What is a Trademark?

Registered Trademark of Coca cola

A Trademark is the means by which a business makes itself visible in the marketplace. A Trademark can be any distinctive (not solely descriptive) name or logo. The best Trademarks are instantly recognizable and conjure up in the minds of existing or potential customers things like quality, dependability, or at the very least the source of the goods or services being bought.

A trademark is often defined as: “a word, name, symbol or device that is used in trade with goods to indicate the source of the goods and to distinguish them from the goods of others”. A service mark is the same as a trademark except that it identifies and distinguishes the source of a service rather than a product. The terms "trademark" and "mark" are commonly used to refer to both trademarks and service marks.

Trademarks provide their owners with the legal right to prevent others from using a confusingly similar mark. They cannot be used stop competitors from making the same goods or from selling the same goods or services under a clearly different mark.

Examples of well-known Trademarks are: Coca-Cola, Rolls-Royce, The Apple logo and the Nike “swoosh”.



Why register A Trademark?

Prudent business people register their Trademarks with Patent Offices to gain an official record of their rights to a particular mark. A Trademark registration also grants a statutory right, subject to certain conditions, to prevent others from using the trademark without the registered owner's permission - i.e. to prevent infringement.

One of the principal aims of a business is to build up the reputation of its goods or services and by applying for and gaining a Registered Trademark accelerates the process as it serves notice on would-be copiers of the serious intent of a business to defend its position in the marketplace.

If a Trademark is properly promoted and protected it can be a very valuable asset for any business and can in some circumstances be worth more than the bricks and mortar of a business.

Generally, Registered Trademarks are protected for specific classes of products and services for periods of 10 years, which are renewal indefinitely.

How Valuable is a Trademark?

There is much talk today about “the shop front” and “the High Street”. These terms are used colloquially to refer to business visibility and to company profile. To provide some indication of the value of a trademark one needs to look no further than Coca-Cola. Coca-cola is immediately recognizable. It is an icon for capitalism and private enterprise - and it is the most valuable piece of intellectual property in the world today.

The president of Coca-Cola has even publicly remarked that if all of the company’s buildings, vehicles factories and equipment were destroyed Coca-Cola Inc would immerge from the ruins and rebuild itself provided that the Trademark survived. The loss of the Coca-Cola mark however, would damage the company beyond repair.

It is estimated that Coca-Cola Inc has a stock value of about 160 billion dollars, with the value of the physical assets being put at around 20 billion dollars. The value remaining is therefore about 140 billion dollars. This is made up of its goodwill or the intangibles of the business. So, for a company like Coca Cola, the most valuable intangible that they have is the Coca Cola trademark, the Coca Cola brand. Even if the brand makes up only half of the intangibles of the business then the Brand alone is conservatively worth 70 billion dollars.

Should you wish to learn more about good will and valuing IP please go to the Articles section of the Virtual IP library and click onto Franchising and Valuing IP Articles.

What is the Difference between a Business, Trade or Company name and a Trademark?

Business, Trade or Company names are names under which a trading entity conducts its business. They are usually used for governmental, company registration, taxation and financial reporting purposes. Invariably a company or business name will not contain a logo or other identifier.

Probably only about half of all company names are eligible for trademark Registration. In fact, many company names are confusingly similar or so descriptive that they cannot be trademarked. In other words they do not have the necessary “distinctiveness” to be used in the marketplace to distinguish one proprietors good or services from another.

A Company Name can be registered as a Trademark, but only if it is used as such, that is, used to identify wares or services

To be registrable a trade mark must be:

distinctive for the goods/services for which registration is sought, and

not deceptive, or contrary to law or morality, and

not identical or similar to any earlier marks for the same or similar goods/services.

It is important when starting a business to consider not only what the business is to be called and what name is to be used to attract customers but also whether or not the name will infringe another businesses Trademark.

PIPERS highly recommends that before taking this important step to conduct a thorough search of relevant Trademark Registers, Company name Registers, Business Registries, the Telephone Yellow pages (or similar) and domain name registries to ensure that you are free to use that name in trade.

Should you wish help with such searches please contact PatMark Research, a professional searching service at search@patmark.co.nz or visit their website at www.patmark.co.nz and they will be happy to oblige.

Please also be aware that simply because you have a company name or a domain name does not automatically mean that the name will be accepted as a Trademark.

Can I get a world-wide Trademark registration?

The simple answer to this question is no. In general, you need to apply for a Trademark in distinct regions. However, with the advent of the European Community Trademark (ECTM) and the Madrid Protocol on Trademarks it is now possible to apply for a large selection of countries with a single application.

We would be more than happy to answer any questions that you have in this matter and assist you in formulating a cost-effective strategy to obtain a Trademark in one or more countries. Links to the the the ECTM and Madrid Protocol options can be found via the “Useful Links” on the right hand side of the screen.


.For more information relating to a multiple country application please see:

European Community Trade Mark (CTM) by means of the OHIM (Office for Harmonization in the Internal Market) in Alicante, Spain www.oami.eu.int or phone (+34) 965 138 800; or

to register your trade mark through the international "Madrid Protocol" system which covers various countries around the world which have joined the Protocol as administered by the World Intellectual Property Organization (WIPO) in Geneva. www.wipo.int or phone (+41) 227 335 428.