Linking patents to products: Measuring ROI with standardized patent taxonomy and IPfolio
When it comes to intellectual property, businesses often face difficulty answering two deceptively simple questions:
- Which of our products are actually protected by our patents?
- How do we measure the return on investment (ROI) from those patents?
Imagine a company with hundreds of patents in renewable energy. Their research and development (R&D) team has spent years innovating solar panel technology, but the business struggles to pinpoint which patents protect which product lines. Meanwhile, the finance team is trying to justify ongoing patent maintenance costs without a clear view of how those patents contribute to revenue.
This disconnect is common. From IP managers trying to map patents to product portfolios, to patent analysts tasked with evaluating patent strength and R&D teams seeking to align innovation with strategy, the challenge is the same: bridging the gap between complex legal language and real-world business impact.
In this blog, we explore how standardized patent taxonomy, can help link patents to products and measure ROI from those patents.
The challenge: Patents are verbose and technical
The first step to effectively managing patent portfolios and maximizing ROI is to understand how a company’s IP relates to its products. Most technology companies benchmark their IP portfolios at the tech level, relying on traditional patent classifications like the International Patent Classification (IPCs) or other national classifications.
These systems are designed for legal and technical precision, and this approach often fails to link patents to the actual products that they protect.
To address this gap, many organizations resort to custom in-house classification systems using Cooperative Patent Classifications (CPCs) that come with their own challenges. These include:
- No commercial application: CPCs are structured around technical domains, meaning they do not work efficiently within many business models.
- Too granular or too broad: The systems make it difficult to aggregate patents meaningfully at the product level.
- Classification ambiguity: Patents are usually assigned multiple CPC codes, which can lead to ambiguity in the classification.
- Manual tagging: Patent examiners often need to conduct manually tagging, which leads to inconsistencies
- Slow evolution: CPCs may not keep pace with emerging technologies or new product categories, which can especially affect faster moving sectors like biotech or IoT.
The solution: standardized product taxonomy
Traditional classification systems like CPCs weren’t designed with commercial strategy in mind. That’s why Clarivate developed a product-centric, AI-powered classification framework, which integrates seamlessly with our popular IPfolio software. It is purpose-built to help IP managers, patent analysts and R&D leaders discover the full business value of their patent portfolios with ease.
This capability introduces a globally recognized product taxonomy, enhanced by first-level CPC codes and expanded using Large Language Models (LLMs). This hybrid approach allows for more accurate, scalable and commercially relevant patent classifications.
The key features of our standard product taxonomies integration include:
- AI-driven topic extraction: Using LLMs, we extract key topics from patent titles, abstracts, and Derwent World Patents Index (DWPI) use.
- Automated mapping: These topics are mapped to a globally standardized product taxonomy with confidence scoring, covering many categories across multiple hierarchies.
- Real-time labeling: Patents are tagged with product classifier labels that can be stored in your IP management system (IPMS), enabling dynamic portfolio analysis.
- Comprehensive coverage: Covers over 85m+ patents globally across 109 jurisdictions.
With these features, managers are able to gain a clearer view of how portfolios support business objectives, so you can spot gaps, uncover opportunities and make smarter strategic decisions.
The tool enables users to visualize their patent portfolios by product category, making it easy to forecast costs and assess ROI at the product level. This level of insight is invaluable for anyone managing or analyzing IP portfolios, enabling smarter decisions, clearer strategy alignment and stronger business outcomes.
Why does product-focused classification matter?
The key innovation is the shift from technology-focused to product-focused classification. This matters for several reasons:
- Product categories are easier for non-technical stakeholders to understand and act on.
- Products are tied to income, making it easier to assess the financial impact of IP.
- Product-based views help align R&D, legal, and business teams around shared goals.
Our taxonomy is not only intuitive, but also objective, scalable and validated. With over 90% accuracy in domains like personal care, healthcare, software, electronics, and chemicals, it provides a reliable foundation for strategic decision-making.
With over 5,000 product categories across different levels and spanning industries from personal care to aerospace, our taxonomy on IPfolio provides the granularity for making informed decisions.
Real-world impact: Turning insight into action
We’ve effectively assessed large portfolios in pharma, aerospace, software and electronics industries. Customers can attach the generated labels to their portfolios and use them as a dimension to classify their data in multiple perspectives, such as:
- Identify underutilized patents
- Align R&D endeavors with product strategies
- Justify IP investments through clear ROI metrics.
Ready to maximize the ROI of your IP?
Clarivate’s standard product taxonomy is a strategic tool that can transform how IP teams and business leaders perceive their portfolios.
By connecting patents to products with AI, we help you discover the full value of your IP and drive smarter, faster and more aligned decisions across your organization and shift your perspective from being a cost center to a value creator.
Ready to maximize the ROI of your IP? Discover how IPfolio and Clarivate’s standardized product taxonomy can transform your IP strategy. Talk to an expert today.
