Leveraging Branded IP For Growth

by Denis Tan, 06 Mar 2015
IPOS’s IP Consult Food & Manufacturing Seminar

Leveraging branded IP for growth

Companies that look towards export markets for growth commonly face the challenge of protecting their brands from counterfeits or passing-offs by local players. Considering the sizeable administrative and legal fees that go into IP protection, it is no wonder many brand owners are often daunted by the idea and simply enter a market without protection or forgo the expansion plans altogether. While protecting IP is not cheap, the cost of not doing so has been proven in reality to be in turn, many folds more. In fact, IP protection should be seen less as a defensive tool or expense and rather, a proactive approach that reaps returns when brands learn to leverage on their assets successfully as they internationalise.

Protecting what makes you successful

We know that brands are powerful assets. The Coca-Cola brand alone is worth about half the market value of its parent company. What constitutes this value? A brand, like a person, is recognised by its own distinctive and unique characteristics. These signatures could range from its name, visual marks, to packaging shapes, sounds or even slogans. Brand owners need to understand cues that their target consumers recognise or associate their brands with, in order to identify the critical elements that must be protected.

Take for example Glacéau Vitamin Water (owned by Coca-Cola), its bottle shape is a key point of recognition for many consumers in China. However, despite being first to market, the brand faced a tough battle against a local beverage player Nongfu Springs who went to market later with Victory Vitamin Water but with a patented bottle design. Such frustration faced by brand owners is particularly common in emerging markets where many local players aggressively monitor the actions of global brands and swiftly come up with offerings of uncanny likeness.

Developing brands with IP in mind from the get go

IP is not an afterthought. A brand’s development should begin IP in mind, starting by developing unique and distinctive elements to cue consumer recognition and preference. Our client’s case in point, when Kee Song Brothers, a leading poultry producer in Singapore and Malaysia, was ready to market its range of premium chickens reared using its own proprietary lactobacillus feed technology, we ensured various components of this new product could be trademarked including a new name Kee Song Carogold. This IP discipline instilled early into the brand development process has proved to be crucial for our client as they look set to expand their footprint regionally.

Even when a brand has successfully developed their IP, it is still important to continuously monitor and enforce its brand assets, leveraging them to propel growth. Ferrero Group is known for its rigorous IP strategy, owning more than 150 patent families, 2,000 designs and 11,312 trademarks registered in several countries worldwide. With such strong protection, the firm also monitors with a dedicated IP audit team and enforces consistently.

In essence, brands are valuable IP assets. Brands demand investment of resources put in place to develop, protect, monitor and enforce. We, together with our group of companies under the Louken Group, recognise the central role of IP in the development of your brands especially in expanding your regional footprint and we are ready to assist your company in your planned growth holistically.

Extracts of this article was taken from an original speech delivered by Denis Tan, Associate Director & FMCG Lead, AS Louken, at IPOS’s IP Consult Food & Manufacturing Seminar on 06 Mar 2015.