Eight ways for licensees to land those major agreements.
1. Step Up To The Plate In Financial Terms
Be prudent and consider the downsides. But at the end of the day you will not win a hot licence without a seriously motivating financial proposition.
Where you are in a competitive situation, you are going to need to be ballsy if you want to win. For sure, you need to allow for the fact that many licences, even on major brands, don’t work for merchandising or for particular categories, but you won’t get something many other companies want without outlaying sizeable minimum guarantees.
2. Look Beyond The Financials – What Does The Licensor Really Want/Need?
There are many other factors you need to consider beyond the financials. The licensor may need one big win to set the ball rolling, they may need help resolving internal political issues, they may have particular competitors of yours they don’t want to work with (for whatever reason).
But if you just roll up, open your cheque book and start bidding you will be seriously missing a trick. Engage with the licensing team and find out what else is driving them beyond the money.
3. Understand The Licensor’s Process, And Who Has Ultimate Veto
Many’s the time that we, like many others, have flailed away trying to convince someone who didn’t need convincing. Most licensors have their own internal stakeholders to convince. Sometimes they are senior management, sometimes they are third parties and sometimes they are creative/production teams. In our experience, this latter group can and often do kill obvious and potentially lucrative commercial opportunities on the flimsiest of grounds.
The best way to get your deal through is to prompt and persuade the licensing contact to put you face to face with their key stakeholders/gatekeepers on the brand you want to work with. Influencing them face to face is much more powerful than doing it via your main contact as conduit. This generally will deliver better results for you and for your main contact.
4.Show PASSION (where appropriate)
We don’t mean for the licensing team themselves (although we’re sure that’s happened before), clearly we’re referring to passion for the brand.
We can’t articulate enough how important it is to be able to express genuine passion, interest and enthusiasm in/for the brand you are pitching for rights on.
Enthusiasm and a clear emotional driver to work on the brand will influence decisions. Regardless of the fact that you or your competitors will hand over the opportunity to a similiarly cynical and wizened sales team, the thought that somebody ‘cares’ at a particular company is normally highly motivating.
5. Be Aware Of Your Own Weaknesses, Be Even More Aware Of Your Perceived Weaknesses
Your credibility is important. The licensor needs to know that your company will do a good job. If you are obviously lacking in some particular area, you are much less likely to be granted rights. For instance, if you’ve asked for rights on a category you’ve not worked with or don’t have a track record in, you need to proactively address this, otherwise the licensor might not believe you know what you’re doing.
6. Make Life Easier For The Licensor
Bear in mind the licensing model versus the publisher/manufacturer model. In Licensing, revenue = c. 10 per cent of sales versus your 90 per cent. The implication of this means most licensors have to run a lot of licence agreements with a lot of companies with comparatively few staff in order to make the numbers work.
Seriously, we’ve won major deals because the licensor had bigger fish to fry and we were an easy tick in the box. If it helps the licensor get the deal done and saves them duplication, fill in forms for them, add a credible pitch for an adjoining category etc.
7. The Best Licensor Is A Repeat Licensor
The easiest licences you will ever win are from those who have already granted you a licence… but only if you have a) done a half way to decent job, b) communicated status and updates well, c) paid on time and d) helped your licensing contact manage their own internal processes. I.e. You've jumped through hoops for the quarterly updates and other points of process many licensors have to compile.
8. Don’t Be Shy In Seeking Expert Licensing Assistance
Expert knowledge can save you money. Frankly, this tip is a thinly disguised plug for our services, but whether it’s us or another company, you can get severly burnt in this area if you don’t know what you are doing. Yes you might have to pay for assistance, but experience suggests that learning by doing can prove much more expensive in this space.
If you're a licensor, you can also read this guide: Seven ways to pick the right licensees.
About the author
Steve Reece runs Virtual World Licensing, a brand consultancy whose mission is to facilitate offline commercialisation of virtual worlds. You can find out more or get in touch at www.VirtualWorldLicensing.com
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