Licensing Out

November 20, 20120 Comments

Licensing In and Out

Licensing IP rights can be a great way to build a business, either by licensing out your existing IP to other product or service companies, or to expand or promote your products and services by exploiting the popularity of other’s IP (otherwise known as Licensing in).

This month, we’ll review the 3 key benefits of licensing out your IP:

Licensing Fees: Licensing out IP rights (such as brands, designs, artworks or technologies) to other companies can generate lucrative license fees and royalties. Some examples of licensing out include major consumer brands such as automotive (i.e. GM, Ford) and Beverage (i.e. Coke) companies, who license the rights to their brands for a variety of non-competitive product categories (apparel, toys, etc). Licensees of these brands typically pay royalties in the range of 5% – 10%.

Marketing Tool: Licensing increases the licensor’s brand exposure, and leads the IP into new markets. Sports franchises license the team logos into a variety of product categories, expanding their fan base reach through a variety of products such as t-shirts, hats, and collectible products.

Attract Sponsorships: Licensing can also be an effective tool to attract sponsorship for special events, as it strengthens the association between the sponsor’s brand and the event. Some examples include football matches, art exhibitions, music concerts, benefit dinners, and other type of events that license sponsors to manufacture and sell merchandise that bears the event’s trademark or symbol.

Filed in: Strategy
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About the Author ()

Rand is President / CEO of Licensing Consulting Group, an intellectual property management and licensing company specializing in assisting clients in IP Management, Strategic Consulting, Acquisition of Licensing Rights, and Property Representation. Rand has licensed some of the biggest Hollywood blockbusters, including “Batman” and the “Mighty Morphin Power Rangers”, both of which generated billions of dollars in worldwide merchandise sales. He has lead various international licensing programs as both licensee and licensor, and through consulting projects focused on licensing strategy, brand development, sponsorship sales and property representation.

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