Trademarks are a kind of intellectual property that consists of specific signs, designs, or expressions that serve to identify products or services from those created by competitors. Typically, trademarks relating to services are referred to as “service marks”. Trademarks are registered with the United States Patent and Trademark Office. In the twenty-first century, trademarks are often one of the most important assets that a business has. Consumer trust in a product often hinges on their recognition and trust of the trademark. A business’ ability to raise its prices, or grow revenue is a function of the status of its trademarks among customers. As an entrepreneur, it is important for you to understand what makes trademarks so important for business.
Communicating With Your Customers
Trademarks are a form of communication with your customers. They are a kind of language. They signal to your customers and potential customers, through a brand, or logo, what the values of your business are, the standards to which the business holds itself, and the kind of relationship and customer experience that you promise your customers.
A trademark can be a word, catchphrase, a symbol, or something else. For instance, Nike’s “Swoosh” logo is a globally recognized trademark that transcends language.
Trademarks Enhance Your Discoverability
Today, a business competes, not just with a rival in the same town or city, but with competitors from across the world. This state of hyper-competition means that discoverability is harder than ever. Your business has to stand out. Trademarks are an efficient way of making your business more discoverable by customers. Rather than typing out reams of pages explaining what your business is, what its values are, the operating standards it lives by, etc, a business can communicate all these things with nothing more than a symbol. It is enough for a consumer to see an Apple logo to grab a customer’s attention.
Trademarks Can Be Deployed In Social Media
When customers are surfing the web or go on social media platforms, looking for products or services, they think in terms of trademarks. With a trademark, customers are more likely to visit your website or social media account, leading to higher search engine rankings, which itself will generate even more traffic, drawing in more customers, and making your trademark more recognizable.
Trademarks are an Important Asset
Trademarks are an asset. This is to say that they are something which your business controls or owns and from which your business derives economic benefits. Those economic benefits may increase over time, increasing the value of your trademark.
Trademarks may generate value beyond the core activities of your firm. For instance, the power of Apple’s trademark is such that many people would consider buying an Apple Car even though Apple has never built a car. Apple’s trademark transcends its products and services and enables the business to enter new markets with credibility.
The importance of trademarks is easily seen from an accounting perspective. They are classified as an asset, alongside plant, property, and equipment, and other accounting items, They can be bought, sold, or even licensed, or used as collateral to obtain a loan for the business. Many businesses have trademarks that are so valuable they are worth billions of dollars. For instance, the Google trademark is worth an estimated $44.3 billion!
Get more insights on trademarks and find out why you should register a trademark.
