Why Trademarks Are Important to a Business: Understanding the Value of Intellectual Property

Courtesy of the U.S. Patent & Trademark Office

Eight hundred eighty billion dollars. According to Statista, that’s the value of the Apple brand. Not the value of the actual phones or computers or watches or ear buds. It’s just the value of their brand names, slogans, and logos. It’s the value of their trademarks.

Trademarks are an essential component of any business and understanding them is crucial for any business owner.

This article aims to demystify the basics of trademarks, explain what they are, why they are vital for your business, and how to apply to federally register one.

The basics of trademarks

What is a trademark? A trademark can be any word, phrase, symbol, design, or a combination of these things that identifies your goods or services. It’s how customers recognize you in the marketplace and distinguish you from your competitors. Trademarks can also convey intellectual and emotional attribute messages about a business, which can be effective communication tools.

Traditionally, the term “trademark” is used for brands that identify goods and the term “service mark” is used for brands that identify services. However, it is acceptable to use “trademark” to refer to both goods and services.

A trademark:

• Identifies the source of your goods or services.

• Provides legal protection for your brand.

• Helps you guard against counterfeiting and fraud.

Trademarks are often confused with patents and copyrights, but they actually protect different types of intellectual property. Trademarks protect brand names, slogans, and logos. Patents protect new inventions and processes. Copyrights protect original artistic works. So if you invent a new produce sorting machine, you might apply for a patent on the new machine, federally register a trademark for the brand name of the machine, and register a copyright for the commercial you create to advertise the machine.

A common misconception is that having a trademark means you legally own a particular word or phrase and can prevent others from using it. However, you don’t have rights to the word or phrase in general, only to how that word or phrase is used with your specific goods or services.

For example, Blackberry, Limited federally registered BLACKBERRY as a brand name for smart phones. That doesn’t mean they own the word “blackberry.” But they do have the exclusive right to use the word to indicate the source of their smart phones and related goods and services.

Another common misconception is believing that choosing a trademark that merely describes your goods or services is effective. Actually, creative and unique trademarks are more effective and easier to protect.

For example, Pepsico federally registered PEPSI as a brand name for soft drinks. It’s a strong trademark because it’s a made-up word that doesn’t describe what the goods are. Consider whether the trademark would be as strong if Pepsico had named their beverage SODA POP. Consumers wouldn’t know who made the beverage. They would only know what the beverage is.

Keep in mind, there is a difference between owning a trademark versus having a registered trademark. Owning a trademark means that you do have rights, but they are limited and are only applicable to the geographic area where you are providing your goods and services. Though you are not required to federally register your trademark, it is something to consider especially if you want stronger rights that are valid nationwide. Plus, you might consider federally registering your mark if you plan on expanding your business to include selling goods online.

There are several benefits to federally registering your trademark including:

• Trademark is listed in the United States Patent and Trademark Office (USPTO) database of registered and pending trademarks. This provides public notice to anyone searching for similar trademarks. They will see your trademark, the goods and services on your registration, the date you applied for trademark registration, and the date your trademark registered.

• Legal presumption that you own the trademark and have the right to use it. So, in federal court, your registration certificate proves ownership, eliminating the need for copious amounts of evidence.

• Can use your application or registration as a basis for filing for trademark protection in foreign countries.

• Right to bring a lawsuit concerning the trademark in federal court.

• May use the federal trademark registration symbol, ®, with your trademark to show that you are registered withthe USPTO. This may help deter others from using your trademark or one too similar to yours.

• Record your registration with U.S. Customs and Border Protection (CBP). They can stop the importation of goods with an infringing trademark.

A trademark is always connected to the specific goods or services sold to customers with that trademark. You can’t register a word, phrase, symbol, or design as a trademark without specifically identifying the goods or services being used. Your trademark isn’t limited to one good or service. It can be used with many different goods or services, and include both goods and services.

Although the determination of whether you have goods or services can be confusing, it’s critical that you make the correct identification.

Think about it this way: What do customers purchase from you? An actual physical product that bears your trademark? Or do they hire you to perform an activity for them? If it’s products, you have goods. If it’s activities, you have services.

For example, a registered trademark for the name A GOOD YARN for a bookstore would prevent another company from registering the name A GOOD YARN for another bookstore. By being specific about the goods or services your trademark represents in your registration, you clearly identify the scope of use. You can legally prevent others from registering the same or a similar trademark for related goods or services without your permission.

Getting started

Once you have determined that federal trademark protection is right for your business, you are ready to start the process to register your trademark with the United States Patent and Trademark Office (USPTO).

The basic steps typically include:

• Search the USPTO database to determine if anyone has already applied for or registered a trademark that is similar to yours and used with related goods/services.

• Determine the version of your trademark you want to register.

• Identify your goods and/or services. Set up a USPTO.gov account.

• Prepare and submit your application.

• Work with the assigned USPTO examining attorney if an issue arises with your application.

• Receive notification of registration, if successful.

• Maintain your trademark registration.

Trademark resources

It can seem a bit intimidating when applying to register a trademark for the first time. That’s why the USPTO has several resources available, in person and online, that can assist in making the process go smoothly.

The Trademark Assistance Center (TAC) is the main support center for all customers, from first-time filers to experienced trademark applicants, and can answer your questions on a variety of trademark topics. You can speak with a representative in person at our headquarters in Alexandria, or call or email. Learn more at www.uspto.gov/ TrademarkAssistance.

Additionally, the USPTO operates Patent and Trademark Resource Centers (PTRCs) in most states. The PTRC Program administers a nationwide network of public, state and academic libraries with librarians specifically trained on patent and trademark topics who can direct you to USPTO resources, explain the application process and fee schedule, and demonstrate how to use search tools, among other free services. Find a PTRC near you by visiting www.uspto.gov/ PTRC

If you’re interested in online resources, our website contains information on trademark basics, a trademark basics registration toolkit, our trademark search system, our trademark application filing system, and the online Intellectual Property (IP) Identifier tool. We also provide countless in person and virtual no cost trainings. To access these resources, visit us at www.uspto.gov