Chapter 19

Dealing with Competition and Other Threats to Your Brand

IN THIS CHAPTER

check Maintaining focus on the needs of your target market

check Keeping tabs on the competition

check Getting up to speed on trademark and patent protections

check Regaining your footing in the midst of negative publicity

Part of your responsibility as a brand owner is to protect it from threats, both external and internal — from competitors, intellectual-property thieves, and negative publicity (typically the result of carelessness or dissent within an organization). Your approach needs to be both proactive and reactive; you must take steps to prevent bad things from happening and be prepared to respond when they do happen.

In this chapter, I provide guidance on how to protect your brand against the most common and serious threats from within and without.

Remaining Sensitive to the Changing Needs of Your Target Market

The biggest threat to your brand is complacency. Many brands achieve some degree of success and decide to rest on their laurels, forgetting that the world and their customers’ needs and preferences are changing continuously. As their customers change, they remain fixed in what they do, allowing competitors to swoop in and gain market share at their expense. Imagine a clothing line that never changes. It’s still pushing skinny jeans when all its competitors have followed the trend toward wide-legged pants.

Here are a few ways to remain sensitive to changes in your target market:

  • Stay laser-focused on your customers’ needs and preferences. A brand’s success ultimately boils down to customer enthusiasm.
  • Listen closely to your customers. Sources for gaining insight into what customers want include the following:
    • Your sales team
    • Your customer service reps
    • Discussions on social media that mention your brand, a competitor’s brand, or the types of products or services you sell
    • Returns and exchanges
    • Surveys
  • Look for trouble. Every problem, pain point, and challenge your customers face is an opportunity for your brand to serve their needs.
  • Keep an eye on the competition while remaining proactive. You don’t want to merely react to what your competition is doing. By knowing what they’re up to, you have a better chance of outcompeting them in innovative ways.
  • Monitor market conditions. Buying habits shifted considerably starting in 2020 in response to the COVID-19 pandemic, for example. Keep an eye out for big changes in the world, and think about how any given change might affect your customers’ needs and preferences.

Remember Monitor any changes within your organization as well, and think about their impact on your brand. As your business grows, for example, it may gradually become less innovative and responsive, and focus more on the quality and reliability of existing products. If your brand identity is closely associated with innovation, you’ll need to find ways to reinvigorate that aspect of your business or rebrand it if you think that your customers’ evolving values make the change necessary.

Keeping the Competition at Bay

With branding, one thing’s for certain: When you achieve success, someone or something will come along and try to take it from you. They’ll mimic you, steal your idea, or do you one better. Chances are good that you’re doing the same with your brand — trying to unseat an established brand by offering something superior — and that’s okay (assuming that what you’re doing is legal and ethical). Competition drives development, makes stuff more affordable, and improves the lives of consumers. Unfortunately, it can also drive you and your brand out of business. What happened to Blockbuster, for example, can happen to you (see “Staying abreast of changes in your industry” later in this chapter).

To maintain your competitive edge and ensure that your brand continues to thrive, you must remain vigilant for anything that’s competing against it or threatening to replace it and respond quickly to any threats. In this section, I show you how.

Identifying your competition

Most brand owners can identify their competition, both direct and indirect:

  • Direct competition is another brand that competes in the same market with a nearly identical product. Starbucks, McDonald’s, and Dunkin’, for example, are all vying to become the go-to place for great coffee.
  • Indirect competition is another brand that competes in the same market with a substantially different product. Starbucks, for example, competes against several companies that sell premium teas, including Tazo and Twinings.

I have a broader interpretation of competition: Competition is anything else that someone in your target market can spend their money on. I have a fashion brand, so I’m obviously competing against other fashion brands, but my customers can choose to spend their money on all sorts of things — entertainment, travel, pets, gym membership, beauty supplies, home décor, you name it. I’m competing for every discretionary dollar my customers spend. To win their business, I need to give them a compelling reason to spend that dollar on my products instead of anything else they have a choice to spend it on. I recommend that you take the same approach.

