Retailers in New Zealand may wish to consider protecting their retail store layouts using intellectual property (IP) rights.
One does not have to look far to see that a unique store look is a good business strategy.
Standing out from the crowd helps customers remember you. A unique store layout plays a critical role in establishing the goodwill and reputation of a retail business - it is an important visual representation of a company's brand.
To gain a leg up from competitors, retailers in recent times have been closely looking at how they outfit their stores. The trend has been to move towards a more eye-catching and distinctive layout. This has resulted in significant investment by retailers, with the objective of increasing foot traffic, improving sales, and enhancing the overall customer experience.
This investment has also led to retailers looking at ways they can protect their distinctive retail store layout using available IP rights.
Use of registered trade marks
In 2010, Apple Inc successfully registered two US trade marks for its retail store layout. Apple registered the retail store layout in both black and white and colour, andthe trade mark was described as 'the design and layout of a retail store. The store features a clear glass storefront surrounded by a panelled façade consisting of large, rectangular horizontal panels over the top of the glass front, and two narrower panels stacked on either side of the store front…". A full description of the store layout was provided.
In 2011, Microsoft obtained a trade mark registration for the design of 'a retail store with four curved table tops at the front and rear side walls and a rectangular band displaying changing video images on the walls'.
However, Happy Pizza was not successful in registering its restaurant store layout on the basis that it was generic and commonly found in the fast food industry. The court held that the nine elements taken as a whole, which included granite countertops and tabletops, extensive neon lighting, ceramic floors, etc, were generic and commonly found in the fast food industry.
The message seems to be when designing a retail store layout, it is best to focus on creating a few unique elements that define the overall theme of your retail store if you want to give yourself a chance to secure a trade mark registration for the layout.
A substantial list of generic elements that does not add substantially to the look and feel of the store will most likely be considered unregistrable.
Obtaining a trade mark registration for a store layout is not always plain sailing and can present various obstacles. While it is theoretically possible to seek trade mark protection for elements of a store design and layout, in practice, the New Zealand intellectual property office is likely to require persuading that the design or layout qualifies as a trade mark. To do this, it will be necessary to establish through the filing of evidence that the design or layout is distinctive. Easily said, but can be difficult to prove.
In addition, alleged infringers may be able to defend an infringement action by arguing that they did not use their store design as a 'trade mark'.
Other IP rights
Trade mark rights are not the only form of IP rights available to a retailer for protecting a store layout.
Copyright, patents and design protection could also be considered.
Features such as artwork, signage, plans and music may be protected under the Copyright Act. Where the store includes functional elements like display and shelving units, patent protection may be more suitable. The appearance of products, items of furniture, display and shelving units that appeal to the eye may be registered as a design.
Retailers that have used a combined approach in protecting their store layouts include Hooters, The Cheesecake Factory, and TGI Friday's Inc. The trend is gaining momentum in the USA but is not being ignored elsewhere.
With retail being such a competitive industry, it is no wonder that retailers are looking at how they can utilise the IP rights regime to protect what they have created from being misappropriated by others.
The last word
If the overall look and feel of your retail store is important to your business, seek advice on what you can develop, maintain and protect as part of your unique store layout.
An edited version of this article appeared in the September issue of NZ Retail.