Now almost one decade later, as a licensing agent, I have had the opportunity to put all of my past experiences and education into my work.
I first started licensing in 1996 by establishing Twitch Speed Enterprises. The name was meant to generate attention, as I mostly worked with entertainment properties and primarily in the childrenís segment. Last year, we re-launched with a new name, Quadvia Equity Development Group, to signal our shift of focus to representing corporate brands.
The new name reflects the foundation of our methodology and our approach to licensing as a form of equity development. Quadvia is Latin for a place where four roads meet, and the name abbreviates to QED, again from the Latin, quod erat demonstrandum Ė that which is demonstrated or, put more simply, proven.
The four roads in this case are the four key stakeholders in a licensing program: the Licensor (the brand owner) the licensing agent, the licensees (the manufacturers) and the retailers.
To successfully navigate the licensing process, one needs to involve each party and obtain senior level commitment. You canít have a product without a brand owner. You canít manufacturer a product without the licensee. You canít sell your product without a retailer. And you shouldnít negotiate a deal without the experienced guidance of a licensing agent and trademark attorney to ensure that the result is good for the long-term goals of the brand.
A good example of the importance of licensing deals is to look at the American discount retailer, Kmart, which is presently restructuring to avoid bankruptcy. Kmartís recent court request to pay its minimum guarantees on licensed product sales is a reflection of how highly Kmart rates its relationship with its brand partners. Rather than ask for more money to pay for advertising or hold a major sale, Kmart wanted to put the money toward shoring up its alliances with the licensed brands it sells.
As a licensing agent, itís my job to advise my clients on how best to position a brand so that it holds the same level of importance at a retailer as those at Kmart. Thatís why the retailer is considered a key player in our methodology.
Licensing should be considered by a company when it wants to build or leverage its brand equity, generate or diversify revenue streams, differentiate from the competition, enter new markets or businesses, protect trademarks, or enhance shareholder confidence.
For instance, letís look at a brand like Krispy Kreme. Analysts have been declaring its stock is too high and will have to drop soon. Indeed, sugary dough canít continue to rise forever. So in this case, I might recommend diversification into other products. Depending on their brand strategy, Krispy Kreme could perhaps move into frozen or refrigerated foods, candy, toys. This would bring new opportunities to reach a larger audience. Also if the bottom fell out of doughnuts, there would be some other related product to carry the brand.
Of course itís necessary to really study the brand and the market to arrive at an informed recommendation. Thatís where my background comes in handy.
Following grad school, I started a mail-order and internet catalog business for petite women. Thatís when I discovered the beautiful world of licensing. I generated more money from licensing the brand and mailing list than from actual product sales. The idea that you could build something and continually generate money from it was quite a revelation. So I started to self-educate on licensing and after awhile I sold the mail-order business and got into licensing full time.
One of my first clients was the holder of the merchandising rights for the legendary hero Paul Bunyan. My client was interested in licensing his rights for lumberjack shirts and other apparel. To make the most of our merchandising possibilities, I suggested that we first needed to reintroduce the character to our collective memory. We partnered with Artists Management Group to negotiate a book deal with Simon & Schuster. We are now promoting the book manuscript to movie studios. Once a book and a movie are out, the mark will be much more valuable as a long-term revenue generator to our client and prospective licensees.
I donít believe in sucking a brand dry for short-term profits. Rather, I am interested in building sustainable licensing programs that continue to build the value of the brand over the long-term. That may mean a longer ramp up time to roll out licensed product.
My first area of concentration when representing a client is to understand their corporate mission and goals, their business model, and the corporate structure. What is the brand definition and how does it generate revenue? Who is the target market for the brand and what is it trying to communicate to its consumer? You have to understand these fundamental elements to be a successful agent. It helps to be brand focused as a licensing agent. Itís crucial that licensed product naturally extend from the brand equity and complement the brand identity.
The skills I use in this job are mostly brand strategy related, combined with an understanding of corporate business models and the creativity to arrive at ideas for extended product categories. I spend a lot of time researching markets and drawing on my studies to help me think clearly and arrive at long-term solutions.Ē