For example if Microsoft Combine Harvesters popped up, it would be relatively straightforward to argue that they are making use of the Microsoft mark for the sole purpose of attracting attention to its product, by effectively piggy-backing on the real Microsoft's reputation.
Proving reputation is difficult but generally you will have to show substantial investment in marketing/advertising in the relevant territories.
If I can't show reputation I am limited to actions for straight infringement (identical mark/identical services/goods) or confusion-based actions (similar mark/similar services/goods).
A good example was the Budweiser v Budvar saga http://en.wikipedia.org/wiki/Budweiser_Budvar_Brewery#Tradem...
Generally, you would hope that the parties could come to an agreement and enter what's known as a co-existence agreement where they just agreed to continue but in some cases agree not to further encroach on each other's markets for example.
The above example just ran and ran with each filing suits around the world, showing the difficulties of deciding who should have sole rights to a name when both have built up substantial goodwill over a long period of time.
Side Note: trademark protection is more focused on protecting consumers than companies - unless the company has spent an excessive amount promoting and selling their products, at which point, they are given special protection/rights.
As bolt.co is claiming, there are many people who appear to be confused between instagram's offering and the company's product (they are arguably in the same space and possibly competitors).