Licensing lessons at Showtime
July 26, 2004,
Licensing — it's not all beer and skittles.
And each side of the licensing scenario has different approaches and expectations, ranging from product to distribution challenges.
But for the more successful of the programs, a straightforward contract, close communication, and understanding the goals at the front-end are key elements to success.
These were the conclusions identified by a roundtable panel during Showtime, sponsored by the International Textile Market Association.
Panel members for "Licensing: Brand Building or Gimmick?" were Megan Gunn, senior licensing manager for Waverly; Andy Pacuk, senior vice president, The Robert Allen Group; Scott Ballard, vice president, sales, Lexington Home Brands; Rob Casey, vice president, Ralph Lauren Home at Henredon; and Joie Wilson of Marketplace, a licensing agency. Carole Sloan, founding editor-in-chief of Home Textiles Today, was the moderator.
One key element, the licensees agreed, was that the brand or license knew better than they what the image should be.
Said Ballard, "It would be foolish to think we can do Nautica better than David Chu. But there has to be a lot of give and take, and occasionally there will be lines drawn in the sand."
From a licensor's perspective, Gunn said that Waverly, with some 50 licensees, "looks at each relationship as different and unique. We are partnering with a specialist in that particular business." And for Waverly, those businesses run the gamut from home textiles and furniture to paints and publishing.
And in terms of the distribution challenges, Gunn observed that Target, the licensee in the discount department store segment, works from the company's archives, while new product is distributed among other channels.
Brand message is key to licensing success, said Wilson who represents the "Antiques Road Show" TV program. With an audience of that dimension, she noted, there is immediate identification with the product.
But as the distribution challenge becomes more acute, licensors are challenged in terms of with whom and how they ally themselves. Discussing the Ralph Lauren Home perspective, Casey noted, "They have different silos, and it is a collaborative effort in resolving these issues."
For Lexington, "We have a multi-tier approach, and we are pushing our independent retailer base upwards. We're opening distribution by points of view by license." Lexington's licensees include Bob Timberlake, Tommy Bahama, Nautica, Waverly, and Liz Claiborne.
Distribution and product design also are interrelated, said Casey. At Ralph Lauren Home, which is known for its minute oversight of all product, "We're more push than pull. If we get them focused on royalty revenue potential within reason, it becomes less dogmatic."
And as the Ralph Lauren Home concept evolves, "There is dedicated distribution for the Polo stores and the department stores." And in the furniture world, there also are the specific high-end furniture stores, he said.
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