Striving to go beyond quality and value

In today’s world, most products and services have become indistinguishable from their competition. If you’re focused solely on delivering the highest-quality product or service or the greatest value, you’ll likely end up working too hard while watching every penny be squeezed out of your profit margin. You need to deliver something else, such as a unique experience, a special feeling, or a sense of belonging. Branding is all about making people feel an emotional connection to what you’re offering — an emotional connection that your competitors can’t possibly offer.

Here are a few ways you can start to nurture an emotional connection to your brand:

  • Tell and share stories that evoke an emotional response.
  • Share your vulnerabilities. Reveal the human/emotional side of your brand.
  • Express a genuine interest in the lives of your customers. Be empathetic. Show that you care.
  • Engage and interact with customers authentically. Don’t be afraid to be you.
  • Connect with customers on their emotional level. Are they afraid, lonely, or insecure? If your brand can fill a void in their lives, it will create a deep and lasting bond.
  • Build a thriving community around your brand. Most people want to be part of something greater than themselves. By building a thriving community and offering membership to that community through your brand, you build and strengthen brand loyalty.
  • Rally your customers around a common cause. Nothing creates a stronger sense of community than a worthy cause.

Staying abreast of changes in your industry

Earlier in this chapter, in the section “Remaining Sensitive to the Changing Needs of Your Target Market,” I encourage you to keep an eye on the changing needs and preferences of your customers, as well as changes in your industry. Otherwise, you’re likely to get blindsided by new technologies, techniques, products, services, and other innovations.

Blockbuster is the poster child for brands that got blindsided by disruptive technologies. It was the leading video rental company in the world. Then, thanks to high-speed Internet and cable TV, streaming video became possible, making VHS and DVD rentals obsolete. Soon thereafter, Blockbuster locations across the country began to disappear.

Here are a few ways to stay abreast of changes in your industry:

  • Read your industry’s leading trade journals and newsletters regularly.
  • Network with other people in your industry, including any vendors you may use or businesses you sell to.
  • Visit your competitor’s websites and blogs to see what they’re up to.

  • Engage in discussion forums related to your industry.

    Remember Check LinkedIn for industry-specific discussion forums.

  • Join and participate in professional organizations related to your industry.
  • Set up Google news alerts to notify you of any news that’s relevant to your industry.

Focusing on innovation

One of the best ways to keep your competitors at bay is to outinnovate them — develop products, services, and practices they haven’t thought of. Some of the most innovative companies develop products and services before market demand for them exists. They deliver what consumers want before consumers even know they want it. Case in point is the smartphone. When IBM introduced the first smartphone — the Simon Personal Communicator — in 1994, it didn’t exactly fly off the shelves. Now most people can’t imagine living without one.

Innovation isn’t restricted to technology, however. It’s important in every sector — including transportation, agriculture, education, hospitality, fashion, and entertainment — and it encompasses everything from what’s made to how it’s made, marketed, distributed, sold, and supported. When most people think of the fast-food industry, for example, they don’t think innovation, but just consider how much has changed over the years, from drive-ins to drive-throughs, from paying with cash to paying with credit cards, and from ordering at the counter to ordering via apps and kiosks.

As you think about innovation, consider all aspects of your business, and always ask yourself this question: “What improvements can I make to enhance the customer experience?”

Protecting Your Brand

Before you introduce a new brand, product, or process to the market, take steps to protect it. If you haven’t done so already, now may not be too late. As long as someone else hasn’t trademarked the same brand or patented a very similar product or process, you still have time to protect your intellectual property — ideas that may have commercial value.

In this section, I bring you up to speed on the legal protections available and offer guidance on getting legal advice during the process and in the event that anyone infringes on your rights.

Registering your business with government agencies

The first step to protecting your business and brand is registering your business. If you conduct business under your own name and don’t have employees, you’re not necessarily required to register your business, but doing so is a good idea. Registration can help you qualify for personal liability protection, as well as legal and tax benefits, and it can facilitate the process of applying for a trademark or patent. On the other hand, if you’re operating under an assumed name or a fictitious name, you are required to register your business.

