Pro-active Vs. Reactive

In lieu of ever increasing range of threats, Brands can never be prepared for every possible circumstance. Proactive monitoring and enforcement can reduce the risk associated with trademark infringement extremely quickly and effectively. There is no such thing as being too prepared. Proactive business strategies involve advanced action taken due to opportunities or pending threats. Reactive strategies include approaches to respond after external factors or triggers affect your company. Planning for both types of strategy is important to near-term and long-term business success.

 

Counterfeiting, piracy, brandjacking etc. are known threats which occur in both mature and emerging markets on a global scale. While obtaining a significant portfolio of trademarks and patents well in advance of commercial use is essential, it requires aggressive monitoring and proactive measures to prevent IP misuse and infringement.  

 

Enterprises must be aware of the fact that risk cannot be completely eliminated and must be tolerated. Liaising with the correct authorities is an effective step in the right direction when it comes to protection, and this should now include social media sites, online marketplaces & many more fronts that a brand is exposed to. Proactive risk refers to an organization identifying the possible risks to their brand prior to it actually happening. This allows for the organization to have a contingency plan in place and be prepared if a risk was to occur. The alternative and more risky approach is reactive risk. This involves an organization dealing with the risk once it has occurred.

 

Treating protection of the brand as part of the overall intellectual property protection program most likely will involve integration into the business culture of processes and controls to protect the brand from product conception through development, manufacturing and distribution. Treating protection of the brand as part of the overall intellectual property protection program requires a different level of organizational commitment than strictly relying on one where the primary efforts are reactive.

 

The cost of inaction is often perceived as low. Since most companies don’t quantify the cost of a potential liability or the opportunity cost associated with lost sales, they tend to ignore it altogether. This is probably because return on investment (ROI) calculations can be difficult. For example, how does a brand calculate liability estimates when the liability constraints are not clear? How does an organization estimate revenue loss due to counterfeits when it doesn’t know the scope of the problem?

 

Companies may consider brand protection as an added cost of doing business rather than as an investment to maximize profitability (or minimize revenue loss). While on the surface it may seem to be merely a different way of looking at the same cost, in reality it is a major organizational shift. When a company thinks of brand protection in the same category as marketing, it has truly made the leap forward from being reactive to proactive about their security. As one would imagine, a reactive approach often leads to an ineffective and rudimentary system, while a proactive approach sets the stage for a world class system. Brand protection experts have to take a mixed strategy to successfully compete in the short-term and create sustainability for the long term.

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