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Brands: Finding the sweet spot! Aligning marketing and legal considerations

17 November 2017

Brands, whether they be the name of your business or the name for your products/services, are one of the most important assets of any business. They distinguish your business from all others, including your competitors and act as a guarantee of the characteristics and quality of your products/services.

Can you imagine cola products without Coca Cola, search engines without Google, computers and mobile phones without Apple and sports clothing without Nike? These brands have become some of the most famous brands in the world due to them being carefully selected, protected and enforced by their owners. Without these distinctive names, each business would be lost in a sea of brands, given the competitive nature of the markets in which they operate.

When a new business is considering names for its business or an existing business is considering a new name for a product line, it is important that sufficient time and energy is expended selecting a name. The best brand names are those that provide immediate insight into the owner and its products/services and are distinctive of the owner’s business.

Such brands strike a good balance between the often-competing commercial and legal considerations and are the so-called ‘sweet-spot’ brands. This means the brand name is commercially attractive because it does not require the owner to spend lots of time and money on an advertising and marketing campaign to educate the public about the characteristics and quality of the new business or new product/services range. At the same time, the brand is also easy to register as a trade mark because it is not similar to existing names, is inherently distinctive, and for much the same reasons, readily enforceable.

A good example of a ‘sweet-spot’ brand is Nike. The name aligns with Nike’s business offerings and values because "Nike" is the name for the ancient Greek goddess of victory. The careful selection of a name like this means it is immediately memorable, tells consumers about the ethos of Nike and its products. The name is also one that has been easy to protect and when required, enforced against infringers. Kaitaia Fire and Fonterra are good local examples.

Businesses should therefore give considerable thought to the selection of the name they wish to use and should look at balancing the commercial and the legal considerations. In practice, this means getting your marketing/creative teams and legal advisers alongside one another early and then choosing a name that hits the sweet spot. Such considerations became even more important when a business is looking to expand into new jurisdictions, especially when foreign languages are involved, because not all brand names translate well - just ask Ford, who blundered when marketing its Pinto vehicle in Brazil, which in Brazilian Portuguese means "tiny male genitals"!

This article was written by Hamish Selby for the NBR (November 2017).