Is Intellectual Property Important toMarketing?

Intellectual property, or "IP," is a legal concept that references ownership of the output of creative

invention. It's also central to the foundations of brand and marketing strategy, so it's important for

marketers to understand why, how and when it's important.

IP Contributes to Brands

While the are may forms of IP, they fall into two broad categories: First, those that have specific legal

status, such as patents and copyright, and, second, IP that is has no specific legal definition, such as

brand and reputation, but still factor into business strategy and calculations of value.

Many of the artifacts of branding fall into that first category and can be legally protected, such as brand

names and logos. This is important because it precludes competitors from mimicking a business in

order to steal its customers (not to mention its hard-won accomplishments), if not to simply confuse

consumers. It also allows businesses to accrue value in those elements — the ability to sell cars

under the GM brand vs, say, Joe's Cars — just as it allows customers to track the performance

of brands over time. But a brand itself isn't property, insomuch that marketers can't "own" the varied

inputs to brand definition, nor can they own the conclusions that consumers make thereupon (it's the

outcome of ongoing experience). This complicates assessments of brand value. It's important to

recognize this fact, so as to not overstate those valuations.

IP Contributes to Differentiation

The idea of inventing "a better mousetrap" speaks to the challenge that every business faces: No

matter how creative or compelling its marketing might be, the ultimate (if not inescapable) truth of its

product or service offering is that it must be functionally different than its competition. It's the job of

communicators to package and present these differences in ways that are meaningful to customers,

but those efforts are enabled or hindered by the underlying differences from which they work. If a

product, or components of it, can be patented or protected by other means, it can provide a hint to

what might be useful in proving differences in marketing. Claims of uniqueness are far more powerful

and convincing if they're truly unique. Marketers don't require such legal affirmation of differentiation,

but it certainly helps.

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IP Contributes to Customer Experience

When customers can get content only from one source — from broadly educational information,

to specific user how-to — it can improve and support their experiences, which moves them to

assign unique value to that source. So the concept of copyright can be very important to marketers,

because it allows them to offer that content (and precludes competitors from simply copying it or, at

least technically, others from sharing it freely). Enforcement is somewhat dicey on this front, but

marketing that can claim some sort of exclusivity is going to make a contribution to customer

experience, even if only impermanently. Like the other artifacts of IP, however, marketers shouldn't rely

on content that is protected. The best "protection" is to create compelling customer experiences that

drive loyalty. Such engagement may not offer legal protections, but the commitment of satisfied

customers is worth more, arguably.

IP Contributes to Reputation

This is perhaps the most rich aspect of understanding IP and its relationship with marketing.

Corporate reputation, unlike branding, is the expectation of stakeholders (customers, shareholders,

suppliers, employees, lenders, etc.) of future company performance based on their understanding and

approval of past performance correlated with present-tense results. Intellectual property doesn't

appear directly in such assessments — unless a lawsuit concerning some patent or copyright

factors into recent news — but it is reflected in a variety of other numbers. For instance, the IP

of smart, successful supply chain management can be reflected in more reliable production, better

vendor pricing, and even greater sustainability over time. Similarly, the IP of corporate governance can

be reflected in a company's ability to predict and subsequently manage crises, as well as identify the

best avenues for corporate growth and profits. None of this IP can be protected, or covered wholly by

legal provisions, but organizational processes "belong" to a business and inform its operational

results. Brands are a great tool for communicating product or service benefits, but corporate

reputation, not branding, is therefore the ultimate IP.

Marketers should take into consideration these various impacts and influences of intellectual property,

but shouldn't base their strategies or tactics solely on the legal definitions of product, service or

process. Knowing what is objectively unique, as defined by legal or regulatory construct, can make

marketing communications better and more focused, but the real intellectual value of any given

business is embedded in the quality of its relationships with customers and other stakeholders.