How big is the cosmetics market in China? According to statistics, the market size of China's cosmetics industry is expected to be about 500 billion yuan in 2019, which is the second largest cosmetics market in the world only after the United States. At the same time, the CAGR (compound annual growth rate) of China's cosmetics industry in the past five years is 9.1%, much higher than the global average CAGR of 4.1%, and the market size continues to climb. Because the transparency of the industry needs to be improved, although there are certain differences in the data of different caliber, the current Chinese cosmetics market is the world's second largest cosmetics market, and it is still in a period of rapid growth. On the one hand, the scale of China's cosmetics market is huge, and on the other hand, the scale of the general trend of China's consumption upgrading is still growing rapidly, which means that China's cosmetics market has great imagination. Based on the continued optimism of China's cosmetics, the current development of China's cosmetics industry has shown a lively scene. In addition to imported brands and scale domestic brands are still lively, new brands, new concepts, new channels emerge in endlessly.

Cosmetics belong to the category of consumer goods. Brand, channel and product are the three key factors that every cosmetics operator has to pay attention to. And because the cosmetics industry is not a high-tech industry, the results of commercial investment will be precipitated into brand value to a large extent, so the brand has become the most recognizable element of cosmetics, but also precipitated into the most valuable assets of enterprises. As a cosmetic entrepreneur, we must pay attention to brand protection and keep the brand. Wang Laoji, Jiang Xiaobai, Doctor Li and other brand incidents have also sounded the alarm to China's cosmetics operators from the opposite side. Awareness is a prerequisite for protection. In the practice of cosmetics management, many cosmetics operators have some misunderstandings about brand cognition. Every brand misunderstanding is a trap in the protection of cosmetics brand, and once it falls into it, it will affect the realization of the business purpose of the operator to a large extent, and even lead to the operation of zero. Cosmetics operators should accurately recognize the brand, understand the brand protection, so as to prevent problems before they happen. How to correctly recognize cosmetics brands? Jiao Hanwei, lawyer of Shanghai Guohillhouse Law Firm, will discuss the problem of cosmetics brand cognition from two perspectives of law and cosmetics business, for the reference of cosmetics operators.

Is a brand a trademark?

Brand and trademark are two different categories of concepts, the former is a commercial term, the latter is a legal term, the two are easy to confuse. In daily work, many people mix and generalize these two terms, and even mistakenly think that the brand is a trademark, which is obviously a cognitive misunderstanding. Brand is a kind of comprehensive perception formed by consumers in the face of comprehensive components of services or products. A trademark is a specific mark used to distinguish goods and services, and consumers can identify the producers, operators and service providers of the goods through this mark. The trademark is an important part of the brand, but it is not equal to the brand. In addition to trademarks, trade names, product names, product series names, unique ICONS, unique bottle shapes, unique flower boxes, unique packaging tones, and goodwill are all important components of cosmetics brands. Therefore, when it comes to cosmetics enterprise brands and cosmetics brand protection, it must not be simply equivalent to trademark protection. The brand protection of cosmetics enterprises is the comprehensive protection of a series of brand elements of enterprises, including but not limited to trademarks, trade names, product names, product series names, unique ICONS, unique bottle shapes of products, unique flower boxes of products, unique tones of products, domain names, goodwill, etc. Otherwise, cosmetic operators in the process of brand protection will appear the business risk of leakage.

Can I rent someone else's trademark?

China's trademark law stipulates that a trademark registrant may authorize others to use its registered trademark by signing a trademark license contract; Where a person is licensed to use a registered trademark of another person, the name of the licensee and the origin of the goods must be indicated on the goods on which the registered trademark is used. Therefore, it is legal to rent or lease another person's trademark. However, from the actual situation of cosmetics business, whether to rent others' trademarks depends on the market value of the trademarks themselves and the different commercial purposes of each operator. If it is a well-known brand, the operator wants to borrow the brand influence of the well-known brand to quickly harvest the market, you can consider renting a well-known brand for cosmetics business. If the trademark is not a well-known trademark and has no market value, you should not consider renting another person's trademark. If the cosmetics operators plan to invest a lot of brand promotion to cultivate the brand, open up the market, and build a century-old business, they should not rent other people's trademarks. Because a large amount of brand promotion investment invested by operators will precipitate brand value to a large extent, and under the trademark lease mode, the lease term expires or trademark lease disputes occur, cosmetics operators will face a huge business risk of making wedding clothes for others, which is not a good business decision in business, such as Wanglaoji brand. Therefore, cosmetics operators can rent other people's trademark products, but should be careful.

Is there a legal feasibility assessment before trademark determination?

In the practice of cosmetics business, many cosmetics operators consider more commercial factors such as industry relevance, promotion convenience and personal preferences when determining the use of a trademark, while ignoring the legal feasibility assessment of the trademark. In the absence of legal feasibility assessment, operators are likely to face the dilemma of determining the use of trademarks that are the same or similar to the registered trademarks of competing products, which will lead to failure to register or infringement of others' trademark rights, which will not only fail to achieve commercial purposes, but may even cause real losses. Therefore, when cosmetics operators determine the use of a trademark, the correct posture should consider commercial factors such as industry relevance, promotion convenience, and operator preferences, but also consider the legal feasibility of trademark use. The same should be true for the main trademark of the main push. The bottom line of legal feasibility is to ensure that the trademark does not infringe on the trademark rights of others' existing trademarks and avoid causing trademark disputes. At the same time, it is also necessary to further judge the probability of trademark registration success, if there are substantial obstacles to registration success, the probability of registration success is very low, it should not be used. Because the trademark cannot be successfully registered, it does not enjoy trademark rights and other trademark rights, which means that it cannot monopolize the use of the trademark rights and cannot enjoy the brand value. This flaw is a major flaw in law, and it will also encounter great challenges in finance, financing, operation and other aspects.

