The usage of licensing as the brand extension tool and marketing has boomed
over the last three decades. When skillfully executed, an adept licensing association
brings profits to all parties to the deal – be it the property owners and their
mediators, licensees and their colleagues, retailers and, eventually, end users.
Each of those affiliates has its own aims and goals that finally adding value
to the final service or product.
To maximize the outcome, each member in the licensing development has definite
accountabilities to fulfill. Every contract between the licensing parties is exceptional
in its particulars, so even these duties vary to some degree.
Licensors
There are several aims for an intellectual property (IP) owner to permit
a license. The most obvious one is to make profits from the guarantee and
royalty payments. But licensing also can cater a number of other purposes. In
some cases, those “supplementary” reasons to license might in fact be more significant
to the licensor than the sheer amount that is earned. Ponder the following
amongst them:
Marketing support for the core business in many ways like a movie,
television show, sports franchise or simply children’s merchandise that the
retail display and propagation of these and other licensed products not only
generate commodity sales but also helps promoting the core property. Say for instance that any toy
or apparel linked to a movie benefits movie promotion whereas sports fan
wearing any sweatshirt with their favourite team logo expressing
their passion for the team, in turn promoting the sports, team or league to by-passers.
Ranging a corporate brand into different classifications, locations of a
store, or into novel stores overall. Licensing signifies a way to move a
brand into new businesses without making a foremost investment in new
manufacturing developments, machinery or facilities eventually reaping the
benefit in royalties, but also in exposure in new channels or store aisles.
Retaining control over an original creation Licensing signifies a
way for artists and designers to payback from their innovative efforts, while keeping
up control over how they are used. For brand owners mainly those doing business
in the universal marketplace, licensing and registering the brands in numerous
markets are a way to safeguard the brand from being used by others without approval.
Licensees
Licensees lease the rights to a definite property for incorporation into
their produce, but conventionally they do not share proprietorship in it. However,
licensing provides a number of essential functions to them. Acquiring the
consumer awareness and marketing profits of a well-known brand, character,
logo, design, etc. The most noticeable advantage to a manufacturer or
service provider the licenses a brand, character, design or other portion of
intellectual property is the marketing influence it brings to the product.
Agents
and Consultants
Licensors often retain licensing representatives or licensing firms to accomplish
their licensing programs. These agents undertake duties for their clients such
as agreement negotiations or the product endorsement processes. In return the
experts receive a certain percentage of all royalty revenues. For the licensor
the benefit of engaging licensing professionals involves their expertise and
network of connections. The licensor also evaluates the cost of the advisor against
the cost and time require in building up an in-house licensing division to
handle business.
Manufacturers, on the other hand, may employ a licensing specialist
whose duties are corresponding from the other side to those of the licensing representative.
The licensing expert backs up the manufacturers who are mainly associated in licensing, but who do not have internal work forces to
handle the business. It is the professional’s accountability to signify
manufacturers in their licensing activities, comprising the assessment of
properties, the inspection of their availability or the expansion and
implementation of licensing policies. The terms under which licensing companies are paid vary comprehensively,
but the foremost percentage is paid in commissions derived from product sales.
