Brands such as Thomson TVs, Black & Decker steam irons, Elle handbags and Blaupunkt bluetooth have become profitable in a short span of time through brand licensing, which in turn is a win-win situation for brands, licensees as well as consumers, according to Rishabh Singla, managing partner, LicenseWorks.
Explaining the advantages of brand licensing, Singla said, “It helps a brand, homegrown or international, expand into a new product category, which enables them to reach new consumers and retail points thus helping brand owners extend and maximize their brands’ power and reach.”
For instance, LicenseWorks has worked with Super Plastronics, a manufacturer and marketer of TVs in India, which was looking to grow its business. LicenseWorks has helped the firm to partner with French brand Thomson to launch TVs in India. Similarly, it helped Indian audio firm Envent to partner with German brand Blaupunkt to launch its products in India, which is now one of the bestselling brands in its category, said Singla.
Based in Gurugram, the agency has recently helped the American brand, Sata Barbara Polo Club launch apparel and footwear in India through a retail group. The entire process happens with the help of third parties, who are experts in product categories and they can be either manufacturers or retailers, the company said.
“To launch a new brand is a daunting task, it can take decades to grow one and find a foothold in the market. But licensing enables these third parties to introduce their products under a recognized brand that helps them penetrate in the market, achieve better profitability via higher margins and ramp up sales/market share quickly,” he said.
For brand owners, licensing partnerships are beneficial as they enable them to explore and expand into new product lines, which further helps in expansion of their customer base and growth in brand equity.
For licensees, the partnerships enable them to acquire the rights of a well-known brand, and develop and sell approved products under that brand name across distribution channels. Thus, licensees get immediate traction and are able to scale up their business at a faster pace.
Brand licensing, for consumers, is a mean to engage with their favourite brands through new brand extensions, instead of just being restricted to a limited core product range. This is how a well-executed licensing partnership is a win-win situation for all — brand owners, licensees and, ultimately, consumers, Singla added.
On being asked about how a firm can secure a licence, he said, “to secure the right licensees for a brand owner (licensor), we gauge their credibility on three factors — product development capabilities, distribution capabilities and marketing expertise. We look for partners/licensees who can first develop a strong, high-quality product range consistent with the (licensor’s) brand image and positioning. Secondly, the partner must have a strong distribution and service network. Thirdly, that partner should have the acumen to grow and manage a world-class brand.”
For brand owners
Licensing partnerships are beneficial as they enable them to explore and expand into new product lines, which further helps in expansion of their customer base and growth in brand equity. For licensees, partnerships enable them to acquire the rights of a well-known brand, and develop and sell products