Taylor Swift is no dummy.

At just 25, the superstar country-turned-pop singer is one of the most influential and wealthiest women in show business. Her move from country to pop was controversial and divisive, but it turned out to be an incredibly wise decision. Her first pop album, 1989, sold more copies last year than the next 106 albums combined.

The fact that her album comprised 22 percent of all albums sales in 2014 is not the reason Swift is in the spotlight these days. More newsworthy is the fact that the young business mogul filed late last year for trademark protection on a number of phrases she employs on her album, including:

"Could show you incredible things"

"Nice to meet you. Where you been?"

"'Cause we never go out of style"

"This sick beat"

While she most certainly was not the first person to say these phrases, she is trying to ensure that she becomes the last do it for free.

While the idea of trademarking a phrase may seem audacious, it can be a smart move for entrepreneurs who produce and sell intellectual property and rely heavily on their image to create value. Ultimately, what these trademarks will do for Swift is shift the power of controlling her image from pirated merchandise producers back to her.

Put this in contrast with Lagunitas, a popular regional craft beer producer out of Petaluma, California, which earlier this year filed a suit against a better known and nationally distributed brand, Sierra Nevada, alleging infringement on Lagunitas's trademarked "IPA." The acronym stands for "India pale ale," which is one of the most widely produced styles of craft beer made in the U.S.

While Lagunitas may have had a case for infringement, the public took exception to the lawsuit and lambasted Lagunitas on social media for trying to capitalize on what many people perceived as a phrase almost as common in the industry as the word "beer" itself. Lagunitas, feeling the immense pressure from the public, backed down and withdrew its lawsuit just a few days later, stating in a tweet, "Today was in the hands of the ultimate court; The Court of Public Opinion and in it I got an answer to my Question; Our IPA's TM has limits."

Clearly, the strategy of trademarking to build and protect a brand has pros and cons. Here are a few things to consider before you dive into the trademark fray.

Consider why you are trademarking.

Securing strategic trademarks while building a brand is a good strategy, especially if you have a unique identifier that differentiates you from competitors. Swift certainly has an established brand, but she is smart to consider trademarking popular phrases from her albums as a means of protecting her brand from dilution by people seeking to capitalize on her popularity.

If, however, your goal is to try to secure a trademark for the simple goal of squeezing out or hurting a competitor or profiting from a trend, it could ultimately backfire. For Lagunitas, that was not the strategy behind their lawsuit, but it certainly was perceived as such. The company lost focus on what their brand stood for--namely the high quality of craft beer it produces, not a superficial acronym.

Consider the threats.

For entrepreneurs who produce intellectual property, protecting your "product" is of utmost importance. As the music industry continues to evolve, artists will rely more on tours and ancillary products to generate income. Unfortunately, knock-off products that imitate the artists' likenesses abound, so any strategy that allows you to crack down on infringement of your image and take control of merchandising is a smart strategy.

For craft beer, the industry is growing at an incredibly fast clip and has a great deal of room to grow further. While Lagunitas, or any company for that matter, should certainly not allow others to infringe on a trademark, there was little threat from the use of this acronym, which had already been adopted throughout the industry as standard nomenclature. At this point, the acronym's use by Sierra Nevada, a much larger and more popular brand, could have been leveraged to garner valuable visibility for Lagunitas--just not by way of lawsuit.

Consider your audience.

Taylor Swift is well known for having a good rapport with her tens of millions of fans. While she might have alienated some of her country music followers when she made the jump to pop star, very few fault her for the move. Because of this relationship and her solid reputation, and because most people understand the intensely competitive nature of the music industry, she is more likely not to irk her fans with what some people might believe to be a silly trademark filing.

On the other hand, Lagunitas operates in the craft beer industry, where cooperation and mutual support across the industry is common, and where many companies even collaborate to produce new and innovative offerings. More important, craft beer consumers support the industry more than individual companies, so any effort that might impede the growth or hurt the reputation of the industry is seen as intrusive and arrogant.

What do you think? Do you agree with Taylor Swift's trademark filing? Do you believe Lagunitas should have protected its trademark? Please share your thoughts below.

Published on: Feb 2, 2015
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