Marketers and strategists are finding many ways to advertise and propagate their brand to increase the value of their brand and keep the numbers effervescent. New techniques ought to be devised to ensure the presence of brands in the market is salient and brimming with an influx of consumers. One such manner devised to benefit mutually from a partnership is a way of co-branding or ingredient branding by finding a mid-point and urging the customers of the counterpart to engage with one’s brand. Let us put this on a scale and see where this technique would stand.
Although a great marketing technique, co-branding is fused with the concept of cross-licensing of trademarks of different entities. The entities forge their trademarks to bring about a new product to attract consumer interest, which, in turn, increases sales.
There are many famous examples of co-branding where entities have come together. A few of those are as follows:
The Indian traditional-wear giant, Sabyasachi, also paired with H&M running the store dry in minutes. Then Taco Bell co-branded with Frito-Lay to popularize ‘Doritos Locos,’ a new product only made available at Taco Bell restaurants.
The downside of using two different trademarks on a single object could be summarized as follows:
Breaking Down the Structure of a Trademark Licensing Agreement for Co-Branding
A co-branding agreement should be meticulously designed to the benefit of both parties. The cross-licensing of trademarks must be able to rely on the existing Intellectual Property (IP) assets of each of the parties to introduce a co-branded product in the market with a risk management system intact or a strategic route map to enforce collective rights against potential infringers.
The draft agreement should unambiguously address the understated facts:
Conclusion
The negotiation stage is the most crucial aspect of a trademark licensing agreement while considering co-branding since each party contributes to the introduction of the product in the market; however, the degrees of participation and contribution may vary. Therefore, due to the unpredictable and dispute-likely magnetism, it is necessary to place a term sheet before entering into a licensing agreement of such sort to understand clearly where each party stands, specifically in terms of common concerns, such as channels of trade, advertising strategies, termination, royalties, etc.
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