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Survivor's Guide to Licensing

What are the keys to surviving the recession? License! Global pools its wisdom with some of the best in the industry for this 10-point guide to managing hard times. 1. CONFIDENCEConfidence is everything&#8212

April 6, 2018

5 Min Read

What are the keys to surviving the recession? License! Global pools its wisdom with some of the best in the industry for this 10-point guide to managing hard times.

1. CONFIDENCE

Confidence is everything—lack of it has taken the economies of the world down, and confidence is what will bring the world out of recession. More people will stay employed than will lose their jobs, and once the shock of the situation subsides, they will shop.

2. COSTS

Batten down the hatches. The recession is an opportunity to look at your cost base and to become a more efficient and effective business. Use technology to enable the business process to become more proficient.

3. IDEAS

This is the time to be entrepreneurial and creative and to take some risks. Great ideas can really take off in down markets—but it takes double the determination to be a winner. It's all about coming out of the corner fighting.

4. CASH

Businesses fail because they run out of cash, not because they do not make profits. Make sure the cash-flow position is well looked after.

5. MARKETING

Facing the reality of pruned budgets means that marketing has to combine advertising with other activities—sponsorship and events, for example—that maximize the bang for the buck. Look at new media and viral activity. Put new focus on press and PR, making sure that it is targeted and is reaching the right market.

6. PORTFOLIO

Take a good, hard look at the brand portfolio. Which are the performers, the core properties and the peripherals? Where are the synergies across the brand portfolio? If the weakest brands and properties have the least synergies, this may be the right time to put them into storage—or sell them, if that makes more sense.

7. TRUST

Build trust with consumers. Ensure that your brands deliver what they promise by strictly applying the core brand values across all product extensions, regardless of market positioning. The relationship between a brand and a consumer is emotional—do not upset the balance.

8. VALUE YOUR PEOPLE

A time of recession is not just about cost cutting but about making the most of what you have. Value experience and knowledge as well as enthusiasm and creativity.

9. RELATIONSHIPS

Nurture all the linking relationships among licensors, retailers and licensees. If the working partnership is clearly defined from the start of a contract, it will build respect, maximize the outcomes and avoid resentments building up among different parties. A strong brand with strong delivery to the market equals a strong proposition for consumers.

10. THINK GLOBALLY

Unusually, this recession is global. However, a portfolio balanced across brands and territories gives the greatest opportunities for benefiting from any economic upturns as the markets kick back in around the world.

With thanks to Ian Parsons, chairman of consultancy Retail Performance Improvement

TOP TIPS

Be creative, and don't be afraid to do something new. Push the boundaries. It is such a competitive, cluttered market that people will overtake you if you continue doing something old."

—Mel Beer, head of licensing and content development, HarperCollins U.K.

The most important thing is to work closely with retailers."

—Simon Phillips, president, worldwide consumer products, Marvel

Work with partners who embrace the brand on a global basis."

—Benjamin Morel, vice president, global merchandising group, NBA

Continue to have regular dialogue and interaction with all parties who contribute to the ongoing success of brands: licensees and retailers. We have to listen even more closely than ever before to what they need to deliver results for us all."

—Carl Lumbard, senior vice president and managing director, Twentieth Century Fox L&M, Europe

I do think we're sailing in uncharted waters at the moment, but it is not a time for burying our heads in the sand. Rather, it's the time to be tactical. To start with, we'll be fostering even closer working partnerships with our licensees and retailers, which means listening and sharing information that will enable every party to make good decisions and to make the most of every opportunity as it arises. It's not necessarily a time to stop spending or stop innovating. In fact, in this economic climate, we will ask our favorite evergreen brands to work harder for us than ever before and be prepared to support them all the way. We'll also be bringing on our newer brands—we're launching the merchandise program for iCarly and Wonder Pets!, for example, this spring. But Nickelodeon's strategy is to allow a property plenty of time to become well-established on screen before rolling out licensed merchandise to an existing demand in the market, so we're confident these brands will be well-received, and this is the sort of reassurance that licensees and retailers are looking for at the moment."

—Clare Piggott, vice president, consumer products, Nickelodeon UK

Business should focus on the established properties, relevant consumer stories and retail implementation to maximize the impact. For {Warner Bros. Consumer Products], this includes evergreen animation classics, DC superheroes and the biggest movie franchise ever: Harry Potter. Consumer research has confirmed the critical importance of relevant and compelling consumer brand propositions that go well beyond TV airing but tie in with major underlying consumer trends. We are increasingly looking at ways to maximize the opportunity for retailers to differentiate themselves and develop unique in-store events, increase traffic, sales and margin by implementing more cross-category programs and finally improve their overall image in the market place as 'destination' retailer."

—Bruno Schwobthaler, senior vice president of sales and business development, Warner Bros. Consumer Products, EMEA

Global economic performance affects everyone: licensor, licensee, retailer and obviously consumer. Therefore, as an industry, we have to work harder than ever before. It is my belief that if we deliver bold innovation in products and business models, drive collaboration and find 360-degree solutions that add value to existing relationships and encourage new partnerships, we will accelerate the progression of the licensing industry so that it's always a good place to invest."

—Alan Fenwick, vice president, Turner Enterprises

The perfect storm is more important than ever. You need a great property, great broadcasters and great agents. We are lucky to have all of these with Thumb Wrestling Federation. Every kid already knows thumb wrestling—we are just applying good characters and stories to our own special humor. The kids get it immediately. Our broadcasters—Cartoon Network, BBC and YTV—treat TWF like their own show [in that they] use it as a branding device for their network."

—Larry Schwarz, chief executive officer, Animation Collective

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