A trademark is a word, phrase, symbol, or design that identifies and distinguishes the source of goods from those manufactured by others. A trademark may signify regional affiliation, sponsorship, or endorsement. The purpose of a trademark is to prevent confusion as to the source of goods and services. By identifying one’s goods as originating from a particular region, company, or individual, consumers can be confident in their purchase without having to do additional research into who made them. 

For example, Nike has created an iconic “swoosh” logo that signifies high-quality athletic wear for athletes around the world. Consumers know they are buying Nike products because they see this logo on every product sold by the company. They trust it will provide quality service with each purchase because it has been tested and tried time and again. 

In this article, we will explore the reasons why businesses of all sizes need to trademark their names.

Purpose of a trademark

Avoiding confusion in the marketplace is at the heart of trademark law. The purpose of a trademark, therefore, is to reduce customer search costs by making it easy to identify who stands behind particular goods or services. Companies should consider trademarking the name of their business with the help of companies like CompareLegalForms.com that can help them identify whether or not the name they want to trademark is available in the local and global market. This can prevent businesses from having to change their name mid-stride.

A company’s primary goal is likely to increase sales and expand its customer base while maintaining a reliable product or service. Any interruption in the brand recognition between the consumer and the source of the product may impede growth. If consumers are unable to easily identify where they can purchase particular goods, then there is no way for companies to grow revenue. Companies should not be discouraged by the costs of trademarking because it will prolong future gains if done early enough in business development.

The benefits of registering a trademark

Companies that register trademarks benefit from legal protection against unauthorized use of their names by others; enhanced credibility; uniqueness; legal recourse against copycats; simplification of licensing issues; faster expansion into foreign markets; and a better chance of winning federal litigation.

A consumer should be able to recognize a brand based on its logo, colors, typography, etc., rather than having to research where each product comes from. People are often hesitant about buying new products that they have never heard of before because they don’t know if the product will provide value for money or if it may just be subpar quality. By being able to easily distinguish among different sources for similar types of products through trademarks, consumers can have peace of mind knowing that the product they are buying is of high quality and from a reputable source.

Types of trademarks

There are three different types of trademarks: word, design, and slogan.

• A word trademark is just that—a word or words used to identify a business. For example, Apple is a well-known company that creates all sorts of computer software and electronic devices including the iPod, iPad, and iPhone. The name “Apple” is represented by their logo, which includes an apple with a bite taken out of it. Therefore consumers will immediately recognize this product as being from Apple every time they see this icon on their products.

• Slogans are meant to be catchy phrases that are displayed on advertising material but do not always contain words or symbols. People know immediately what these slogans represent even though there may be no logo included in the advertisement. A well-known slogan is “Just do it” which is used by Nike.

• A design trademark includes a two- or three-dimensional image that is used to identify a product or service. The most recognizable example of this would be the Coca-Cola bottle. This trademark has been registered for over 125 years and is one of the most valuable in the world.

How to register a trademark

To register a trademark, you must apply with the United States Patent and Trademark Office (USPTO). The application will include your company’s name, the type of mark you are using, goods or services associated with the mark, and other identifying information about your company. You can use an online form like this one from the USPTO to make it easier.

The cost of a trademark application varies depending on which type of mark you are registering, your company’s location, and other factors. For example, the filing fee for a wordmark is $325, while the filing fee for a design mark is $975. 

There is no legal process that one must go through to trademark their business name. However, if any disputes arise from others using the same or similar name, then it will be up to a judge to decide who has the right to use that particular name. 

The advantage of having a federally registered trademark is that you will have nationwide protection against unauthorized use of your mark by others. You will also be able to use the ® symbol next to your trademark, which indicates that it is registered with the USPTO. 

Disadvantages of registering a trademark

The main disadvantage of registering a trademark is the cost. As mentioned earlier, the filing fee for a wordmark is $325, while the filing fee for a design mark is $975. If your company is located in a different country, then you will also have to pay an additional international application fee. 

Another disadvantage is that you may not be able to use your trademark in every country around the world. For example, if you want to expand your business into China, you will need to register your trademark with their government first. 

Finally, it can take up to 18 months for the USPTO to process and approve your trademark application. 

Benefits of registering a trademark

There are many benefits to registering a trademark, which is why all businesses need to do so. 

Some of the benefits include:

• Nationwide protection against unauthorized use of your mark by others
• Use of the ® symbol next to your trademark, which indicates that it is registered with the USPTO
• Ability to file a lawsuit against anyone who uses your trademark without permission
• Ability to license out your trademark to other businesses for a fee 

Trademarking the name of your business is an important step in protecting your brand and ensuring that consumers know where they can buy high-quality products from a reputable source. The cost of doing so may seem prohibitive at first, but the benefits far outweigh the disadvantages. For this reason, all businesses should consider trademarking their name.