Registration requirements vary at the federal, state, and local levels and according to your business structure: sole proprietorship, limited liability company (LLC), S corporation (S corp), or C corporation (C corp). See Chapter 2 for details about different business structures and guidance for registering your business name.

Trademarking your brand

A trademark is any word, phrase, symbol, design, or combination of those four things that identifies your goods and services and distinguishes your brand from competing brands. It identifies the source of your goods or services, provides legal protection for your brand, and helps guard against counterfeiting and fraud.

Trademarks come in two flavors:

  • Trademark, which is used for goods
  • Service mark, which is used for services

For the purposes of this book, I use the term trademark to refer to both trademarks and service marks.

Remember The primary purpose of a trademark is to prevent unfair competition. A business might create a similar brand to cause confusion in the marketplace to the detriment of the trademark’s creator, for example. Or another business in an entirely different sector may use the same name as a name you trademarked, and you’d have little, if any, legal cause to file a trademark-infringement lawsuit against that business.

Tip I recommend hiring a law firm that specializes in registering trademarks to conduct the search for you. (For details on hiring a qualified attorney and getting help paying for one if you don’t have the money to cover the cost, visit https://www.uspto.gov/trademarks/basics/why-hire-private-trademark-attorney#Find%20attorney.)

Conducting a trademark search

The first step in trademarking your brand is conducting a trademark search to ensure that you’re not infringing on someone else’s trademark. Conducting a thorough trademark search is a complicated process requiring the following three types of searches:

  • Federal: A federal trademark search involves searching the U.S. Patent and Trademark Office (USPTO) database of registered trademarks, which you can access at https://www.uspto.gov/trademarks/search. You enter the name you want to trademark, and the search indicates whether the name is already registered.

    Warning Don’t limit your search to an exact match. Also search for similar names, names with the same meaning, foreign-language equivalents, and any anything else that may be similar. When a trademark registration application is denied, it’s usually because at least one variation of the trademark already exists, not because the name is identical to that of a registered trademark.

  • State: Every state has its own database of trademarks registered in that state. If you’re going to do business in only one state, you don’t need to search the databases of all 50 states, but if you ever expand nationally, you could become the target of a trademark-infringement lawsuit if someone registered an identical or similar trademark in any state. You can find links to state trademark databases at https://www.uspto.gov/trademarks/basics/state-trademark-information-links.
  • Common-law: Because a name, logo, or design is trademarked as soon as it’s used, and because people don’t always go to the trouble of registering their trademarks at the state or federal level, you also need to conduct a common-law trademark search. This process involves searching the web, newspaper and TV sources, trademark lawsuit databases, business directories such as The Real Yellow Pages (https://www.yellowpages.com), and public and private company records.

Now you know why I recommend hiring a law firm.

Establishing a common-law trademark

The easiest way to obtain trademark protection is to start using your brand name, logo, design, and anything else that’s unique to your brand. Assuming that nobody else is already using the same elements or very similar ones, you gain legal rights by being the first to use them. Use TM (trademark) or SM (service mark) in superscript next to your mark as a further indication that you’re claiming rights to it.

Assuming that you establish a common-law trademark, you should still proceed with registering the trademark, as discussed in the next section. Here’s why:

  • A common-law trademark is protected only where the trademark has been used.
  • A common-law trademark doesn’t provide legal protection as strong as that afforded by a registered trademark.
  • Without the rigorous vetting of the registered trademark registration process, you’re at greater risk of being legally liable for infringing on someone else’s trademark.

Obtaining a registered trademark

If you make it to this point, most of the hard work is behind you. Now you simply need to complete and submit the official forms. Which forms you use depend on whether you want protection just in the United States or in other countries as well:

As soon as you receive your registered trademark, but no sooner, you can and should begin using the registered trademark symbol (®) immediately and continuously in at least one prominent location on every product you’re your packaging and in every document and brand communication. Position the symbol in superscript to the right of your brand name, logo, or other unique mark. If you don’t use the mark, you’ll have a tough time claiming any damages for trademark violation.

