Intellectual Property theft has long been a challenge for brands in China. From luxury bags, to medical devices, to lipstick, to fruit, no category is immune to design, tech or branding ripoffs in China. In many cases, when your brand or product is being faked, it is a sign that you’re in demand with Chinese consumers and you’re doing something right. But brands shouldn’t wait until they are trending on Weibo, or are a top-seller on Tmall to protect their IP, it should be the first step in their China journey, or something they do even if they are unsure that they will ever enter China.
The good news is that IP protection is improving in China. It remains far from perfect, but it is far cry from the days when every village and town had its own bogus version of KFC, a massive sportswear brand could flourish as a blatant rip-off of Michael Jordan, Egypt and China were reaching diplomatic crisis point over a phony Sphinx and even kids were subjected to fake lions at the zoo.
While the US and European governments have been pressuring Beijing to increase IP protection, much of the impetus has been driven by Chinese businesses themselves. Chinese brands have increasingly become targets for fakers. Many are spending large sums on R&D and marketing to create desirable innovations and brands that become targets for counterfeiters. Last month, China laid out new guidelines designed to better protect IP. As we’ve seen in tech, education, culture and a host of other areas lately, Beijing means business when it issues guidelines.
One of the big changes in the guidelines are the heftier penalties that counterfeiters will face. This is coupled with increasing cases ruling in favour of brands who have had their IP stolen. One of the positive changes we’ve noted over the past few years is the increasing likelihood of brands winning their trademarks back from squatters, even if they weren’t first to file. The main justification for this has been the non-use clause. China’s widespread online adoption provides many tools to monitor and make cases about IP theft now.
There are a number of hygiene IP protection boxes to tick for brands selling in China. Many readers are likely to have them covered, but there are still numerous brands in China who still don’t have a Chinese brand name, for example. Beyond the basics, there are a number of initiatives brands can take to lay the groundwork for protecting less-traditional marks such as colours, sounds, holograms, shapes and slogans which will become more important to protect as China’s systems mature.
China Skinny works with trusted legal partners to develop and safeguard branding in China. However, our brand protection strategies go beyond trademarking and patents. Every touch point in the customer journey – until long after the good or service is sold – is an opportunity to reinforce your brand value, or a chance to squander it. Even choosing the right brand ambassador is vital, as Rolls Royce has recently found out.
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