New Balance has done some great work positioning itself as an aspirational, but affordable fashion brand in China. It’s hard to walk a block in China’s hipper urban suburbs without seeing young fashionistas sporting NB shoes. But for those sitting in the Boston HQ, that success would have been slightly tarnished by the recent ruling that New Balance’s Chinese brand name, XīnBǎiLún, was violating a Guangdong businessman’s trademark.
The ¥98 million ($16 million) fine and order to stop using the brand name is another stark reminder of the importance of trademarking in China. Last year, after failing to trademark its Chinese name, Australia’s rock star wine brand Penfolds found itself locked in a legal battle with a trademark squatter, which saw them lose sales of at least 5,000 cases a year and valuable exposure in premium IHG hotels. Even Pfizer was beaten to trademark the most commonly used Chinese name for its Viagra, “WěiGē”.
One of the more interesting examples of brand theft was from California’s In-N-Out Burger, who had no immediate plans to expand to China. Four California-educated law graduates trademarked the chain’s legendary menu items throughout Asia and Europe. Opening their restaurant Caliburger in Shanghai, they promised many of the well-known In-N-Out staples such as Double-Double, Animal Style, and Protein Style burgers and fries, and even an iteration of the iconic palm tree on their branding. Following a confidential settlement – rumoured to involve a significant sum of money – Caliburger changed their burger names and decor.
China has a “first to file” policy for trademarking, meaning little emphasis is placed on the rightful owner of a brand. The cost to trademark in China can be surprisingly inexpensive. Even foreign brands who are unsure if they will ever launch in China, should consider taking the simple steps to register their trademark here.
When China Skinny localises branding for a client, in addition to creating something that resonates and is relevant to the target market, we also ensure that the proposed trademark is available and filed before investing in the brand. In addition to brand trademarks, regional branding for food and beverage can be protected, and even shapes such as Toblerone’s triangle chocolate. Best get onto it if you haven’t already. Go to Page 2 to see this week’s China news and highlights.