Showing posts with label Retail. Show all posts
Showing posts with label Retail. Show all posts

Friday, March 30, 2012

Trademark Squatting or Extortion?


You’ve probably heard stories of fake Apple stores in China. These stores completely copy the Apple store from the all-white decor to the blue shirt wearing salespeople. With all stories, I wonder: how can these storeowners get away with this? No store in United States could even get away with copying the blue shirt styles let alone the all white décor. However, “Trademark squatting in China doesn’t sit well with U.S. retailers” by David Pierson of LAtimes.com explains the fake Apple stores, along with the fake Kardashian, Justin Bieber, J. Crew, Jordan, and Eminem brands in the Chinese market.

The article reports, in China “trademarks generally are awarded to those who are first to register them with government authorities. If these and other U.S. companies want to use their own names, they probably will have to pay the Chinese holder for the rights”. In the U.S., trademarks are awarded to those that use them first. So, if an established U.S. brand tries to move into China and the name is trademarked, under Chinese law, the trademarked user could charge the U.S. brand to use their name. Example in article, “In northeastern Liaoning province, someone owns the trademark to make clothing under the Oprah Winfrey brand.”

The exception to the law is to prove that the trademark holder in China registered in bad faith. Although, Stan Abrams a law professor in Beijing is quoted saying “The system here on the whole is geared towards first to file, and it takes a lot of time and effort to rebut the presumption that the registrant filed in bad faith” Hermes International, Chivas Bros, and Pfizer Inc. have tried to file suits and have failed.  Apple and Michael Jordan are currently involved in suits against companies making revenue from their names.

Throughout the article, many of the trademark users in China gave no comment, with the exception of Xu Junwu and Zhen Yongyu. Xu Junwu owns the trademark for J. Crew. His “good faith” defense of using the brand name: “said he’s never heard of the U.S. clothing chain and explained that his sales team came up with the name”.  In his own words “They just picked something easy to remember without a lot of letters… we’ve put a lot of effort into building this brand, we’re recognized in China” The last part of that quote is his response to whether he would charge J. Crew to use their own name in China.

Zhen Yongyu owns the name Eminem and claims, “I’ve never heard of Eminem… If this Eminem turns out to be a famous singer, we’re willing to cooperate as a potential partner to release this brand in China. We’re also open to selling it.”

There’s no other word to describe this “trademark squatting” other than bull#hit. I apologize for the word but I truly honestly, in good faith, can’t think of any other word that truly embodies this entire scheme. Oprah, Eminem, Apple, Michael Jordan, and any other well established celebrities and brands will have to pay to use their own name/brand. In order to reclaim their brand, first will have to prove that the other person did it in bad faith. Explain to me how a “team” picking a name out of air and oops, it happened to be a well-established brand is a “good faith” defense.  I’m pretty sure that these trademark owners in China have access to some form of media that allows them to search names. Who hasn’t heard of Eminem, Oprah Winfrey, or Michael Jordan?

Most brands will likely seek legal action instead of paying for their name. Or they might ignore the market altogether. Last thought to consider: this might sound like a smart extortion plan for the trademark holder but doesn’t this scare U.S. retailers from entering the Chinese market?

Friday, December 23, 2011

Best Buy Can't Keep Up With the Holidays


Best Buy was not prepared for the holidays. Best Buy decided to give free shipping on all online holiday orders, with no minimum requirements. As expected, Best Buy got many customers. But, according to “Best Buy cancels some online orders” by Marisa Taylor of MSNBC.com, Best Buy can’t keep up with the demand of their own promotion. They have decided to cancel some orders. Best Buy released this statement:

“Due to overwhelming demand of hot product offerings on BestBuy.com during the November and December time period, we have encountered a situation that has affected redemption of some of our online orders. We are very sorry for the inconvenience this has caused and we have notified the affected customers”

Let that sink in for a moment. Some Best Buy customers may have recently been informed that the holiday present(s) they purchased has been canceled. The purpose of purchasing products days to months before the holidays is to avoid last minute shopping. Best Buy not only is causing inconveniences but essentially pushing customers away.

Best Buy should have a research and inventory department that advised the company that they couldn’t live up to the promotion. All in all, the free shipping promotion means little if they lose customers and gain bad publicity. 

Tuesday, June 21, 2011

Is Best Buy a Trademark Bully?


It seems Best Buy believes they own the rights to the word “geek”. According to “Now That Everyone Wants to Be a Geek, Lawyers Have Been Called” by Miguel Bustillo of WSJ.com, Best Buy has sought legal actions against many businesses who use any aspect of the “geek squad” brand including the car, the colors, and/or the name. Best Buy inadvertently gave attention to their legal fiasco when they attempted to stop Newegg.com’s recent advertisement.

According to the article, Newegg’s current commercial takes a not-so-subtle shot at competitor Best Buy:

“The spot, which aired on cable television and the Web, shows a clueless blue-shirted store salesman stammering and shrugging when a customer asks him to explain the difference between two laptops. It then touts Newegg as a website where shoppers can read reviews from fellow customers who actually know what they are talking about, and flashes the slogan, 'Take it from a Geek'."

Wednesday, June 15, 2011

J.C. Penney Hires Apple Exec as Its CEO


JcPenney Co Inc is hoping for a massive retail makeover. The architect of this makeover will be Ron Johnson, senior vice president of retail of Apple. In November he will be J.C. Penney’s new CEO, replacing Myron Ullman. According to “Penney Snags Apple Retail Executive as Next CEO” by Phil Wahba and Poornima Gupta of Reuters.com, the news was great for the stock – “Penney’s market value rose more than $1 billion on the announcement, with its shares adding $5.26, or 17.5 percent, to close at $35.37.”

J.C. Penney has been trying to get Johnson for some time. The largest shareholders of the company wanted to bring Johnson on as an executive years ago. The allure is that Johnson is really dedicated to retail and its consumer and previously worked at Target before working at Apple.  Under Johnson, “Apple opened its first retail outlet in May 2001” and, as most of you know, the Apple store is incredible. It has a great décor and is recognizable and significant to its overall brand.  A former Apple executive had this to say about Johnson:

“From day one, and ever since, I have never heard Ron refer to somebody coming into the store as anything other than a guest… When you hear him talk, you feel like you are talking to somebody who was running a Four Seasons hotel as opposed to somebody who was running retail.”

The article reports J.C. Penney’s goals are to integrate technology into the retail space, reach out to different demographics, and become known as a trendy “budget conscious” store.  Johnson’s appointment will hopefully remake and rebrand J.C. Penney and in the meantime Apple is looking for his replacement.