(Note: This is the second post in our ongoing “IP Protection for Brands” series. You can read the first post, discussing Amazon Brand Registry, here.)
How much is your company’s brand worth? I’m talking actual dollars here, or as a percentage of your business’s overall revenues. If you’re like most companies, you haven’t gone through the exercise of determining the true value of your brand either in direct monetary terms or in terms of the percentage it contributes to your company’s bottom line.
So let’s quickly come up with a ballpark idea of just how monetarily valuable your brand is to your business. Imagine either of the scenarios below happening to your company, and then try to estimate how much money they would be costing you in revenue, market share, distribution, etc. (Warning: You might want to steel yourself before reading further.)
Nightmare scenario #1:
A crooked manufacturing company starts cranking out counterfeits of your products. Those knock-offs find their way onto Amazon.com and other online marketplaces. They’re advertised for far less than your legitimate retailers’ prices, leading many unsuspecting shoppers to buy them. And of course that eventually leads to furious customers writing scathing reviews online about your products.
Eventually this rampant counterfeiting makes the news, and shoppers become worried about buying your products from any online source.
Nightmare scenario #2:
One of your wholesale partners sells a good portion of the inventory they’ve bought in bulk from your company to a few retailers who, it turns out, are actually shady operators that have no official relationship with your company and are happy to dump your product on the retail market at prices well below the ones you’ve specified if your reseller pricing policy. They’re not actual partners of yours, after all, so what do they care about violating your guidelines?
As you can imagine, a lot of comparison shoppers find these rogue retailers listing your products, and sales quickly shift away from your legitimate retailers to these crooks. And because you didn’t catch the problem and deal with it quickly enough, the problem costs you some of your biggest retail partners.
Best Practices for Safeguarding Your Brand’s IP
If after reading those nightmare scenarios you have a basic idea of how much either of them could cost your company (I’m guessing a small fortune in both cases), then you have a better sense of how important it is to protect your brand’s intellectual property at all times.
Rogue sellers hijacking your product listings from your legitimate retail partners, or counterfeiters in effect using your brand to mislead and steal from your customers, are both examples of how losing your IP to bad actors can cause all sorts of damage to your company. So here are the steps you should be taking to safeguard your brand’s IP:
1. Monitor your products’ presence online 24/7
The first step to safeguarding your brand’s IP online is to know what’s happening with it right now, and at all times, so you can act immediately to deal with a problem before it becomes one of those nightmare scenarios above.
You can’t afford to wait to hear from angry customers or retail partners that there’s a company out there (or several of them) misusing your intellectual property to sell your products, or counterfeit versions of them. At that point, you’ll have already begun to lose credibility and trust with your customers and partners.
So you need to keep a watchful eye on your products all across the Internet, and have a system in place to alert you if anything seems off about any of those sellers. The Amazon Brand Registry, for example, can help you monitor how your IP is being used across that marketplace.
But just using the sophisticated tools Amazon gives to registered brand owners will still require frequent manual monitoring, so ideally you’ll want an automated brand protection solution to help you. And moreover, you’ll need comparable IP-protection software for monitoring the rest of the web—not just Amazon—which is another reason you’ll ideally want an automated platform watching your brand’s IP 24/7.
2. Establish an Authorized Dealer Network
Now that you’re monitoring your brand’s presence across all online marketplaces and eCommerce sites at all times, your next step should be to tighten up any potential leaks in your distribution chain (which is where a lot of these problems begin).
That means implementing an Authorized Dealer Network that lets you limit which retailers you will allow to sell your products, and then instructing your wholesale and distribution partners to limit their sales to only retail companies on your approved list.
The great thing about an Authorized Dealer Network is that, unlike most other types of reseller policies, this program isn’t primarily about controlling the advertised or resale prices of your products, which means you have a lot more legal freedom to be strict and demanding when it comes to the guidelines and consequences you put into this policy.
For example, you can let your wholesalers know that if they sell your inventory to a retailer not on your approved list, not part of your Authorized Dealer Network, they could face serious consequences, including being blocked from buying any more of your product for any period of time you choose—up to and including forever.
This will help your distribution partners absorb some of the responsibility for making sure your product doesn’t leak into the hands of rogue retailers who could do your brand harm.
3. Monitor your brands’ customer ratings and reviews online
Let’s say a counterfeiter is producing knock-offs of your products and retailing them online. And let’s further assume the online sales listings are actually pretty good representations of your legitimate retailers’ listings—because this counterfeiter is also stealing your company’s sales copy and product imagery from those legit retailers.
Often one of the first clues you’ll receive about such a counterfeit operation is a furious customer’s online review—fuming about the lousy quality of the product or the realization that its price was too good to be true and now they can see why. If you’re lucky, the review will actually include phrases like “obvious fake” or “clearly a knock-off.”
So set up a process to track all of your products’ reviews across all marketplaces and eCommerce websites, 24/7. You’ll want automatic, immediate alerts for new reviews or star rankings that hit the web, and you’ll definitely want to set up specific alerts for your team anytime a customer review is published containing words like “counterfeit” or “fake.”
Again, this is going to take a lot of manual work if you try to manage the process in-house. Which is another reason you’ll want an automated platform to monitor your online reviews.
4. Build your brand’s IP terms and conditions into your partner agreements
Let’s assume you have obtained trademarks, registered marks, and copyrights for content related to your brand—product names, taglines, and sales copy, for example.
(If you haven’t obtained these legal rights, that should be your step 1.)
Every time this content appears in any published form without the relevant intellectual-property marks accompanying it, you increase your brand’s risk of losing the rights to that IP.
So you should of course make sure your internal teams and any agencies you work with are fully aware of all IP rights your company has secured, and make sure they know they need to include those marks—say, a copyright below your product’s primary sales copy—when they use that content in promotional material.
But if your company sells through resale channels, then you’ll also need to make sure your distribution partners are also adhering to these IP rules. Build these guidelines into your contracts, and demand that wholesalers, distributors, vendors, partners, and any third party representing your brand is representing it publicly in such a way that protects and strengthens your brand’s IP.
5. Don’t try to protect your brand’s IP alone
Finally, perhaps the most important best practice we can suggest is to avoid trying to handle all of the mission-critical but time-consuming tasks required to safeguard your brand’s IP—and instead partner with a team of experts who specialize in watching over their customers’ brands and responding to problems on their behalf.
Turns out when you combine the right brand protection software with the right team of experts, the process is far more effective and affordable than you might think. Let us show you how it works.