As a brand, picking the right licensee is imperative to your overall strategy. Whether you partner with a large retailer like Target, or go with a smaller, local licensee, determining the right fit for your brand requires one, knowing your brand’s wants and needs, and two, asking the right questions.
Licensing Expo spoke with intellectual property expert Tatiana J. Whytelord. With 30 years’ experience, brands like BMW, Gucci, LVMH and Courvoisier have all turned to branding expert and lawyer Whytelord to plan and execute lucrative business deals. NAPW's 2015 Professional Woman of the Year, Whytelord teaches established brands, small business owners and entrepreneurs how to increase their profit margins using their existing ideas, products and/or services.
“We are strategists,” Whytelord says of her role in the licensing process. “Strategy is fundamental in any brand development, licensing or otherwise.”
So what are the questions to ask a potential licensee?
For starters, according to Whytelord, brands need to decipher if the potential licensee interested in the brand is a well-known, large outfit or a smaller, more regional business.
If the licensee is not as well known and smaller, these are some of the questions to ask at the outset:
What other brands do you represent?
What kinds of products do you sell?
Where do you distribute products—in what channels?
What are the price points?
Where are your products sold, locally or internationally?
How long have you been in existence?
For licensees that are a more familiar entity, the questions vary a bit:
Where in your portfolio would my brand fit?
How would it compare to your already existing brands?
Do you have brands at a similar price point?
Will the product be rolling out in some stores locally or perhaps more widespread to all existing branches?
How much attention will you give my brand, in other words, how many resources will be behind it?
Do you see this as a short-term exclusive product, or are you looking for a longer-term commitment?
In addition, Whytelord says there are questions that brands should always ask a potential licensee, of any size:
What is the size of your licensing operations?
How many licensing brands do you have?
What is the annual turnover of licensed products?
How many people, in terms of resources, are you going to put on my brand?
What is your incremental growth rate and annual sales rate so that I can gauge how it compares to my goals for my own property?
“These are important conversations for a brand to have with a retailer or manufacturer to determine if they are the right fit,” says Whytelord. “This goes back to how important strategy is. You need to know exactly how you want your products sold, and where, what is the look and feel, and what stores will be associated with it. If you don’t know that, all of those numbers are great but they won’t give you good clarity on where to go.”
For more information, visit Intelligent Brand Extension at www.ibrandx.com.