A cautionary tale of how not to brand a product.
This is the tale of two Lamborghinis. One of them is the legendary Ferruccio Lamborghini, the mechanic turned entrepreneur who turned his Italian tractor company into Automobili Lamborghini S.p.A, makers of extremely fast cars. Automobili Lamborghini was eventually purchased by Audi in 1998, but retains its reputation for high end, high performance automobiles.
The other is his son Tonino Lamborghini, who took the famous family name and the “raging bull” logo and applied this to his own brand of luxury items. Unlike his dad’s creation, the Tonino Lamborghini brand has been licensed on a range of luxury goods ranging from watches, clothing, energy drinks, boutique hotels, laptops, and mobile phones. Even Cigar cutters. But no cars here.
What does the man on the street think when he hears the name “Lamborghini” ? Most people asked might think of the famous fast cars. In the same class as brands like Maseratti and Ferrari. Not watches, nor designer energy drinks.
You might say that Globe’s marketing campaign for the “Tonino Lamborghini Tattoo 4G Broadband Stick” sought to exploit that connection. Globe licensed the brand from Singapore-based Primo Mobile. The ads took the Tonino Lamborghini luxury brand, applied it to a Huawei broadband modem, and placed a focus on speed, with a race car driver as its image model. But the brand remained that of the luxury goods company, not the automobile legend.
So when on August 23, when the Italian company Tonino Lamborghini s.r.l. posted a PDF of a press release on its website, Twitter feed, and Facebook page accusing Globe of counterfeiting the brand, people took notice. After all, the Globe product was by now well marketed.
BOLOGNA, ITALY–(Marketwire – Aug. 23, 2011) – Tonino Lamborghini s.r.l., an Italy-based company which is the sole lawful owner worldwide of the trademark “Tonino Lamborghini” hereunder
wishes to inform its customers that unauthorized people are currently trading online and through Globe stores a “4G Tatto Tonino Lamborghini” broadband stick which is a counterfeited product.
Tonino Lamborghini s.r.l. has never manufactured or authorized anyone to manufacture such a product which constitutes therefore a serious trademark infringement.
Moreover the advertising campaign “Feed your need for speed” featuring Marlon Stockinger, first Filipino to win a formula race in Europe, is deceitful and unlawful since it leads to a serious likelihood of confusion between two different and separate brands and businesses that is to say “Tonino Lamborghini” and “Automobili Lamborghini“.
Tonino Lamborghini s.r.l. shall take any legal action to protect the brand.
Dott. Gian Luca Filippi
Tonino Lamborghini s.r.l.
T. Lamborghini promised to take legal action. Without mincing words, the company branded the Globe broadband stick “a fake.”
Oddly enough, the press release on the PDF was dated August 3. But this was posted on the website on August 23.
Now came the fallout – and the questions. Globe had mounted an expensive national marketing campaign. Ads were produced, posters printed, modems had been branded. Did Globe resort to trademark infringement?
Needless to say, social media and the local business and tech press had a heyday with this.
Globe’s corporate communications team attempted to do quick damage control by scrambling a press release by evening of the August 24 explaining that in their view, they had done no wrong. As they explained it, the Tonino Lamborghini brand was duly licensed from Primo Mobile, the Singapore-based licensee for the Tonino Lamborghini brand for products such as mobile phones and laptops.
Globe Telecom obtained authorization to use the name and logo Tonino Lamborghini through an agreement with Primo Mobile, the master franchisor of mobile phone related products for the Italian brand Tonino Lamborghini. PrimoMobileis a Singapore-based company that has a master license agreement with Tonino Lamborghini s.r.l. and is duly authorized to sub-license the use of the Lamborghini logo. The design of the Globe Tattoo Tonino Lamborghini 4G USB sticks was reviewed and approved by Primo Mobile.
Globe tried to brush the accusation off the whole thing as “a misunderstanding”.
But the statement failed to address one aspect of the Tonino Lamborghini: What they termed as “deceitful, unlawful” misrepresentation of the brand due to what they deemed as a willful attempt to connect the Tonino Lamborghini brand with daddy’s old company Automobili Lamborghini.
On its Facebook and Twitter pages, Tonino Lamborghini thoroughly rejected the explanation.
Tonino Lamborghini Group wishes to clarify that Primo Mobile had been granted only a trademark license – neither a master license nor a master franchise – but such trademark license agreement was duly terminated by the licensor, Tonino Lamborghini s.r.l., some months ago. In any case, such trademark license agreement did not authorize Primo Mobile to sub-license the use of the Tonino Lamborghini trademark and logo.
This is quite a royal screw up. The trouble is, it’s not clear who screwed who. Did Tonino Lamborghini screw Primo Mobile? Did Primo Mobile screw Globe? Or was it unaware of all this when the trademark deal was signed?
What will happen now? That’s what everyone wants to know. Everyone also has a theory or two, here are mine:
Theory #1: Heads will roll somewhere. Or there will be furious slapping of wrists. Ether in Singapore, or along Pioneer street.
Theory #2: There will be a lawsuit, or a number of them. Tonino Lamborghini will sue Globe. Globe will sue Primo Mobile. Primo Mobile will sue Tonino Lamborghini.
Theory #3: There will be a settlement, and it will be a big one. After all, trademark infringement suits can be more lucrative than licensing deals.
Theory #4: Regardless of how the lawsuits go, the Tonino Lamborghini brand will be withdrawn from the local modem market. The brand has now been tainted. The campaign will be withdrawn and there will be a major brand relaunch.
All because the completely wrong Lamborghini was licensed.
In the meantime, comedian Gabe Mercado had a very interesting analysis on the situation, posted on Google+, which neatly summarizes the whole affair:
May gumagawa ng skin whitening lotion. Gusto niya, ma endorse siya ni Ricky Reyes. Para naman bongga di ba?
Pero mas murang magpa-endorse sa Reyes Haircutters. Kaya kumuha siya ng endorsement mula sa Reyes Haircutters sa pamamagitan ng isang advertising at talent promotion agency.
Pero ang nilagay niya sa endorsement niya ay “Skin Whitener na Gandang Reyes.”
Nagalit tuloy ang Reyes Haircutters habang si Mama Ricky naman, wala siyang care.
Very well put.