Start-ups in Canada: How a good trademark strategy can protect and scale your business

If you’re a start-up or brand owner, you may be particularly proud of your new logo that took you hours to create, or you may be excited about the unique design you created for your new brand. You may also be worried about how you can protect your branding from your competitors and leverage trademarks to scale and grow your brand. Here is how a good trademark strategy can help. 

In this article, we will outline how trademarks can support your business in Canada and ensure that you are protecting your unique, valuable brand assets from being used without your consent. 

Trademarks overview

Firstly, how can a trademark help your business? Trademarks serve to build trust and confidence with customers and assure them they are getting a quality product or service from a particular business. Any sign, symbol or other unique identifier a business uses to distinguish its goods and services from other businesses can be protected. In Canada these can include:

• Brand names
• Logos
• Slogans
• Colours
• Smells
• 3D Shapes (or product packaging)
• Sounds

Merely obtaining a corporate name or registering a business name that is different from your corporate name, does not protect your brand or give you exclusive “trademark” rights to your name. 

Having a trademark registered in Canada and elsewhere can provide protection and substantial benefits, some of which include:

• Exclusive Rights. Obtaining exclusive rights to use the trademark across Canada, with the goods and services covered by your registration, even in provinces or cities in which you have never used the trademark. If you apply for international rights, you can extend protection to countries around the world.
• Deterring Copycats. Making it easier to deter or prevent others from using an identical or confusingly similar trademark, or to sue them for having sold their product or service using your trademark or a similar trademark.
• Increasing the Value of your Business. Being able to provide assurance to prospective licensees, franchisees, investors and future buyers that you actually have the exclusive rights to your trademarks, creates value and confidence.

Trademarks strategy

Once you have established which brand assets you can trademark, it is important to consider a few things. 

1. Which trademarks should I protect and why? 

Before applying for registration, you should assess the strength of your trademark and identify whether it is truly unique and distinctive. If the name is too generic or clearly descriptive in connection with the associated goods/services you offer (e.g., using ‘apple’ as a trademark for actual apples or apple juice as opposed to computers, or using ‘sweet’ as a trademark for candy related goods), it may be ineligible for registration. 

In addition, it would likely be extremely costly, and time consuming to protect and enforce every word, design, or idea that your business has, particularly as a startup. Therefore, it is important to identify which trademarks are most important and will be most valuable and unique to your business. This is typically the name of the company and logo, or a unique name of a flagship product or service.

A strong trademark can be a valuable business asset and can help potential customers identify your business and product or service, in a crowded market. Some examples of distinctive and popular trademarks in Canada that are unique and identifiable to their businesses include ‘Lululemon’ and ‘Shopify’.

2. Conduct a trademark search early on 

Conducting a trademark search early in your businesses journey will help ensure that the name or logo you wish to use and register as a trademark is not already being used (or registered) by another business in a similar field, so that you  avoid the sunk costs of having to rebrand and redesign packaging and marketing materials or advertising.   

As you will likely have a website, it is also a good idea to undertake a trademark search to be confident that you are investing in a domain name (and social media handles) that you should be able to use with manageable risks.

There are various types of searches you can conduct, ranging from:

• “Knock-out” or “Direct Hit” searches
• Register only searches (for identical and potential confusingly similar marks on the Trademarks Register)
• Register and marketplace searches (including searches of business name registries, domain names, and various online sources, in addition to the Trademarks Register)

These can all help you to identify and address any obstacles and assess and manage any potential risks in advance of investing in building your brand through marketing and advertising, for example.

An experienced trademark lawyer or agent can conduct a thorough trademark search and help you navigate through the potential obstacles to registration and risks of infringing the trademarks of other businesses.

3. Tips for filing a trademark

Once you have identified which trademarks you would like to file, it is important to ensure that your Canadian trademark application is completed correctly. These tips are helpful for new businesses and start-ups to consider for their first trademark application.

• Name first: Filing a name without any design elements as a “word mark” or “standard characters mark” generally provides you with the broadest scope of trademark rights that includes the exclusive right to use the trademark with any font style and any combination of lower case and upper case.
• Logo use: Once you have finalized and registered a logo as a trademark, ensure that you consistently use that version and avoid deviating too much from the original design to avoid rendering the registration for the logo vulnerable to cancellation for non-use, though it is common for businesses to rebrand or revise their logo, in which case a new application for that revised logo should be filed.
• Colour: Generally, in Canada we suggest filing design marks in black and white  to avoid limiting the scope of protection to any particular colour scheme. However, in some cases, filing in colour can be advisible, for example if you intend to use colour consistently. 

While we hope you find this article informative, it should not be considered or relied on as advice.  If you have any questions about trademarks in Canada, you can reach out to our team.