“Every brand has at its core a substance that gives it strength.”[1] In the 21st century, the reality is that companies are being penalized for their success with certain products. Genericide occurs when a brand no longer denotes its origin, but rather is used to refer to a whole category of products. Yo-yo, Escalator, and Aspirin – these are just a few of the names consumers use to refer to a category of products, unaware that these brands were once federally protected trademarks. Long gone are the days of companies having to merely worry about overexposure through the use of print and media. With the advent of the Internet and tons of other related technology, overexposure of a brand has become an imminent reality.
Today, over 40 types of marketing and delivery channels exist. This non-exhaustive list ranges from more traditional channels, such as magazine and billboard advertising, in addition to lesser-known more innovative channels, such as QR codes and smart TV and tablet apps.
Customers are willing to pay a premium for brands they consider to be high quality. Because of a brand’s ability to greatly affect a business’s profits through higher price margins, they have become a vital aspect of the quickly evolving economy and an indispensable feature of business theory and practice. Brand personality, which views the concept of a brand like an individual’s personality, helps consumers form a relationship with the brand and differentiate the product from other similar products.[2] It follows that if a company is unable to build a strong brand personality, it will unfortunately experience great difficulty in finding success. Moreover, consumers tend to remember well-liked, robust, and distinctive brands once they gain familiarity with them.
Moreover, some of the intangible benefits of a brand name result in direct, tangible success. Brand names allow companies to thrive off their reputation and succeed in the marketplace by enabling customers to connect with products on an emotional level. Brand power provides a company with great benefits. As a result, brands equal value.
Creating valuable brands directly relates to customer loyalty. Since companies are offering nearly identical services, branding has become a crucial element of success. The change in focus on brand research to the abstract and intangible elements of brand knowledge[3] is evidence of the increased importance of these concepts. Consequently, since strong brands lead to increased sales and larger profits, companies understandably invest significant time and money into a brand’s development.
Dependence on intangibles has become an increasing trend in society as the economy has shifted towards a more technology-driven focus, and companies thus derive the majority of their value from intangible resources.[4] This trend is evident through various electronic media platforms. With the upward trend of technological platforms, brands have become increasingly important. For example, at one point in time, Coca-Cola had over 93 million “likes” and 1.1 million people talking about the brand on Facebook, and 2.85 million Twitter followers.
Exclusive use of these intangible assets leads to increased innovation. Trademark protection of brands gives a company the necessary security it needs to comfortably invest time, money, and resources into creating and developing its brand. As initially pronounced by John Locke and subsequently discussed in Peabody v. Norfolk,[5] one is entitled to the end result of his labor which added value to a product. Similarly, companies should be entitled to own the brand names that they substantially invest in.
More than ever, companies are spending a larger portion of money on knowledge than on raw materials or labor.[6] However, after a company invests such a vast amount of time and money into developing and strengthening its brand, there is a significant possibility that it will fall victim to genericide. Accordingly, it is imperative that companies are protected and avoid the potential pitfalls that lead to genericide.
The Law Office of Aaron M. Schlossberg, P.C.
(This writing is for general information purposes only, should not be construed as legal advice and does not establish an attorney-client relationship.)
[1] Holly Wehmeyer and Jeff Scurry, Differentiating Your Firm Through Branding, 2 CPA Prac. Mgmt. F. 5 2006 (Dec. 2006).
[2] David A. Aaker, Measuring Brand Equity Across Products and Markets, 3 Cal. Mgmt. Rev. 38, 113 (1996).
[3] Karl Moore and Susan Reid, The Birth of Brand: 4000 Years of Branding History 25 (MPRA Paper No. 10169, 2008), available at http://mpra.ub.uni-muenchen.de/10169 (internal citations omitted).
[4] Stephen Ball and Kathy Chapman, Ongoing IP Due Diligence: The Duty to Protect Valuable Corporate Assets, 19 Bus. L. Today 29, 29 (2009-2010).
[5] Peabody v. Norfolk, 98 Mass. 452, 457 (1868).
[6] Catherine L. Fisk, Knowledge Work: New Metaphors for the New Economy, 80 Chi-Kent Rev. 839, 857 (2005).
ASchlossberg
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