Chapter 4: Trade Marks and the Organization of Economic Activity
1. TRADE MARKS AND ORGANIZATION 1.1 The Aims and Scope of this Chapter This chapter will examine the contribution of trade marks to the organization of economic activity and their inﬂuence on the development of organizational structures. The basis of this contribution and inﬂuence is the capacity of a trade mark to acquire marketing power in the various ways that Chapter 3 has examined. Ownership of a trade mark gives a ﬁrm exclusive control of a potentially valuable marketing resource, which it can use to market its products. A ﬁrm (or other undertaking) can use a trade mark to stimulate and strengthen the demand for its products, to market new versions or variations of its current products and to market different kinds of products. Chapter 3 has shown how ﬁrms can use trade marks to compete and strive for a competitive advantage in a number of different ways so that they are not restricted to competing through minimizing the sale price of their products and striving to minimize their costs.1 Trade marks enable ﬁrms to compete in terms of the quality and difference of their products, in terms of their conduct and other characteristics as organizations and through giving their products additional emotional and psychological appeal to consumers. Trade marks also enable ﬁrms to compete in terms of the quality of their trade marks as sources of reassurance and appeal to consumers. A legal institution that enables a ﬁrm to develop, deploy and exploit marketing power of this...
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