Licensing converts IP into money-making opportunities. Look around, and you’ll find just about every product, service, and technology today is somebody’s intellectual property. And in many cases, licensing is the strategy used to get it into the market. But that’s just the tip of the iceberg when it comes to licensing. Here’s four of the top ways licensing creates money-making opportunities.
Licensing is one of the fastest ways to reach the commercial market. It’s considerably faster than starting and building a new business which typically takes about 18 months to 2 years. Licensing takes a much shorter time frame, often just a few months instead of years. Whether it’s electronics, toys, T-shirts, or hats, licensing is a quick and powerful way to “plug” into a partner already operating in one or more of your markets.
Licensing is a fast way to get new market-ready products, services or technology. Tapping into the” R&D expertise” of an IP inventor is a lower cost way to develop new products. The biggest advantages include completed R&D, product testing, and in many cases, sales at some level. Some sources to find market ready IP include licensing agents, IP databases (such as yet2.com), patent databases (such as USPTO.gov), corporations and universities.
Established brands looking to expand their market presence offer great licensing opportunities and are a lower risk way to launch a new product. One of my clients used this strategy to get into the US market. Instead of trying to build their own toy brand, we licensed several well-known kids TV shows. Plus they got immediate access to retailers selling other licensed products. They launched into the US market faster and at a lower cost than building their own brand.
The internet is creating new licensing opportunities. Social media, virtual worlds, and digital content are just some of the rapidly growing opportunities. Many of the biggest kid’s social media sites, such as Club Penguin, are licensing a variety of products with their characters. Virtual worlds are licensing virtual products that sell both “in-world” and online. And published content licensing, such as photographs, is exploding as production-on-demand technologies enable customized products.
New markets and demands are popping up every day. Whether licensing in or out, it’s a fast way to enter the marketplace, create new products, and capitalize on these money-making opportunities.