Use Intellectual Property to boost rum’s profits, profile, says IP expert

Noted intellectual property expertDr Erica Smith has urged rum producers to use IP to strengthen their business model in order to stand out from the competition while learning from what consumers are saying about their competitors.

This advice was served up on Wednesday as several local and regional representatives of rum manufacturing companies took part in a West Indies Rum and Spirit Producers’ Association Inc. (WIRSPA) webinar.

Dr Smith, head of IP firm Intellectual Management Services Inc,said there was “a close nexus between IP and marketing from a strategic perspective”.

“This centres around the concept of differentiation. So in your marketing strategy, you are seeking to differentiate your products and services in the market and IP is used to make exclusive these unique aspects of your products and services that allow for the differentiation. So the two are closely linked based on the desire to achieve differentiation,” she explained.

Integrating IP into the marketing strategy would allow for “an expansion of markets, maintenance of market share and to facilitate the creation of new markets”, she said.

Dr Smith, who completed her most recent studies in intellectual property, management and strategies, said too often businesses “go about doing what they do and then the IP registration or implications are treated as an afterthought”.

“Another mistake that is often made is that a lot of people assume once they own intellectual property that they own something of value,” she said. “This is not necessarily the case. IP on its own is meaningless and if you are going to invest take the time to invest in IP strategically because that investment should be premised on economic returns . . . The value of IP is to create exclusivity in the market place. Based on that exclusivity you want to be able to generate premium pricing, increased sales and have a positive economic effect generally.”

Pointing out that the various forms of IP played different roles, the IP expert said the IP should allow the company to offer a unique selling proposition, facilitate the development of brand loyalty and standards while building reputation, communicating quality and assisting consumers in identifying products

Dr Smith, who was addressing the forum on Using Intellectual Property Rights to Leverage Rum Brand Development, also warned rum producers to pay close attention to patent applications.

“From the discussions I have had with industry players in the region, I don’t think a lot of attention is paid to the patent system,” she declared. “I am suggesting that if you want to get a good understanding in terms of where competitors and potential competitors are going you need to start paying attention to patent applications.”

Adding that brand was also a critical area to focus on, Dr Smith pointed out that there were several elements that made up the brand including the trade name, packaging, domain name, product design, knowledge, business processes and recipes.

“Importantly, these are things that communicate the product or service to consumers,” she said, adding that they should be “understood as legal objects”.

“All of this help to position you in the market and are considered as part of the definition of the brand. In fact, it goes even one step further where a brand can speak to the organisation as a whole,” she added.

Chief Executive Officer of Media InSite Ltd. Allison Demas urged Barbadian and Caribbean rum producers to learn from what customers were saying about their competitors’ products.

“If you want to maintain your market lead or become the market leader you have to be acutely aware of what your competitors in your industry are doing, what are customers saying about their rum products and how can you learn from maybe their customer pains in order to gain a competitive edge,” she said.

Demas, who presented a study of six regional rum brands between October 2019 and November 2021, also pointed to the need for more domestically and regionally generated conversation surrounding rum.

She also suggested there was a need for greater advertising of the products in traditional media to help boost awareness of the products.

“When it comes to paid traditional media, focusing on Barbados, we see that there is a definite downward trend over the two-year period,” she said.

Chief Executive Officer of WIRSPA Vaughn Renwick explained that people shied away from advertising on some media in Barbados due to the access to underage consumers and “an increasing level of focus by health advocates on how the industry advertises”.

But Renwick agreed that brands needed to be “more organised with their IP and much more hard-nosed about it”, and that it was worth paying attention to what consumers were saying about competitors and what research was being done on the industry. marlonmadden@barbadostoday.bb