Why do companies register so many different brands?

With no limit to the number of brands registrable by one entity, many companies choose to register a variety of different brands. Indeed, you may not be aware, but the majority of household-name trademarks are owned by only a dozen multinational corporations. This begs the question: why do these companies register so many different brands?

Take the Dutch-British company Unilever, for example. You might be surprised to know that a variety of seemingly different brands are all owned by this one corporation. Ranging from foods to household cleaning products to toiletries, some of its famous brands include Magnum ice creams, Persil and Dove. Without prior knowledge of this fact, you would be forgiven for believing that these brands were owned by companies existing in entirely separate market sectors.

What are the benefits of registering competing brands under the same company?

This phenomenon is not exclusive to large multinational corporations such as Unilever, as smaller businesses also register many different brands.

The reasons that companies may wish to register a variety of different brands can be manifold, but there are some key factors weighing in the decision, all of which primarily concern the company’s ability to maximise market presence in some form.

• Branching into other sectors

As is evidenced by the Unilever example, some companies choose to register a multitude of different brands in different market sectors. One rationale for this may be that the company is then able to establish roots across a range of markets, thereby increasing overall market presence.

Registering different brands in different sectors also creates new opportunities for a business to expand, which can in turn prove both financially and strategically beneficial.

• Be their own competition

Companies may also register a variety of different brands so as to eradicate as much competition as possible. Companies register different brands in direct competition with each other within the same sector so that, regardless of consumer preferences and choices, the company will always be receiving their custom, whatever product they choose.

By registering different brands which are in direct competition with each other, a company does its utmost to try to ensure that it receives as much business as possible by filling the market with its own brands.

For example, Unilever has registered both the Flora and Bertolli brands for cooking butters and oils. Ownership of both brands results in maximum sales for the company, as consumers who may be looking to sample a new brand of cooking oil are more likely to buy another Unilever brand simply by sheer probability. The more brands a company owns, the greater the chance of consumers buying them.

• National variations

Another rationale for registering multiple different brands could lie in the national variations of pre-existing brands. For example, with Unilever’s Magnum brand, a variety of Magnum brands are registered by the company in different territories. As well as an EU registration for its Magnum brand, the company has also registered certain variations of the brand in specific territories, including the UK and Turkey.

Registrations of variations on the same brand are again used to increase the company’s market presence internationally, as well as providing the opportunity to tailor a specific brand to certain territories.

• Hedging their bets?

Companies may also be registering a variety of different brands in order to maximise their profit potential. With IP embodying such an invaluable asset to businesses, it is understandable that companies may wish to register as much as possible to maximise their chances of achieving success with some of their registered brands.

Effectively, companies register so many different brands to hedge their bets – they are aware that only a portion of their endeavours will be successful, and, therefore, the more brands they register, the more likely they are to achieve success.

Given the costs involved in actually registering a brand, it is worthwhile for a successful company to try to register multiple brands, as the potential profits of a successful brand will far outweigh the costs associated with registering the less popular and potential failures of brands.

Looking to discover more brand development and market expansion best practices? Download our white paper 'Growing through IP: A practical IP guide for international growth' or contact our team.