What is trademark Goodwill?
According to Merriam-Webster’s dictionary Goodwill is:
1. “The favor or advantage that a business has acquired especially through its brands and its good reputation.
2. The value of projected earnings increases of a business especially as part of its purchase price.
3. The excess of the purchase price of a company over its book value which represents the value of goodwill as an intangible asset for accounting purposes.”
From a trademark perspective, goodwill is interchanged with reputation and represents the consumer’s willingness to purchase a good or service over and over again.
Trademark goodwill is the positive association that consumers have with a brand, which can include the brand's reputation, customer loyalty, and market share. Trademark goodwill is important in several ways.
First, it represents the value of a company's brand and can be a valuable asset on its balance sheet. Goodwill can be an indicator of a brand's reputation, and it can increase the overall value of the company.
Second, trademark goodwill can act as a barrier to entry for competitors. If a brand has established a strong reputation and customer loyalty, it can be difficult for new competitors to enter the market and compete on an equal footing.
Third, trademark goodwill can help a company expand into new markets or product lines. If a company has established a strong brand reputation, it can use that reputation to build trust and credibility with consumers in new markets or with new products.