Can a trademark that has not been successfully registered be promoted?

In principle, trademark registration in China applies the principle of application first, and the application cost is not high. Due to the low application registration threshold, the number of registered trademarks in China is huge. According to official data, in 2018, the number of trademark registration applications in China was 7.371 million, and the number of trademark registrations was 5.07 million; By the end of 2018, the number of valid trademarks registered in China (excluding foreign registrations in China and Madrid) reached 18.049 million, and the number of trademarks owned by every 10,000 market entities reached 1,724. Such a large number of trademark registrations means that catchy trademarks have been basically registered by operators. Therefore, at present, the probability of trademark registration failure in our country is very high, unless the operator applies for registration of the trademark has a certain originality. If the trademark is still in the process of registration, it is not recommended to make large-scale branding investments unless a very careful legal feasibility assessment has been carried out. On the one hand, it will bear great registration risks, and on the other hand, large-scale brand promotion without the registration of the brand may attract the attention of other competitors and increase the uncertainty factor of trademark registration. Therefore, cosmetics operators should consider the registration status of trademarks when carrying out brand promotion, and carefully invest in brand promotion for trademarks that have not been successfully registered.

Can you rest easy with a trademark certificate in your hand?

In practice, many cosmetic operators think that as long as the trademark in their hands has a trademark registration certificate, they can rest easy, which is obviously a major cognitive misunderstanding. The trademark registration certificate obtained by the applicant is a landmark event that enjoys the exclusive right to use the trademark. For most trademarks, the acquisition of trademark registration certificate does mean that there is a stable trademark rights, but in special circumstances, the acquisition of trademark certificate does not mean that the trademark enjoys stable trademark rights. China's trademark law stipulates that if there is legal situation in which the trademark registration certificate has been obtained, the trademark Office, other units or individuals may apply to revoke the registered trademark; After the Trademark Office declares a registered trademark invalid, the exclusive right to use the registered trademark shall be deemed to have ceased to exist from the beginning. What are the legal circumstances under which a registered trademark is revoked? Where a trademark registered by fraudulent means or other unfair means is obtained, a trademark already used by another person and having certain influence is registered, a trademark identical to or similar to a trademark already registered by another person on the same kind of goods or similar goods, or an unauthorized agent or representative registers the trademark of the principal or the represented in his own name Trademark, etc., may apply to the State Trademark Office for cancellation of the trademark. It should be noted that in current judicial practice, a large number of registered or hoarded trademarks, which are not for the main purpose of use, without legitimate reasons, especially those with the transfer or intention to transfer their registered or hoarded trademarks for profit purposes, can usually be identified as "other improper means to obtain a registered trademark situation." According to this, a large number of registered trademarks that are not hoarded for the purpose of use face great challenges in the stability of rights, and cosmetics operators should be cautious about this risk when purchasing trademarks from third parties. In short, cosmetics operators should evaluate the stability of registered trademarks when purchasing trademarks from third parties or before large-scale promotion of their own trademarks, otherwise they may face the risk of brand zero. For example, the Jiang Xiaobai brand was withdrawn due to the stability of the brand. Therefore, it is not that you can rest easy with a trademark certificate in hand, and whether the state of trademark rights and trademark certificates are stable is two different issues.

Can registered trademarks be used in cosmetics?

In the practice of cosmetics business, some cosmetics operators will have another cognitive misunderstanding, that the trademark registration certificate must be used to produce cosmetics, this view is obviously wrong. Cosmetics belong to special products, the cosmetics industry belongs to special industries, and its business behavior is regulated by the special industry supervision system. As an important part of cosmetics, trademark is a necessary part of cosmetics labels and instructions, which is not only subject to the adjustment of trademark law, but also needs to meet the requirements of cosmetics industry regulatory regulations. For example, cosmetics in China implement a regulatory system of separation of cosmeceuticals, and cosmetics advertisements are not allowed to promote medical effects; Cosmetic labels, small packages or instructions must indicate indications, must not advertise curative effects, and must not use medical terms. In 2019, the FDA once again reaffirmed its regulatory attitude towards the concepts of "cosmeceuticals", "cosmeceuticals" and "medical skin care products" in the form of "Cosmetic Supervision and Management FAQ (1)", clearly pointing out that there is no concept of "cosmeceuticals" in China, and promoting the concept of "cosmeceuticals" and "medical skin care products" are illegal acts. If a trademark held by a cosmetics operator is successfully registered, it may not be used in cosmetics if it promotes medical effects to consumers or contains medical terms. Otherwise, it will face business risks such as product removal, administrative penalties, and other brands such as Doctor Bai and Doctor Li have adjusted due to this problem. The adjustment of brand is a major operational risk for cosmetics operators and has a great impact on the market. Therefore, whether a successfully registered trademark can be used to produce products needs to be further judged from the perspective of regulatory norms in the cosmetics industry. This point needs special attention of cosmetics operators, and many legal workers also have this misunderstanding in practice.

Only by accurately recognizing the cosmetics brand, can it be possible to keep its own brand. The above problems are the problems that cosmetics brand cognition has to know. Every cosmetics operator, especially those in the entrepreneurial stage, must review their brand again, look forward and systematically guard their brand, and lay a solid foundation for their cosmetics industry.