Remember Use your trademark often, and defend it against any suspected trademark infringement. The more you use it, and the more vehemently you defend it in the court of law, the stronger it becomes. Also, be sure to file the required maintenance forms and pay the maintenance fees by the specified deadlines to prevent your registration from expiring or being canceled; visit https://www.uspto.gov/trademarks/basics/maintaining-registration for details.

Defending your trademarks

The USPTO doesn’t defend your trademarks for you. You need to remain vigilant of any infringement of or threats to your intellectual-property rights. Here are several actions to take to protect and defend your trademarks:

  • Use your registered trademark on your logo, press releases, business cards, packaging, website, and anything else in the public eye. Use it within six months of obtaining it, and use it continuously and extensively.
  • Maintain your registered trademarks by filing the renewal forms and paying the associated fees by the USPTO deadlines.

  • Remain vigilant, both online and off, for marks or products that are identical or similar to your marks. Be on the lookout for counterfeiting (a mark that’s identical to or nearly indistinguishable from yours), infringement (anything that’s similar enough to your mark to cause substantial confusion in the marketplace), dilution (anything that’s similar enough to your mark to reduce its distinctiveness), and mislabeling/false advertising (anything that misleads the consumer or end users in a way that causes confusion or damage to the trademark).

    Tip Check Trademark Official Gazette (https://www.uspto.gov/learning-and-resources/official-gazette/trademark-official-gazette-tmog), published every Tuesday, for new registered trademarks. The Gazette also includes a record of trademark renewals and cancellations.

  • Record your trademark with U.S. Customs and Border Protection (https://iprr.cbp.gov), which will enforce your mark at the borders, primarily for counterfeit goods. You’ll need to pay a fee, but it’s well worth the cost if you’re concerned about bad actors from foreign countries infringing on your rights.
  • Take legal action as soon as you suspect any infringement of your intellectual-property rights. The longer you wait to act, the weaker your position in court will be. If you suspect infringement of your rights, I encourage you to consult an attorney who specializes in that type of litigation.

Preventing and Recovering from Publicity Disasters

No business is immune from public relations (PR) disasters. Given the popularity and pervasiveness of social media, good or bad news can go viral in an instant.

As with any potential difficulty, prevention is best. Certainly, you can’t prevent everything bad from happening. A product defect, an angry customer or disgruntled employee, an environmental accident, or even an ad that offends a sensitive audience can damage your brand. But you can take a few proactive steps to prevent negative PR, such as the following:

  • Establish clear, firm policies and guidelines that govern anything anyone in your organization might say or do, during or outside work hours, that could reflect negatively on your brand. Include social media policies. (Many companies publish their policies or code of conduct online if you need examples to follow.)
  • Establish policies and procedures for securing and sharing customer data. A great deal of negative publicity these days arises from customer data falling into the wrong hands or being shared without express permission.
  • Monitor online news and discussions that mention your brand, and respond immediately to any negative comments or criticism.
  • Be vigilant for and address any workplace issues that could result in disgruntled employees going negative on your brand. Put a no-tolerance policy in place for sexual harassment, bigotry, and unethical business practices, and enforce it.
  • Put a system in place to handle grievances internally before they have a chance to spill over into public view.

If you experience a PR crisis, take the following steps to minimize the damage and begin to restore your brand’s positive reputation:

  1. Accept it.

    Acknowledge the problem. Don’t deny the problem, ignore it, or pretend that it doesn’t matter. If others perceive a situation to be a big problem, it is.

  2. Own it.

    Take responsibility, and show empathy to anyone who was harmed by what was done, said, or written. You’re the person in charge; the buck stops with you.

  3. Correct it.

    Take the necessary action to fix the problem and prevent it from happening again.

  4. Stay in front of it.

    Monitor discussions to remain on top of all the publicity, and respond quickly and appropriately, correcting any misinformation or misinterpretation.

  5. Be contrite.

    Even if you weren’t directly responsible for the problem, express remorse on behalf of your brand about what occurred.

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