One of the most common misconceptions we hear from new business owners is:
"I've bought the domain name, so my brand is protected, right?"
Unfortunately, the answer is usually no. Many businesses discover this only after investing thousands of dollars into branding, websites and marketing.
Securing a domain name is an important step when launching a business, but it is very different from owning a registered trade mark. While a domain name gives you the right to use a particular web address, a trade mark registration gives you exclusive rights to use your brand name in connection with your products or services.
If you're investing time and money into building a business, understanding the difference can save you a lot of headaches down the track.
A domain name only gives you a website address
When you register a domain name such as www.prettycakes.co.nz you have obtained the right to use that internet address, provided you continue to renew it. What you have not necessarily obtained is ownership of the brand name PRETTY CAKES.
Registering the domain name alone will not stop others using the name PRETTY CAKES and will not prevent others registering other domain name variations and extensions such as www.prettypetalcakes.co.nz, www.prettypoppycakes.nz, www.prettycakes.org.nz and www.prettycakes.kiwi etc.
Someone else may already own trade mark rights in that name. In some cases, the trade mark owner could even require you to stop using the name despite your ownership of the domain. This can occur where the domain name infringes an earlier trade mark registration or creates consumer confusion. Imagine launching PRETTY CAKES, building a website, printing signage and growing a customer base, only to receive a letter from the owner of an earlier PRETTY CAKES trade mark registration requiring you to rebrand. The cost of changing your business name can be far greater than the cost of obtaining trade mark advice at the outset.
If you want exclusive rights, you need a trade mark
A registered trade mark gives you a national monopoly in connection with your nominated goods and services. This protection is not only for a name but can be other types of marks such as logos, stylised words and taglines. In some circumstances, colours, sounds and smells can be registered.
Unlike a domain name registration, the owner of a trade mark registration has a strong legal basis to stop misuse. They can prevent competitors from using an identical or confusingly similar mark, send formal warning letters, take enforcement action against infringers, file customs notices and file takedown notices with online platforms. These exclusive rights help businesses distinguish their products and services from those of competitors, build customer recognition, and safeguard the value of their brand as a commercial asset.
Trade marks can deter copycats
One of the benefits of registration is not just enforcement but deterrence. A registered trade mark appears on the official trade marks register in that country. In New Zealand, that's the Intellectual Property Office of New Zealand (IPONZ). The IPONZ register, as well as many overseas registers, is publicly available and can be searched. A competitor considering a similar name to yours may abandon those plans when they discover an existing registration during a clearance search of the register.
A registered trade mark sends a clear message that you take your intellectual property seriously. In contrast, owning a domain name alone often does little to discourage competitors from adopting similar names.
Trade marks can be enforced across multiple platforms
Modern businesses do not exist solely through their websites. Customers find businesses through a variety of platforms including:
Social media;
A domain name only protects one internet address. A trade mark protects the brand itself wherever it appears in the marketplace.
As your business grows, this broader protection becomes increasingly important.
Trade marks are valuable business assets
Intellectual property is an asset which can be bought, sold and licensed. Investors and buyers often place significant value on registered trade marks. It demonstrates business acumen by having a robust intellectual property strategy in place which experienced investors will look for. It also gives confidence to investors because the right protections are in place and any legal risks around ownership have been mitigated.
A domain name can certainly have value, particularly if it is memorable or generates significant traffic, but it is usually the trade mark rights that underpin the long-term value of a brand.
Don't just be easy to find online, be protected
When starting a new business, it's easy to focus on practical matters such as websites, social media accounts and marketing. However, your brand is often one of your most valuable assets.
Buying a domain name is a good start and every modern businesses should secure relevant domain names where possible, but it should not be mistaken for legal protection of your brand. For most businesses, the brand itself is often far more valuable than the website address. Before investing heavily in a business name, consider obtaining trade mark advice and conducting appropriate clearance searches. A registered trade mark can provide stronger protection, greater commercial value and significantly more certainty as your business grows.
The key is to remember that domain names and trade marks serve different purposes. A domain name helps customers find you online and drives traffic. A trade mark registration gives you exclusive rights to use and protect your brand name for your goods and services and protects your reputation.
Liked this article? Ready to explore your options for tailored brand protection? Get in touch with our experienced intellectual property team today.