1 GSOH is essential
Licensing is about selling or buying the rights to use images, brands, characters or logos (otherwise known as ‘properties’) on consumer products. The most successful properties are those that have emotional resonance for consumers, such as a funny character, a nostalgic image, a powerful brand or a sports logo.
2 Hone your pitch
Products need to have online and offline appeal. You will be pitching your concept to retailers – how will your product stand out on their shelves? How will you be supporting sales and developing your range in the future?
3 Do some reading
There are plenty of specialist trade magazines and websites in the licensing area offering news, advice, events and business leads.
4 Get personal
For a great start, go to Brand Licensing Europe in October (Olympia) – the largest annual European trade show in licensing. Get along to a networking event, take advantage of social media forums and the trade association, Licensing Industry Merchandisers’ Association (LIMA).
5 Consult the experts
It’s worth bringing in an expert to help find your licensing partners and negotiate deals. A licensing agent will handle all commercial aspects from sales to collecting your royalties - they work with intellectual property rather in the way that an estate agent handles bricks-and-mortar property.
6 Decide on the right partners
Licensing is a long-term activity, so the chemistry has to be right between you and any potential partners. Agree terms of business – and put an approval process in place from the start, so you retain creative control. Manufacturers will be making a significant financial commitment, so you need to feel comfortable from the start.
7 Agree a product range
You need to be comfortable that the product range is appropriate to your brand and vision as well as having sales-appeal.
8 The world is your oyster
Many UK companies have built their export strategy via international licensing.
9 Calculate royalties
These are based on a percentage of the value of each sale. Minimum guarantees and advances are also normal.
10 Keep monitoring
Like any business activity, licensing works best when you keep reviewing, learning from mistakes, developing new plans and taking inspiration from success.
Kelvyn Gardner is UK Managing Director of the International Licensing Industry Merchandisers’ Association (LIMA).