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Consumers purchasing power is influenced by a brand's trademark and the reputation of the company. It is important that entrepreneurs learn why trademarks are an asset that can directly help grow and promote their company. Here are seven reasons why a trademark is important for your business.

1. Trademark conveys a message about your brand.

Trademarks are an efficient way for a company to express what their product means, what it does, or how their product is supposed to make to you feel. From brands such as Nike, with the "Just Do it" slogan, or the State farm slogan "Like a Good Neighbor State Farm is there" all express a feeling that the company wants to convey to consumers. 

Words, slogans, picture designs, or symbols can all be used to convey the message of the brand in a  creative fashion that cannot be achieved through copyright. Trademarks indicate the source of the brand and distinguish your business from your competitors. It is important that your brand has a trademark so that you can create and control the message of the brand.

2. Trademark protects the brand's goodwill.

The goodwill or reputation of the company is an important asset that should be protected for continued and sustainable growth. Most companies spend a substantial amount of money in marketing through social media, print media and acquiring domain names to increase consumer awareness and generate more consumers. A trademark allows you to protect your investment by creating a mark that is unique to the company and helps in stopping unauthorized users of the mark.  Through the trademark, one can control how, when and where the brand is marketed to ensure that a company's reputation is maintained. Without the trademark, it is harder or impossible to stop others from infringing on your brand and diluting the reputation of the company.

3. Trademarks are easy to maintain 

USPTO To receive a trademark one must apply at the United States Patent and Trademark Office (USPTO) and submit a government fee. The trademark application process takes approximately 8-12 months to be completely registered. To register the trademark, you must fill out the application and show the government proof of how you have been using the trademark to promote your brand or services. Once the trademark is registered, you will receive a certificate of registration. You will only be required to re-register the trademark within five or six years after the trademark was initially registered and after that every 10 years. To register for a trademark, you will be required to submit another proof of how you have been using the trademark over the years to ensure that the trademark is active. The trademark will never expire as long as you continue to use the trademark to promote your products or services.

4. More protection than a business registration

A business registration allows for one to register a business in your state only. In other words, you could have XYZ, inc. in New York and XYZ, inc in Wisconsin. The business registration protects your personal and tax liability within that state only. A federally registered Trademark protects the value and goodwill of the brand in the marketplace. Trademarks, unlike business registration, are nationally recognized. Once you receive a federally registered trademark you have the exclusive right of stopping another company or individual within the U.S. from using your trademark to sell the same products and services to the public regardless of successfully registering your business with your state. Only having a business registration leaves your company open to potential trademark infringement claims, which could force the business owner to rebrand and lose substantial investment. 

5. Advantage in court

legal issues Having a federally registered trademark gives the presumption of ownership, the trademark is active, and you have the exclusive right to use and exclude others from using the trademark. You have the option of bringing a lawsuit in both State and Federal courts. Trademark law is governed by the Lanham Act,  15 U.S.C. §§ 1051, et seq., which is better adjudicated in a federal court rather than a state court who are familiar with the principles of trademark law. Without the federal registration, you will not be able to pursue a lawsuit in federal court and will have to prove ownership of the trademark.

6. Protects against unauthorized users

A trademark affords companies the exclusive right to exclude others from using their trademark to sell counterfeit goods and be compensated for any loss due to the unauthorized use. More individuals are selling their creations and brands on platforms such as Amazon or Esty which is creating a growing problem of counterfeit goods. These platforms are offering added protections for stopping unauthorized users by having a registered trademark. 

7. Territory

A federally registered trademark holder enjoys protection throughout all 50 states. Entrepreneurs can freely expand their business in other states without formally registering your business within that specific state. 

About the Author(s)

Heather Green

Heather Green Miller is the managing partner of HGM law office in Tempe, AZ. She is passionate about helping entrepreneurs, artists, and business owners to protect and increase the value of their intellectual property and protect their key brands. Heather has served as an attorney for Legal Zoom as well as Trademarkia registering and defending trademark brands.

Managing Partner

Key Topics

7 Reasons Why Your Small Business needs a Trademark