“We’d be extremely interested if you have a retailer lined up.”

I hear it half a dozen times a month. It's a fair request. A licensee, unsure of a brand’s potential, would be swayed to join a licensing program if the uncertainty of retail placement was eliminated. If I were in the prospect’s shoes, I might say the same.

Unfortunately, having a ready retail partner at hand is more the exception than the rule.

In a traditional licensing relationship, the licensor or brand owner grants the use of intellectual property (trademark, trade dress, characters, etc.) to a licensee who in turn is responsible for developing product, securing retail placement, marketing to trade and consumers, fulfilling shipments and much more. In return, licensees generally take more than 90 percent of sales revenue.

That's the traditional model. The model has been changing.

For reasons we all know too well, the retail landscape has been a challenging environment, and there doesn’t seem to be a change of course due any time soon. Taking on a license has always been a bit of a risk. These days, people are finding themselves more and more risk adverse.

To navigate this adverse scenario, it is increasingly in a licensor's best interest to provide a licensee as much added value as reasonably possible. On top of the list: retail assistance. You may not be able to guarantee shelf placement, but you may be able to meet licensees part way.

Connecting the Right People

One significant resource a brand owner can provide is established retail relationships. This can come in the form of making introductions or whispering in the right division merchandise manager’s ear. Let's say you are a brand manager of a successful household vacuum cleaner. For argument’s sake, let’s call it Enchanted Rug Cleaner and assume it's widely available at mass and big box hardware.

To help grow revenue, you've begun reaching out to cleaning chemical companies to find a partner who wants to leverage your brand name for rug and upholstery cleaners. You've found a great prospect, but their existing business has been largely at hardware. They don't know anyone at mass.

You are not in a position to promise retail placement at Walmart, but you can certainly make introductions. In this example, you are probably in the same aisle dealing with the same buyers. This may be the final push that helps the licensee sign on the dotted line. More importantly, it can also translate into additional and meaningful retail placement

You might be thinking, “No kidding. This is obvious. Who wouldn’t play matchmaker to the likes of a Walmart?” Yet, what if we were talking about supermarket chain BI-LO? Are you leveraging all of your meaningful retail connections? For clients who are already in the consumer product space, I ask for a list of top 25 accounts. Every account is a potential revenue stream.

For top retail targets, I also ask to make introductions between my clients’ sales teams and relevant licensees. Enchanted Rug Cleaner’s sales team for Meijer can offer more than introductions. They can share what and when Meijer’s big promotional periods are. They can tell the licensee about the current dynamics of the cleaning solution category. They can share insights into buyers’ personalities. You may, in fact, want to have a representative of the sales team at the retailer meeting. It’s tantamount to an endorsement of both licensee and product.

Sharing Research and Sales Know-How
What if you do not sell products in the same aisle or even the same channel? What if it’s a completely different type of product? What if they are not a consumer products brand?

Let’s say Enchanted Rug Cleaner’s licensee wants help entering the auto parts channel. There is white space in upholstery cleaning that they think they can capture. Enchanted Rug Cleaner has no presence there. What can you offer? Well, actually, a lot.

Most licensees are not as sophisticated as their licensors (there’s a reason that the licensor’s brand is what it is). You can use your experience to help make an extremely compelling sales deck or retailer presentation. You probably have access to research that your licensee doesn’t. This always makes a pitch significantly more compelling. And, as in the prior instance, you have your brand’s authority. You can offer to join key meetings. Your presence provides a halo effect to the licensee.

If you’re a non-consumer products brand, you may still have meaningful resources you can offer in the form of retailer assistance. Do you have advertisers? If so, are any good retailers in the mix? Do other departments in your organization have retail relationships that they can leverage? I’ve worked with non-profits and children’s brands that partner with retailers for joint initiatives. Some of these relationships can be leveraged (others that are purely philanthropic in nature, maybe not).

The licensing landscape is evolving, and the savviest licensors are providing added value to everyone’s benefit. Do you have any other examples of how to creatively lend a hand to licensees?

If you liked this post, check out:
4 Reasons Why Magazines Make the Perfect Licensing Platform