| Licensing remains as one the most exciting activities of the marketing mix. Many brand owners are waking up to the idea that their brands have a value that can be exploited in areas outside their current existence. The core equities of their brands can be used to raise much-needed additional revenue which can contribute directly to their bottom-line.
In 2004 the worldwide licensing industry was worth approximately $170bn at retail, with the USA generating approximately $110bn (approximately $5.805bn in royalties) and Europe $34bn. (Sources: EPM Communications for retail and LIMA for royalty information). In the UK brand licensing industry is worth around £7billion at retail in the UK and £368m in royalties. (Source: Licensingpages, with reference to LIMA and EPM figures)
Overall the size of the licensing industry has remained fairly static over the last 5 years, growing just 0.7% in the US 2004 vs 2003. Within this, character and entertainment licensing makes up the bulk of activity with around 44% of the market; corporate brands & trademarks make up roughly 18.5%; sport 13.6%, fashion 13.93%, collegiate 3.4%, art 2.91%. (Source: LIMA)
There have been shifts within the industry. Noticeably character and entertainment licenses have declined slightly with art, corporate and personality brands growing significantly.
The key indicator is what is in retail. It would appear that retailers are concentrating on the brands that are tried and tested and will provide solid sales. These are being ‘topped up by promotional licenses, for instance around blockbuster movies. Retailers are more frequently launching their own brands.
The days of label-slapping are over and licensed products need to be high quality. Licensors need to become more adaptable at exploiting niche opportunities as they arise.
Go to:
What is Licensing?
Types of Licensing
Licensing Processes
Licensing Terminology
Sources of Help
| 
