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Why Nike filed to trademark virtual sneakers and clothing

By Don-Alvin Adegeest

Nov 2, 2021

Business

Image: Nike

Nike has filed an application to trademark its digital products, including virtual sneakers and clothing.

The US sportswear giant filed four requests with the U.S. Patent and Trademark Office on October 27 according to Bloomberg, to protect its marks in categories including “downloadable virtual goods” and related services for retail stores and entertainment.

Most well-known brands will have registered trademarks in the various markets they operate in, but these may not offer sustainable online brand protection. The powerful, global reach that external digital channels like virtual worlds, gaming, search engine marketing, social media and online marketplaces can offer companies to target customers means that the stakes have never been higher for brand owners to manage their trademark protection on these channels properly in order to benefit fully from the investment that they have put into establishing and growing the brand, says Trademark Now, a web-based trademark management platform.

A new frontier for trademarking

Fashion in the virtual world is a new medium and channel that many brands are exploring, but virtual counterfeits are already coming to the fore, which are infringements on real world goods. In Second Life, an application that allows people to create an avatar for themselves, fake Rolex watches, Cartier jewellery and Nike sneakers are already rampant.

Trademark law typically serves two purposes, says the World Trademark Review: protecting consumers from deception and a mark owner’s quality, goodwill and reputation. “To achieve these purposes, trademark law looks to whether a mark has been used in commerce in an infringing manner, such that there is a likelihood of confusion as to the source of the goods and services, taking into account the similarity both of the marks and of the goods or services with which they are associated. The ‘use in commerce’ requirement is important when it comes to virtual worlds. Are uses in-world actually in commerce for the purposes of registration? This question was answered in the affirmative by the US Patent and Trademark Office (USPTO) in 2007, when it allowed a virtual-world user to trademark her avatar.”

Virtual experiences

Virtual experiences are a new way for brands to connect with customers, like Burberry’s digital replica of its Tokyo flagship store which it debuted earlier this year. As young people continue to live more of their social lives online, the demand for digital-only artists, influencers and fashion is growing. In July a company called Foundr launched the first blockchain music label to only sign interactive virtual acts who will exist exclusively as avatars in the metaverse.

Growth engine

Nike would not be filing for digital trademarks if there was no profit to be had from a virtual presence. For example, Roblox, a hybrid social media/gaming platform, saw its market value surpass 45 billion dollars when it was listed on the stock market in March.

Digital items listed in Nike’s filings include headwear, eyewear, bags, backpacks and sports equipment, said Bloomberg. The applications are on an intent-to-use basis, and won’t be finalised until they’re in commercial use.

Facebook’s recent name change is just part of its journey as an early adopter of the metaverse. In the summer the social media giant held a conference on the potential of virtual and augmented reality for luxury companies. In Facebook’s Metaverse, avatars will interact with each other in workplaces, games, shops, concerts and everywhere else. And when we are meeting people, even if digitally, we will need virtual fashion, reports News 18. Zuckerberg said in the company’s 2021 Third Quarter Results Conference Call: “If you’re in the metaverse every day, then you’ll need digital clothes, digital tools, and different experiences. Our goal is to help the metaverse reach a billion people and hundreds of billions of dollars of digital commerce this decade.”

Nike, of course, will be at the forefront.

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