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Trademarks As an Indicator of Product and Marketing Innovations Unclassified DSTI/DOC(2009)6 Organisation de Coopération et de Développement Économiques Organisation for Economic Co-operation and Development 08-Apr-2009 ___________________________________________________________________________________________ English - Or. English DIRECTORATE FOR SCIENCE, TECHNOLOGY AND INDUSTRY Unclassified DSTI/DOC(2009)6 TRADEMARKS AS AN INDICATOR OF PRODUCT AND MARKETING INNOVATIONS STI WORKING PAPER 2009/6 Statistical Analysis of Science, Technology and Industry Valentine Millot (OECD) English - Or. English JT03262734 Document complet disponible sur OLIS dans son format d'origine Complete document available on OLIS in its original format DSTI/DOC(2009)6 STI Working Paper Series The Working Paper series of the OECD Directorate for Science, Technology and Industry is designed to make available to a wider readership selected studies prepared by staff in the Directorate or by outside consultants working on OECD projects. The papers included in the series cover a broad range of issues, of both a technical and policy-analytical nature, in the areas of work of the DSTI. The Working Papers are generally available only in their original language – English or French – with a summary in the other. Comments on the papers are invited, and should be sent to the Directorate for Science, Technology and Industry, OECD, 2 rue André-Pascal, 75775 Paris Cedex 16, France. The opinions expressed in these papers are the sole responsibility of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries. http://www.oecd.org/sti/working-papers OECD/OCDE, 2009 Applications for permission to reproduce or translate all or part of this material should be made to: OECD Publications, 2 rue André-Pascal, 75775 Paris, Cedex 16, France; e-mail: [email protected] 2 DSTI/DOC(2009)6 TRADEMARKS AS AN INDICATOR OF PRODUCT AND MARKETING INNOVATIONS Valentine Millot (OECD) ABSTRACT Non-technological innovation is a major factor of competitiveness and productivity growth in the economy, notably in the service industries. However, the measurement of non-technological innovation and of innovation in the service industries is currently very poor, as traditional data sources like R&D or patents do not apply to these types of innovations. This document presents a strong candidate for quantifying non-technological innovation: trademark data. Trademarks constitute a rich and easily accessible source of data. Besides, several studies have shown that they are highly correlated with various innovation variables (patents, share of innovative sales). Lastly, trademarks have a large perimeter of application; they are present in almost every sector of the economy. Trademark data are then likely to convey information on two key (overlapping) aspects of innovation that are not well covered by traditional indicators: innovation in the service sectors and marketing innovation. This paper aims at presenting trademarks, their potential link with innovations and their main statistical properties, to see if they may actually serve as an innovation indicator. 3 DSTI/DOC(2009)6 LES MARQUES COMME INDICATEUR D’INNOVATIONS DE PRODUIT ET DE COMMERCIALISATION Valentine Millot (OCDE) RÉSUMÉ L’innovation non technologique est un facteur majeur de croissance et de compétitivité, notamment dans les industries de services. Néanmoins, la mesure de l’innovation non technologique et de l’innovation dans les services est à l’heure actuelle très insuffisante, les indicateurs traditionnels tels que les dépenses de R&D ou les brevets ne s’appliquant pas à ce type d’innovation. Ce document présente un candidat de poids pour quantifier l’innovation non-technologique: les données de marques. Les marques constituent une source de données riche et facilement accessible. Par ailleurs, plusieurs études ont montré une forte corrélation entre les marques et différentes variables d’innovation (brevets, part de ventes liées à l’activité innovante). De plus, le périmètre d’application des marques est très étendu, elles sont présentes presque dans tous les secteurs de l’économie. Les marques sont ainsi susceptibles de fournir de l’information sur deux aspects importants de l’innovation (se superposant en partie) que les indicateurs traditionnels couvrent mal: les innovations dans les services et les innovations de commercialisation. Ce document vise à présenter les marques, leur lien potentiel avec l’innovation et leurs principales propriétés statistiques, de manière à déterminer si elles peuvent effectivement servir d’indicateur d’innovation. 4 DSTI/DOC(2009)6 TABLE OF CONTENTS INTRODUCTION .......................................................................................................................................... 6 1. DEFINITION AND LEGAL ASPECTS OF TRADEMARKS ................................................................. 9 1.1 Defining trademarks .............................................................................................................................. 9 1.2 Rights and duties associated to trademarks ........................................................................................... 9 1.3 Trademark systems and procedures .................................................................................................... 11 2. TRADEMARKS AND INNOVATION: LITERATURE REVIEW ........................................................ 12 2.1 The use of branding in the launching of new products ....................................................................... 12 2.2 Brands as barriers to entry ................................................................................................................... 13 2.3 Branding and marketing innovations .................................................................................................. 14 2.4 Statistical studies on trademarks ......................................................................................................... 15 3. TRADEMARK DATA AS AN INNOVATION INDICATOR: PRELIMINARY STATISTICS AND METHODOLOGICAL ISSUES ................................................................................................................... 18 3.1 General trends in trademark activity world wide ................................................................................ 18 3.2 Repartition of trademark activity across sectors ................................................................................. 22 3.3 The issue of non-used trademarks ....................................................................................................... 27 3.4 Home bias in trademark applications .................................................................................................. 30 CONCLUSION ............................................................................................................................................. 34 BIBLIOGRAPHY ......................................................................................................................................... 35 APPENDICES .............................................................................................................................................. 37 5 DSTI/DOC(2009)6 INTRODUCTION As defined by law, a trademark is a sign (a word, a logo, a phrase, etc.) that enables people to distinguish the goods or services of one party from those of another. Trademarks constitute one of the most important assets of firms. It is mostly through them that people know the firms and that the firms’ reputation can be built. They enable the consumers to differentiate between competitive offerings and possibly to develop loyalty towards one preferred trademark. This loyalty relationship enables the firm to charge higher prices and maintain higher margins1. Thus, trademarks play a key role in the activity of firms. According to R. Elliott and L. Percy [2006], a strong brand name is an essential factor in a company’s financial success. However, despite their great importance in economic life, trademarks have been relatively neglected in the economic literature (unlike in the business literature), and trademark data are not often used in economic analyses. It is yet assumable that they could provide some interesting information on various aspects of firms’ activity. It can be notably expected that trademarks could bring information on innovative activity (Schmoch, 2003; Mendonça et al., 2004; Malmberg, 2005). The only criterion to register a new trademark is the novelty of the sign itself, which must not be similar to any already registered trademark. The purpose is that the mark uniquely identifies a type of product, so as to prevent consumers’ confusion. Contrary to patents, the registration of a trademark does not require the novelty of the product itself. At the legal level, the link between trademarks and innovation is consequently not straightforward. In practice, however, trademarks are likely to be linked to the innovative activity of firms, at various levels. First, trademarks play a role in the commercialisation of new products. When they launch an innovation, firms may associate it to a new brand in order to help the perception of the innovation by consumers. The brand constitutes a basis on which firms advertise their product. Then the trademark has good chances to become a, or even the reference on the market for the product. Indeed the consumers who start buying one innovative product of one brand are likely to remain loyal to this brand. It is then
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