Guard Against International CopycatsIn direct response, we accept and maybe even expect a climate of legal battles in protecting products in the U.S. and international markets. Because the United States is the primary sales focus for most DR marketers, most legal dollars are spent defending rights and enforcing patents on U.S. soil alone.
The international marketplace is sometimes an afterthought and not given the attention it deserves. International sales often surpass the U.S. life span of a product campaign, adding much more revenue.
Flipping on the international sales switch. In a successful U.S. rollout, millions of media dollars are spent, thousands of products are shipped per week and the story spins that you have a hit. It is important that U.S. product success information is fed quickly to key distributors worldwide. The quicker out of the gate you are, the better chance your product has in the global marketplace before copycat products arrive.
Unless the U.S. marketer simultaneously timed an international DR campaign, it will take at least three months for a product to test outside the United States. The delay is caused by clearing the product's show for airing, translating the show into local languages and scheduling airtime. Often, dry testing is not allowed, and small test quantities must be received before the show airs.
U.S. airwaves are watched to see what DR shows air frequently. If the infomercial is promoting a small exercise product, then copycat product molds are being made up. It is only a matter of months before the copycats appear in the international marketplace.
Surely, a hit product has secured rights? At the front end of product development, the diligent DR marketer has cleared the ownership rights. Perhaps rights were transferred and a royalty paid to the inventor. Documents are presented to legitimize that all is in order and that patent rights are solely the property of the marketer. If you are a U.S. marketer, obtain a reputable patent attorney who has affiliate offices worldwide.
There have been situations in which the U.S. marketer assures its international distributors that product rights are sealed only to learn later that a copycat is being produced by the same party that assigned those rights to the U.S. marketer in the beginning.
What can a copycat product do to a market? Early in a successful fitness product campaign, the show tested in one Asian market and did not perform local media ratios. Because this particular fitness product was unfamiliar to the local market, the idea was to educate the consumer, and the international distributor continued his media campaign at a loss. After a month, consumer response increased, and what were once negative results skyrocketed to a 50-to-1 ratio. Demand for the product rose. In five months, monthly orders of 100,000 units were being shipped, and forecasts doubled.
As the product was gaining consumer awareness, local importers were also noticing the DR campaign and bringing in a copycat product and selling it in retail stores. Copycat products have appeared internationally before, but this was different. This copycat product had the same patent information that appeared on the legitimate product.
Millions of dollars in sales have been lost to copycat products. But with the suppliers' support, copycat manufacturers and patent violators will be stopped.
What DR product suppliers should do to protect their products internationally.
• Ensure that all rights and patent documents are in order. Obtain a patent lawyer who has international affiliations. For international sales, patents should be filed internationally. U.S. patents alone are not enforceable in most countries. Sometimes trademark registration is necessary as well.
• Work with loyal, experienced international marketers. If copycats surface, you may quickly get samples and contact local lawyers and local authorities. The swifter the action, the better your chance to stop the violators. Many times, violators must be taken to court.
• Have a copycat strategy in place. Too often, when copycats appear, international distributors stop their campaigns. With a strategy that includes cease-and-desist packages, financing local legal battles and market visits, the international distributor will want to help fight the battle, especially if money can still be made.
• Ensure that your product has special markings unknown to anyone. Dimples and alphanumeric codes are examples of identifying markings that will differentiate your product from exact market copycats. This identification is helpful when copycats have already polluted the market and you must separate good product from the bad.
Rights enforcement should become part of your international sales strategy. Part of that is to set aside money for legal fees. In most of your key international markets, take the necessary precautions, file patents and trademark for your product. Deal with this issue at the front end of the product campaign. This will let you focus more on making sales than losing them.