November 20, 2006
Branding Naming: Starbucks May Get Scalded
The disagreement that I have written about before between Starbucks and Ethiopia over the coffee giant’s trademarking of the country’s Sidamo, Yirgacheffe and Harar bean names is about to boil over.
Starbucks wants Ethiopian sellers of these beans to abandon efforts to trademark the names (after prompting the USPTO to call the names “generic”) and instead use a geographic certification model (think Jamaican Blue Mountain Coffee, Florida Orange Juice, Napa Valley Wines) to protect their names.
There is also a fight over who wanted to trademark the names first. The green LA girl blog has started a nifty little timeline to help track Ethiopia’s effort to trademark some of its coffee names.
The risks here are enormous and go right to the heart of brand naming. If Ethiopia gets its trademark, it risks pricing itself out of the market; if it goes for regional certification, it risks losing brand name equity and an important card in negotiations with coffee sellers. But in this case, Ethiopia cannot risk losing Starbucks, its biggest buyer, and is offering a licensing agreement to the Seattle-based coffee company free of charge.
At the same time, it should be noted that Ethiopia is becoming a steamy matter for Starbucks - bloggers are frustrated over what they see as a clear case of corporate exploitation.
It is within Starbucks' best interest to come to a public, amicable agreement with the growers before the Starbucks brand name suffers serious harm. Already radical Starbucks baristas have declared November 24-25 the “Global Day of Action Against Starbucks”. This is exactly the kind of brand name nightmare that Nike and Apple have both managed to put behind them.
The fact is that the National Coffee Association is on Starbucks' side, stating that a trademark move on the part of Ethiopia is a scheme that “is going to hurt the Ethiopian coffee farmers economically”. It seems to me that Starbucks could put its weight behind a regional certification program, which would protect the interests of Ethiopian farmers as well as the company name.
Starbucks should also go on the offensive and take the extra effort to prove to suspicious activists that they are not engaging in exploitative behavior with Ethiopian growers or any other growers. Nobody likes to buy coffee from a rapacious corporate monolith, even one that is in the right, at least not the kind of people who frequent Starbucks.
Ethiopia, for its part, should tread carefully. The fact is, very few people have heard of these brand names (unlike, say, Blue Mountain or Kona) and if Starbucks is forced to stop selling them, you can bet that nobody will hear much about them in the future.
By the way, I hope my apostrophe use with the name Starbucks was correct.
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