Brand licensing is the act of allowing another company to use your name, graphics, images, and products in conjunction with its own. As a result, you gain royalties and open up a new revenue stream. Organizations benefit from this in several ways without the effort and financial risk it traditionally involves. Below, we discuss the most important criteria to consider when you choose a brand licensing partner.
Find the Right Audience
A vital factor is to have a similar audience. You need to have demographics that roughly correlate, or that at least overlap. It would be pointless to have a product aimed at the senior age group and team up with products that target the younger generation. Only in extreme circumstances should you consider this and only if you have done the right market research.
More suited would be a partner that creates products that are similar but serve different purposes. For example, a sunblock brand may team up with the manufacturers of shades, or a well-known clothing brand may team up with a perfumery.
You may also find a shared audience in unexpected places. A great example of this can be found in the iGaming sector. Here, online slots for real money often use licenses from many well-loved movies, games, and TV shows to entice customers into something they may not have been exposed to before. These machines have been around since 1887 and over the past two decades have grown to a billion-dollar industry. Properties as wide-ranging as Ellen DeGeneres to Hasbro’s Monopoly are using their images and designs to open up new revenue streams in a flourishing industry.
Find Partners That Utilize Emotion
Another way to find a great brand licensing partner is to find one that has a high emotional connection to its customers. More than ever, consumers are wanting to connect with a brand. They want to share their mission, views, and ideals. That is why so many products that have used this for many years have done so well.
Take the Marshall amplifier brand as an example. A manufacturer of amplifiers, you would assume their target audience is only musicians. Yet their logo can be found on a variety of products, from speaker systems to clothing and more. This is because they encapsulate an emotion, one of a rock and rebellion aesthetic.
By tying into a brand that has a similar emotional connection, you will piggyback their audience. Not only that, but the brand partnership is much more likely to work. A range of Marshall bathroom cleaning products would be doomed to failure, but in-house smart speaker systems aimed at aging rockers would not be at all.
Have the Same Objectives
Having the same objectives does not mean you must have the same business goals. However, you can use licensing to do a lot of the work for you. If you find a company with the same direction, then let them license your image and forge ahead. Thinking of creating a new product line? Let a brand partner do the groundwork for you. Are you thinking of going into a new geographical market? Let a brand partner do it for you.
Of course, all this will take a lot of market research and consultation. But with the right partner, you will soon find a new revenue stream opened up and extra profit flowing in.