Trade marks provide several benefits for businesses. For example, a trade mark provides its owner exclusive rights to use, commercialise and sell its mark. Trade marks can also increase the value of a business over time. In addition to the benefits to businesses, trade marks also protect consumers. This article will take you through three ways trade marks protect consumers.
Our free Trade Mark Essentials in New Zealand guide explains how to register and defend your trade mark registration.
Reduce Harmful Anti-Competitive Behaviour
One of the main ways that a trade mark protects consumers is by preventing anti-competitive behaviour. This is because trade marks – and intellectual property (IP) more broadly – compete against other businesses in the same market. This is particularly important for smaller businesses competing against significant businesses in the same industry.
Competition in business is usually crucial for consumers because it leads to:
- competitive prices;
- higher quality goods and services;
- more variety; and
- innovation.
Intellectual property plays a critical role in reducing anti-competitive behaviour. This is because using two similar brands in the same industry can lead to consumer confusion. In particular, having two competing businesses with similar or identical trade marks only negatively impacts consumers.
When a business applies to register a trade mark, it will be assessed to ensure it is not identical to or confusingly similar to an existing trade mark. An Intellectual Property Office of New Zealand (IPONZ) examiner will assess this. Further, other businesses will also have the opportunity to oppose the registration of a trade mark if they perceive a conflict with their business.
Preventing consumer confusion is essential for all businesses. Consumer confusion may result in:
- reduced sales;
- dissatisfaction with goods or services; and
- difficulty communicating with consumers.
Attest to a Business’ Reputation
Another significant way that trade marks protect consumers is by attesting to the reputation of a business. Trade marks are the very foundation of a company’s brand and reputation. This has several obvious benefits for trade mark owners. For example, by registering a trade mark, the owner can prevent others from using their mark without their permission. In turn, this protects consumers’ perception of a brand.
Despite the obvious benefits to a business, this also helps protect consumers. A trade mark ensures consumers know exactly who the product or service is offered by. If a consumer purchases a good or service and is satisfied with it, they will associate the brand with high-quality goods or services. This inspires customer loyalty which leads to more sales over time.
On the other hand, if a competitor used a trade mark without permission from the owner, it can damage the brand’s reputation. This could cause irreparable damage and result in a reduction in sales over time. This emphasises the importance of registering your trade mark rights and enforcing these rights.
Continue reading this article below the formCommunicate with Consumers
Finally, another way that trade marks protect consumers is by serving as an effective communication tool. Trade marks are directly associated with a consumer’s purchasing decisions and can help consumers make better choices about their consumption of goods or services.
The market is very competitive, which makes brand messaging all the more critical. From simply looking at a trade mark over time, consumers can identify:
- what brand they are looking at;
- the company’s reputation; and
- emotive or intellectual messages sent by your business.
By distinguishing your brand from others, consumers are less likely to look for alternative items. As such, your mark might be a critical factor behind a consumer’s purchasing decision.
Certain types of trade marks can help share messages about your brand with consumers. For example, a business logo might use colours that emote certain emotions in a consumer. It might also use symbols associated with specific values that can then be conveyed to customers directly.
Key Takeaways
In addition to the benefits to businesses, trade marks also protect consumers. Some of the key benefits of trade marks to consumers include they:
- reduce anti-competitive behaviour;
- attesting to a business’s reputation; and
- provide a means of communicating with consumers.
If you need assistance understanding why you should register a trade mark in New Zealand, our experienced intellectual property lawyers can help as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0800 005 570 or visit our membership page.
Frequently Asked Questions
A trade mark gives its owner the exclusive rights to use, license and sell their mark. This can also lead to an increase in a business’ value over time.
Trade marks can help protect consumers by reducing anti-competitive behaviour. Trade marks also attest to a business’s reputation and provide a means of communication with consumers, ultimately informing consumers’ purchasing decisions.
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