Peter Drucker, the father of business consulting had once shared that for all business, marketing and innovation produce results; all the rest are costs. This is a profound observation. Both are needed to engage, service and grow customers. Marketing is to distinguish the unique functions of a business. Innovation is to create these functions. Intellectual Property (IP) is innovation and can be utilized as marketing strategy too.
There is a myth that IP can only help large firms and it is difficult for small medium enterprises (SMEs) to leverage. Here we would want to shed lights on how to use IP as a marketing approach to create new revenue streams. Below are the 3 ways.
1. Positioning for company
Intellectual property makes SMEs more valuable for acquisition. This is especially so if the company had IP (for example patents, market access) that are of value to bigger companies. An example is Siltbuster Limited in UK. With their patents, they were awarded the Queen’s Award for Enterprise. They become a valuable acquisition party and eventually bought over by Workdry International. For start-ups, announcement and publicity surrounding patent grants, market penetration can help them to gain greater opportunities to secure Venture Capital (VC) funding.
For some companies, they create valuable IP assets that help to demonstrate market potential. In the past, we have Henry Ford creating the gas-powered automobile that replace horse as a means of transport. In the 21st century, Apple creates user-friendly touchscreen smartphones. It had proven indeed there is great market demand by consumers for such phones. As result, Apple’s company value sky-rocketed. The iconic tagline “Think Different” is great marketing and branding slogan for Apple products, forming a large follower tribe.
2. Consumer engagement
Photo – Unsplash Rostislav budzan
Protecting IP can also be proactive. Brand protection is a forward-looking strategy that any companies can adopt for their products. The aim is to engage consumers by allowing them to identify and buy your genuine products. In the past, companies would consider it is a cost to implement solutions on their products to prevent counterfeit. However, with presence of smart phones and technological progress, brand protection can now be smarter. Anti-counterfeiting, tracking of distribution channels and marketing engagement are some benefits.
Security features such as encrypted QR code with branded logo hologram provides attractive physical appearance and unique digital identity for each product. The combination of physical and digital technologies allows brand owners to better serve consumers. Consumers are able to get information of their purchase and verify genuine products using their smartphones. The offline and online engagement makes marketing holistic and effective. Product authentication, information sharing and loyalty program can be implemented.
With unique digital identity (like a birth certificate number) added for each product, brand owner can also track their products to prevent illicit grey market affecting their distribution channels.
3. Partnership and licensing
Partnership and collaboration are essential parts for business growth. IP such as Trademark, Design, Copyrights can be formable marketing tools. As a brand grow stronger, by registering trademark, the company can lock in the brand recognition value. Valuable goodwill in its name provides a visible sign of ownership and help to attract partners.
Furthermore, firms can also license their brand name to others for branding of products and services. In some cases, the brand can even be used in a totally different industry. A good example is Michelin. Michelin is a tyre manufacturer brand; however, it is also a well-known rating guide for delicious food restaurant.
Licensing your brand means giving another company permission to use your logo, name, or other intellectual property on their products. We do not need to be a big brand to make licensing happen. So long as your brand has value, even for a niche, you can still license out. With licensing, your brand awareness grows in different markets. More consumers get to know your brand. Royalty revenues and license sales will help to bring further monetary returns and growth for the company.
IP protection - The marketing approach that you may have been missing out
IP protection is a valuable asset in its own right beyond the underlying product or service it protects. It can become an organization most valuable asset with the correct strategy and supporting solutions. Protecting IP with the intention to enforce its rights when they are infringed is not realizing the full potential. A conscientious effort to allow easy verification of products help to build trust with consumers and increase brand value. IP protection should not be reactive. For some organizations, the responsibility to handle and utilize IP comes under the purview of the brand owner, legal or brand protection team. However, IP involves everyone from the CEO to operational executives to the distributors. For smaller firms, the managing director or managers can accelerate company growth by locking in the value of their IP through a marketing lens. Executives will need to look beyond the immediate applications of their innovation. A focus on being proactive to leverage on IP to build on marketing is a synergy. This simple approach help to enhance brand value, bring numerous opportunities and drive the company to greater heights.
Learn more about how IP can be a key driver for smarter business – HERE.