value of our knowledge and skills.
Among other things, that involves understanding the role of names in business, and what is involved to legally own a name.
Failing to focus on ownership shows a fundamental lack of understanding of the interplay between branding and brand protection. The episode touches on:
- Why marketers and designers need training in intellectual property.
- What ownership of names involves.
- The 2-step process to securing ownership rights in a name.
- That ownability of brand elements involves making the right choices.
- The drawback of failing to focus on ownership
Why Focus on Ownership?
If you believe in what you’re doing, you had better make sure you own what you create for your business. You had better understand the long tail of how your work generates value. To do that involves concerning ourselves with ownership when doing business in the digital environment.
Owning what we do is about retaining control rather than giving away the value of our knowledge and skills. It’s about avoiding dumb deals. It’s about understanding that ownership of digital assets matters. It comes through knowing how to navigate intellectual property laws. It’s about learning the right things so you can negotiate properly. It’s about knowing what steps to take to secure ownership rights before implementing ideas.
Just as journalists have to have a good grasp of media law to do their job effectively, so designers, marketers, business consultants and lawyers need to understand intellectual property laws. Just because it’s a legal subject does not mean those who aren’t lawyers don’t need to know their way around IP laws. If you work with businesses then you need a sound grasp of how IP impacts business and brand.
Founders often don’t know what intellectual property even means, but when they consult an adviser, be it a designer, marketer, business consultant, or lawyer, they expect their adviser to know everything pertinent to their area of expertise. IP law is intrinsic to the work designers, marketers and business consultants do. Hence, it’s an important skill that these professionals need.
Among other things, that involves having a sound understanding of the role of names in business. Names are the single most important concept everyone in business needs to properly understand, especially if they are choosing new ones.
A name is to a business what a plot of land is to a development. Just as you would first secure ownership of land before investing in building properties on it, so you need to own the name you intend to use to build your brand around before promoting your brand.
Think about it. Everything you do in business involves raising awareness of your existence. It’s about getting your brand name known. Names are a designation of origin. That means they identify us. The name is how people recognise who is behind a particular product or service.
All the associations we have about brands attach to their name. Most brands have other identifiers too – taglines, sounds, music, symbols, colours, shapes etc. The purpose of these identifiers is to bring the brand name to mind. So, owning the name is vital.
To own a name involves a two-step process. First, it’s essential to check that the name you want to own is actually ownable and available. Ownability is a large subject that I’ll leave for another day. However, it must be really well understood by anyone who names anything in business. Availability is about the name not belonging to someone else. It mustn’t be like that of existing businesses in your category. That’s because the law only allows businesses to share names if they operate in different spheres. For example, the name Polo belongs to 3 unrelated businesses. They can use the same name because they are in entirely different areas of business: clothing (Ralph Lauren), confectionery (Nestle), and automotive (Volkswagen).
The second step in the process to securing ownership rights in a name is to register a trademark. If you skip the first step and just go straight to registering a trademark then your rights rest on shaky foundations. Always start by checking that the name you are using is ownable and available before applying to register it as a trademark.
Just as I would expect a journalist to understand the basics of how defamation laws work, so I expect a designer or marketer or business consultant to be familiar with the law around names. Even marketing companies that outsource naming to specialists need to know the basics of the law given that the name is a key identifier of a business.
Names have a fundamental significance which, if not properly understood, leads to people confusing marketing and promotion when naming their business or products. Paradoxically, in the long run, it can reduce the value of a business to be using a name that’s not ownable.
The name is what enables the world to recognise a business. So no business would want to lose the right to use its name. Nor would they want a competitor to use a similar name to divert business away from them. Yet, it’s not at all unusual to find that a business hasn’t secured ownership rights to its name.
All the goodwill, and brand equity resides in the name but people take their name for granted. They are invariably in disbelief when something happens to shake their foundations. When they realise that their rights are quite precarious if they haven’t secured ownership in their name, they’re often keen to protect their rights. Sadly, for some business owners it can be too late by then.
One reason people have a false sense of security about their name, is that it’s not compulsory to register a trademark in the UK or USA. Another cause of confusion is that they may well have registered a domain or company name and assume that’s all that’s necessary to secure ownership rights in a name. However, the right to use a name comes from trademarks not domain or company registration.
When you’re choosing a name for a new business you are presumed to have checked the trademark registers. So, if your name is like an existing trademark owner’s name you are automatically in the wrong.
If you’re using a name without having registered it as a trademark, your rights won’t be apparent when people search the trademark registers when they’re choosing names. That means you are in a weaker position than someone who owns their name. You potentially have to go through costly litigation to establish that you have earlier rights in your name. And you could discover that someone else has been using a similar name to yours before you even adopted your name.
If you lose the argument, you would be required to rebrand. But even if you win, it could cost you 50 times as much or more than it would have cost you to simply register your name as a trademark in the first place.
Why do people expose themselves to the risk of costly disputes and the possibility of losing their right to use a name, when it’s quite inexpensive to secure ownership?
The name is the single most important asset of a business after all.
The time to secure rights in the name is before you start to build your brand around it. Failing to focus on ownership shows a fundamental lack of understanding of the interplay between branding and brand protection. The two must work hand in hand.
I’ve known agency owners keen to register a trademark for a name, such as the title of a book they wanted to write (often quite descriptive names), who hadn’t protected their agency’s name. When I ask them why they aren’t prioritising the registration of that name, they mumble something to the effect that they didn’t know it was necessary to register it. Yet here they are seeking to protect a new name that is often potentially not even ownable.
Not understanding the importance of ownership in the digital environment we live in is a basic mistake to avoid. There are so many elements of intellectual property that impact business. IP is essential to understand especially for designers who create new brands. And naming is one important aspect of this, which is why I’ve focused on it today.
What I hope this piece will have highlighted is the importance of prioritising the gaining of skills that are related to the work one does. Specifically, I am hoping it will highlight why a good grasp of intellectual property laws is essential in the digital environment we now live in. The value of most businesses is no longer in physical assets. Even businesses that sell physical goods will generate more value in their intangible assets, such as their name, than in their physical stock if they succeed. So, ownership of intangibles should be a key focus.
Just as you’d want to understand how company law impacts your plans when you set up a new business, so you need to learn about IP laws to own the intangible assets that represent the value you create in business.
You would be profoundly pissed off if someone else is making their money from what should have been rightfully yours. Yet it can happen all too easily if you don’t acquire this basic business skill in the 21st century of understanding IP. Learning what’s involved to secure ownership of intangible assets such as names, copyright content, trade secrets, patents, designs etc is where the value of knowledge lies nowadays.
I’ve recently launched the Brand Tuned Program which is a branding 101 for designers, marketers, business consultants, lawyers and founders. It’s what you need when dealing with start-ups or early-stage businesses.
I’m creating another program just on Identity and Distinctiveness. It would suit those looking for an in depth understanding of names and identifiers so that when they are creating a new product name, logo, tagline, character symbol, jingle, or choosing colours and the like they can address ownership of these identifiers as part of their brand strategy.
If you’re a designer, marketer, business consultant or lawyer on the Brand Tuned newsletter list or on the LinkedIn Brand Tuned list of subscirbers, I may approach you soon to ask a few questions to progress my research on this. Do let me know if you want to be involved.