Let’s start with the worst kind of example, licensing as a non-strategic, opportunistic tactic whose primary purpose is (perhaps) protecting against trademark infringement while generating royalties. While many would hope that such an approach was outdated, a quick wander down these aisles will prove that in too many cases it is still alive and well. Completely transactional in focus, this approach to licensing is the purview of lawyers and agents (as well as the intellectual property owners themselves) of the “Let’s Make A Deal… Any Deal” variety. Furthermore, this approach is scattershot and does little for a brand, except for slapping its most valuable asset—its trademarks—on products that will be short-lived (if they live at all), with little connection to the brand’s equity and which do not resonate with the consumer as anything more than decoration.

Such thoughtless executions are among the reasons that trademark licensing is below the radar of many (but not all) chief marketing officers and brand managers. Of course, this is not surprising given the lack of inspiration that characterizes these kinds of licensing programs. After all, today’s chief marketing officers have a lot on their plates. Not only are they constantly under threat of losing their jobs (according to an annual survey by SpencerStuart, the average tenure for a CMO at the top 100 consumer-branded company is 23 months), but they have to successfully reach consumers who are increasingly adept at declining brands’ offers to participate in their lives.

Frankly, it’s enough to make you want to run and hide. But if you are lucky, you will run and take refuge in one of the aisles that showcases products with more exemplary approaches to brand licensing today. That’s where you’ll find sophisticated and savvy marketers who have already learned that in today’s fragmented media marketplace, strategic brand extension licensing is among the most authentic and credible forms of buzz marketing and, therefore, an integral part of the marketing mix for today’s most innovative brands.

Licensing as buzz? Yes, when the licensing program matches or extends a brand to products so authentically that the brand enters consumers’ lives in ways that are unpredictable, but completely natural. If done properly, a consumer will have such a meaningful experience with the brand that they can’t resist sharing it with others. It’s the retail form of human media or user-generated content—authentic, relevant, and person-to-person. But unlike the more common notions of buzz, which are often fleeting, risky and not targeted, licensing-generated buzz can be long-term, controlled and highly-targeted.

In addition to driving increased buzz or word of mouth, a smart brand extension strategy also increases awareness among a brand’s core audience and attracts new audiences, inspires loyalty and even generates revenue for the brand. In fact, according to The Licensing Letter, licensed products account for more than $12 million in retail sales per hour.

Take, for example, the Jaguar pen brand extension. Designed by Jaguar’s own auto designers, but manufactured and sold under a license, the pens are sleek, high-end writing instruments that are reminiscent—in design at least—of the Jaguar automobile. Available at luxury retailers in Europe, the pens allow consumers to experience the Jaguar brand in an entirely new but credible way—shifting from the highway or the showroom to the high street and the boardroom. Every time a consumer uses it in front of friends or colleagues, he or she generates a “human media impression” and more importantly offers an implicit endorsement of the Jaguar brand. Is there anything more authentic? The program has been so successful that Jaguar is moving into luxuriously designed home furnishings, another logical, authentic, and on-brand extension.

Are there risks associated with licensing-generated buzz? Yes, but the risks are completely different than those normally associated with buzz programs. The risk inherent in any licensing or brand extension is in not doing it right. At the end of the day any brand’s most important asset is the brand itself, and executing a shoddy or unsuccessful program can have negative repercussions that go beyond simply having an unsuccessful licensed product pulled from retailers’ shelves. But those risks can be navigated and mitigated if licensing is approached correctly.

Before executing any licensing program it is important to not only identify your brand’s leverageable equities (tangible and intangible), but to conduct the proper due diligence you would perform before entering into any new marketplace or launching any new product. This includes evaluating the competitive landscape for each potential licensed product category, understanding the market dynamics and retail needs in the targeted categories, and gauging the ease of entry and the financial attractiveness of the potential licensed product categories.

As many people lament the alleged end of brand marketing as we currently know it, I prefer to think we are at the beginning of a new chapter, a golden age if you will, where licensing-generated buzz will prove to be the most creative and effective form of marketing in a marketing-saturated society.