Trademark Portfolios As Business Assets: Balancing Legal Protection With Brand Strategy In Nigeria

Introduction

Trademarks are the cornerstone of every business due to their crucial role in establishing authenticity and distinguishing products and servicesin the marketplace. Trademarks serve not only badges of trust but also as powerful tools of recognition in the minds of consumers. For instance, the bitten apple logo is instantly associated with Apple Inc., and the overlapping ovals with Toyota.

In Nigeria, certain trademarks have grown beyond their original role as product identifiers to become generic references for entire product categories. Unilever's Close-Up is commonly used to describe all toothpaste, Procter & Gamble's Pampers to mean any diaper, and . Besides the lurking risk of genericide, his phenomenon underscores how strategic trademark use can elevate a brand from being a mere signifier of source to a dominant market asset with cultural and economic influence. Properly managed, trademark portfolios not only safeguard business identity but also anchor market leadership both in Nigeria and globally.

Consumers, make many decisions, sometimes consciously but mostly without even realizing it, based on the goodwill and reputation of trademarks.¹ Trademarks, by enabling companies differentiate themselves and their products from those of their competitors, play a pivotal role in the marketing strategies of companies, contributing to the definition of the image and reputation of a business and its products in the eyes of consumers.²

Satisfied consumers often develop an emotional attachment to a mark. They perceive products or businesses bearing the mark as sharing a brand identity or image, which reflects a set of desired attributes, benefits or values. A positive image or reputation of a business creates a relationship of trust. The trust so developed provides the basis for developing a loyal clientele and enhancing a business's goodwill in the long term.³

Against this background, it becomes clear that businesses must take deliberate legal and strategic measures to protect their trademarks, ensuring consistency in brand identity while safeguarding reputation and long-term value.

Trademarks in Nigeria: The Legal Framework

Under the Nigerian Trademarks Act Cap T13 Laws of the Federation of Nigeria, 2004 (the "Trademarks Act"), a trademark is a mark used or proposed to be used in relation to goods⁴ for the purpose of indicating, or so as to indicate, a connection in the course of trade between the goods and some person having the right either as proprietor or as registered user to use the mark, whether with or without any indication of the identity of that person. A trademark also includes certification marks which are marks adapted to distinguish goods certified by any person in respect of origin, material, method of manufacture, quality, accuracy or other characteristic, from goods not so certified.⁵

In general terms a trademark includes a visible distinctive word, letter, number drawing, picture, shape, color, logotype, label or a combination of one or more of these. The design of a logo may be an abstract design, stylization or simple reproduction of everyday objects or images. An increasing number of countries consider a single color, a three-dimensional sign (shape of a product or packaging), an audible sign (sound), an olfactory sign (scent or smell), a moving image, a hologram, a taste or a texture of a product to be a mark.⁶ It is also possible to get trademark rights over common words or phrases under certain circumstances where they have been accepted by the public to be associated with a brand.⁷

A trademark is protected by its registration under the Trademarks Act and also through its use in the marketplace that has gained reputation⁸ . Even when a mark has acquired protection through use, it is still advisable to register it, as formal registration offers stronger legal safeguards. Trademark registration and protection are territorial. A trademark registered in Nigeria is limited to Nigeria.⁹

Trademark applications may be refused on absolute or relative grounds. Absolute grounds arises where the mark lacks distinctiveness, is unlawful, immoral, deceptive, or scandalous, or is likely to cause confusion. It also applies to marks that misuse official symbols or prohibited names, such as names of chemical substances, the Coat of Arms, the National Flag, or official titles like President or Governor without authorisation. Additionally, marks containing misleading terms such as "patent," "registered," or "copyright," or protected emblems like the Red Cross, Geneva Cross, or similar representations, are not registrable.¹⁰ Relative grounds for refusal of a trademark occur where the application is made by someone other than the true owner, is filed in bad faith, or has been fraudulently obtained. Registration will also be refused if the mark is identical or confusingly similar to an existing registered trademark.¹¹

In registering a trademark in Nigeria, the process in Nigeria begins with an availability search at the Trademarks Registry, which takes about three days. Once the application is filed, it is examined, and if accepted, an acceptance form is issued. The mark is then published in the Trademarks Journal, where it may face opposition within two months of publication. If no opposition arises, an application for sealing is submitted, and the certificate of registration is typically issued within three to six months.

Trademarks as Business Assets

A registered trademark is a valuable asset for a business to own. It offers security, value and ties directly into what drives revenue and value to a business. Experience shows that recognized brands are a lot easier to sell than those that are hardly known. A business in supplying goods and services engages with its customers under its trademark so that they can recognise the goods and services of the business and be confident that they would be getting what they desire.

By conveying a promise of familiar quality, brand recognition simplifies the buying decision for potential customers. This increases the effectiveness of marketing campaigns, enables a company to secure margins and helps lay the groundwork for expansion into new services or product lines.

Consequently, trademark registration protects a brand's revenue stream by preventing competitors from infringing on its marks and encroaching on its market space, thereby safeguarding market share and supporting business growth. As a negative right, it restricts third parties from using the same or similar marks for their products or services, enabling businesses to maintain clear boundaries around what is distinctive about their brand, which in turn attracts and retains customers.

Additionally, businesses may permit third parties to use their trademarks for selling goods or providing services in exchange for royalties or license fees, which is particularly valuable for expanding into new geographical markets. Likewise, a trademark can be registered in respect of goods or services that a business does not yet offer but intends to introduce in the near future, thereby securing protection in advance.¹² This strategic approach not only safeguards the brand but also provides the business with room to plan, expand, and grow at a sustainable pace.

