A small business is vulnerable to failure in so many different ways that it can be difficult for new entrepreneurs to find a path toward success. Unfortunately, one of the simplest ways to protect a new business is with trademarks — but many young and inexperienced business leaders make trademark mistakes that only increase their risk.
Trademarks are essential tools for securing business branding, but too many entrepreneurs misunderstand how to leverage trademarks effectively. Here are a few common trademark mistakes that no business leader should ever make.
Misusing the Trademark Symbol
Anyone can place the trademark symbol — TM — after a name, phrase or logo used in business, but adding that symbol does almost nothing to protect those brand and business assets. Even when an organization consistently places a TM after important components of their brand, they have essentially no legal recourse should another business begin operating with the exact same name, logo, slogan and more. Business leaders need to know how to trademark a name to ensure that it is legally protected against use by another business entity.
Neglecting Trademarks in Commerce
Registering a trademark might provide more legal protections than simply using a name, logo or other brand asset, but registering and then neglecting to use a trademark negates those legal protections in most cases. Bad actors could easily register unlimited names, logos and more to prevent entrepreneurs from developing businesses without purchasing licenses to use those trademarks, so to prevent this, most trademark policies require trademarks to be used in commerce to maintain their protections. Generally, business leaders should only apply for trademarks when they have already used them in commerce or if they have specific intentions for the trademarks in the near future.
Skipping Trademark Research
Around the world, there are more than 334 million companies — which means that many trademarks are already taken. To avoid the high expense of a rebrand, business leaders should invest in thorough trademark research before deciding upon a name, logo and other critical brand elements. Leaders can search the U.S. Patent and Trademark Office database to find trademarks that might be dangerously similar and to identify safer opportunities during the brand development stage. Businesses might want to work with trademark experts if they expect to expand internationally and need assistance identifying trademark conflicts in other regions.
Investing in a Non-distinctive Trademark
On one hand, businesses want their names, logos and such to help customers understand and identify their products and services without any confusion. On the other hand, businesses cannot register trademarks that are overly simplified and too descriptive, as they will refer to a general class of products or services rather than a specific company’s brand. Business leaders need to be careful to make their trademarks distinctive, or they will struggle to protect them and might encounter legal trouble regardless.
Confusing Trademark Classes
On trademark application forms, businesses must be expressly clear about the class of products or services that will be covered under certain trademarks. Trademark law allows similar names and logos to be used in different applications, as there is assumed to be little room for confusion between companies operating in different sectors and targeting different audiences. For example, a tattoo shop and a leadership consulting firm might have similar trademarks, but because they are not providing remotely similar services, they benefit from the same legal protections. Of course, failing to accurately classify trademarks can give businesses trouble, especially if there are trademark conflicts existing in different classes.
Failing to Enforce Trademarks
Applying for and registering trademarks is the first step toward protecting important brand assets. However, no government agencies oversee trademarks in commerce, so companies are fully responsible for taking additional steps to enforce their trademarks in the real world. If business leaders identify another organization in the same class operating with similar trademarks, they need to act immediately to prevent trademark infringement. Not only does allowing another company to use similar trademarks potentially harm one’s brand, it also could result in the loss of trademark rights. If a cease-and-desist letter does not stop another company from using registered trademarks, a business may need to take additional legal action to keep their brand safe.
Protecting a business’s trademarks is relatively easy, and it can make a significant difference in the safety and security of the business’s brand. Business leaders should take steps today to avoid trademark mistakes and stay on the path toward success.
