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When implemented strategically, expanding the brand through licensing is a proven growth strategy. Brand licensing enables:

1. Brand managers to expand their brands with minimal investment. The license agreement means that third party manufacturers are responsible for everything from product development to inventory management and replenishment.

2. The brand for additional marketing support. For the right to use the trademark in its category, the manufacturer must agree to spend a percentage of its net sales on marketing. This marketing commitment not only supports the licensed category, but can also be significant to the overall brand.

3. Trademark protection in the category. In order for a brand to benefit from trademark protection in a certain category, it must be actively sold in that category. If the category is free, others can claim rights to use the trademark. By expanding a trademark into a category through licensing, trademark owners can meet the commercial standard.

4. Improved customer relationships and insights into the licensed categories. Expanding a brand through licensing offers thousands of additional ways to connect with consumers. By including a survey on the license package or a toll-free number on the outside, a brand owner can gain a lot of additional brand insights.

5. A brand to gain additional shelf space. When a brand owner expands a brand into a new category through licensing, the brand gains tremendous additional presence in those categories in every retail store that sells the product. When selling to large retail chains, the brand can gain thousands of feet of brand awareness in each category.

6. Entry into new sales channels. By licensing the brand to a manufacturer who is currently selling to a retail channel where the brand is not currently present, the brand can gain access to that channel through the licensing relationship.

7. The brand to enter new regions. Similar to accessing new channels, a brand can gain access to new regions through a manufacturer who is present in regions where the brand is not currently sold.

8. Access to patented technology. Many companies that choose to license brands offer proprietary innovations to the brand owner. If the patented technology strengthens the brand's position, the new product can be met with tremendous consumer appreciation and pent-up demand.

9. Knowledge transfer from the manufacturing partners who license the brand. A license agreement gives the brand owner and manufacturer the opportunity to exchange insights and knowledge across different disciplines, including product development, marketing, research and development, and sales.

10. The trademark owner to obtain royalties from the sale of licensed products by the manufacturer. This symbiotic relationship helps create new products for the market that consumers crave. For every US dollar sales made by the manufacturer, the brand owner receives a percentage of royalties, most of which flow directly into the profit zone.

The Blake Project Can Help: We offer brand licensing workshops to help brand owners develop a strategy for licensing or improve an existing one. Another way to serve our customers is through a Brand Licensing Audit, which is an essential guide to reviewing, building and / or improving a licensing program. Please email us for more.

Brand Strategy Insider is a service from The Blake Project: A strategic brand consultancy specializing in brand research, brand strategy, brand growth and branding

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