Further, a healthy and well managed portfolio of registered trademarks can be licensed, mortgaged or sold. This is particularly important if a business is looking to raise finance, or its owners are working on an exit strategy.¹³

The Strategic Balance: Best Practices for Nigerian Businesses

All assets that drive market success, including trademarks that resonate with consumers, require proper legal protection. Below are some strategic measures Nigerian businesses can adopt to enhance their brand positions.

First the trademark sought to be protected must distinguish your products or services from that of your competitors. Make sure to create a distinctive and registrable trademark for your product. Do not let your brand become a generic term such as escalator or nylon.

Further, both core and secondary trademarks should be registered. Using Tolaram's "Indomie" brand as an example, besides registering the main "Indomie" trademark, sub-brands such as "Indomie Belle Full" and "Indomie Relish" Furthermore, both core and secondary trademarks should be registered to ensure comprehensive protection. For instance, beyond registering a primary mark like Tolaram's "Indomie," sub-brands such as "Indomie Belle Full" and "Indomie Relish" should also be secured. In addition, slogans that uniquely identify a brand such as Nike's "Just do it" or MTN's "Everywhere you go" ought to be registered for protection. Distinctive product packaging, as well as trade dress (the overall look and feel of a product or its packaging that signifies its source and sets it apart from competitors), may also be protected under trademark law.¹⁴

Trademark registration strategies should be closely aligned with a business's growth plans. Beyond covering current products or services, trademarks should also be registered in classes that reflect potential future expansions.¹⁵ For instance, a textile and fabric business planning to diversify into clothing could secure registrations in Classes 24 and 35. Similarly, businesses with export ambitions should pursue cross-border registrations in target markets, a defensive approach that prevents copycats from exploiting their marks in those jurisdictions. In addition, businesses may choose to license their trademarks to franchises, distributors, or partners, leveraging them in co-branding or brand extension strategies to drive wider market presence.

The importance of conducting regular trademark portfolio audits cannot be overstated. These audits help businesses review their portfolios to confirm that all relevant marks are duly registered and protected. They also reveal gaps where additional registrations are needed and highlight unused marks that may dilute brand value, prompting decisions on abandonment or restructuring potentially converting them into revenue through licensing. Moreover, audits can uncover instances where a business is using third-party marks, thereby mitigating the risk of infringement claims.

It is crucial for businesses to continuously monitor the marketplace for infringing or confusingly similar marks. This involves conducting trademark watches by reviewing journals published by the trademark registry and keeping track of brand names actively used in the market. Once potential infringements are identified, swift legal measures should be taken, including issuing cease-and-desist letters, filing oppositions, or initiating lawsuits. Additionally, brand owners can collaborate with regulatory bodies such as the National Agency for Food and Drug Administration and Control and the Standards Organisation of Nigeria to combat counterfeiting and safeguard their trademarks.

Brand campaigns should consistently reinforce trademark identity by ensuring marks are used correctly and uniformly. Both employees and consumers should be educated on proper usage to prevent genericide for instance, saying "Indomie noodles" rather than simply "Indomie." To support this, businesses should develop a trademark usage policy that clearly outlines the rules for how brand names, logos, slogans, and other marks may be used by employees, partners, licensees, distributors, the media, and even the general public.

Finally, it is important to note that when raising funds, companies should highlight their trademarks in valuations and investor pitches as evidence of the strength of their intangible assets.

These strategies deliver the best results when there is close collaboration between the brand, marketing, and legal teams. Marketing teams should work hand-in-hand with intellectual property counsel before launching new campaigns, logos, or brand names to ensure that creative elements such as taglines and logos are not only distinctive but also legally registrable.

Conclusion

In Nigeria's evolving marketplace, trademarks have moved beyond simple identifiers of origin to become strategic business assets with immense commercial, cultural, and reputational value. A carefully managed trademark portfolio provides businesses with a competitive edge, enabling them to protect market share, expand into new markets, attract investment, and foster consumer trust and loyalty. However, these benefits can only be realized when legal protection is deliberately balanced with brand strategy.

By adopting proactive measures such as registering both core and secondary marks, protecting trade dress and slogans, conducting periodic audits, monitoring for infringement, and integrating usage policies businesses can maximize the economic potential of their trademarks while ensuring long-term sustainability. Ultimately, the true power of a trademark portfolio lies not only in the strength of its legal protection but also in how effectively it is aligned with brand strategy to create lasting goodwill, enhance business value, and secure market leadership in Nigeria and beyond.

Footnotes

1. WIPO Resources. Module 2 – Trademarks and Industrial Designs https://www.wipo.int/export/sites/www/sme/en/documents/pdf/ip_panorama_2_learning_points.pdf > accessed on September 21, 2025

2. Ibid.

3. Ibid

4. "Goods" are defined to include services. Trademarks Act, s. 67(1)

5. Trademark Act s. 67(1)

6. Naomi Jasita Lalloo, 'Protecting Non-Traditional Trade Marks: A Commercial Perspective', Trinity College Law Review <https://trinitycollegelawreview.org/protecting-non-traditional-trade-marks-a-commercial-perspective/> accessed September 30, 2025

13. A good example is Shoprite sold its Nigerian business to Ketron Investment in 2021 and moved from an ownership model to a franchise model. See Nqobile Dludla, 'South Africa's Shoprite sells Nigerian business to local firm Ketron' (Reuters, 2 June 2021) <https://www.reuters.com/article/business/finance/south-africas-shoprite-sells-nigerian-business-to-local-firmketron-idUSL2N2NK0GD> accessed October 1, 2025.