2018 Licensing University Call for Speakers

Do you want to speak at Licensing University™ in Las Vegas next May? Do you have a great session idea? Now is the time to get your proposal together!

The sessions that comprise Licensing University™ cover a broad range of topics impacting the industry in a number of categories, and explore key topics and trends relevant to both newcomers and experienced business people alike.

Though we welcome all submissions and ideas, topics of particular interest for 2018 include:

•             Detailed case studies on product and property introductions and brand extensions
•             Retail strategies and trends
•             Digital marketing strategies
•             Social media strategies
•             Forward-looking sessions on growth categories and market segments
•             Maximizing emerging media platforms
•             Globalization

Licensing University™ is held in conjunction with Licensing Expo each year.  The 2018 program will launch on Monday, May 21 – the day before Expo begins – and continue through Thursday, May 24, the final day of the show.  All Licensing University submissions are due Friday, December 15!

SUBMISSION FORM

Questions? Please contact Marty Brochstein at mbrochstein@licensing.org

Emerging Markets And Brand Licensing by Dave Sharat

dave-sharat
EMERGING MARKETS AND BRAND LICENSING
What benchmarks successful Brand licensing in emerging markets ? Surely there are more than one factor that steers the business, in as much as the several pitfalls that render deals going south. It would be hard to have a consensus on all but here are some that would ring a bell from your own times perhaps.
BITING OFF MORE..
This goes both sides of the fence.. licensors and licensees falling on their own swords. Over zealous expectations from a market and the need for presence in a new market on the one hand and in trying to “win”  the license, the prospective licensee often providing the licensor with a “best case scenario” instead of a more realistic case, on the other, are deterrents. The often hyped initial projections will then form the basis to develop minimum sales targets and royalties, which will then go into the contracts. Trouble looms when both sides agree to just about “any” terms in order to have a “get go” and the inability to achieve the objectives ultimately result in a stalemate. Getting in over one’s head, prospective licensees often try to secure multiple regions or channels as part of the deal. This may be because the licensee really believes it can take full advantage of all of the rights offered and sell its product into each of the channels or regions.
Creating unrealistic expectations also comes when licensees may not fully understand the true strength of the brand whose license they just acquired. The licensee may overestimate the power of the brand, believing the brand alone on their product will result in acquiring new clients or larger programs with existing clients.
Licensors often want the licensee to treat the licensed category with the same care they would treat a product category in their own organization. They expect the licensee to develop the product following the brand’s style guides carefully and to follow externally a similar protocol to the one that the licensor follows internally. The licensor wants the licensed product to be of a quality that the licensor would be proud to have on a retail shelf next to the internal product. Optimizing expectations on both sides is what’s key


DUE DILIGENCE 
The classic and most frequent mistake is to assume that a formula for the licensing or franchising of a brand in one market will work equally well, unamended and unadapted, in another market. There are many examples of brands which are large and successful household names in their home markets but have tried and failed in emerging markets.KFC Vs McDonalds in China, HOME DEPOT closing in China whereas B&Q  flourishing by consistently reading the market better have been highlighted before too. The animated cartoon ‘Little Krishna’ which was a hit on Nickelodeon India is another eg. Bu then to launch a merchandising range featuring bath mats and bedroom slippers was a great mistake: Little Krishna was, after all, still a god and never, ever would you place your feet on an image of a god! The lesson is – selling in a particular market would need understanding the minds of the buying public or the target audience. What works in one part of the world may not work at all in another part of the world.

TRANSCENDING BRAND STRENGTHS 
Assuming the brand is as well known and as highly prized in the local market, as it is at home, is another cry. It is remarkable how deluded senior executives in leading “Western” corporations are about how well-known their brands are in other markets. Even with the advent of the Internet, a brand may simply not be known to large swathes of the population in large parts of the world. As a result, in a negotiation with a potential licensee, the brand owner needs to articulate to the licensee the value proposition that is being brought to the table, and not to assume that this “speaks for itself”. Thus in a market which it plans to develop, a licensor would be well advised to offer additional marketing support and funding in order to assist a potential licensee,. This could include allowing the local licensee to get the benefit of bulk purchasing discounts on marketing materials, to offering prizes to fly successful sales staff to the head office. Patience and persistence in building up the brand in critical. A striking example of the difference between what might appear to someone sitting in the UK and what might appear to someone sitting in China is the story of Stockport County football (soccer) club which has just as much as brand resilience as Manchester United but then Stockport County club does not figure in any serious football rankings. This was because of the energetic efforts of the Commercial Manager of Stockport County, who regularly visited China, made sure that Stockport County was known in many different places, organized events and flew the team out for exhibition matches. As a result, the amount of goodwill attaching to the Stockport County brand in China was remarkable – even after the team’s fortunes in the UK had plummeted! At one point, one third of the club’s revenues came from China !

DIVERSE LICENSEE GENRES
Assuming that the licensee in emerging markets will have the same attitude to the license relationship, as licensees in mature markets is overrated. In many emerging markets, e.g. Africa, Russia, the brand owner must educate local licensees about what is involved in operating and managing a successful license, not just simply negotiating a deal, sitting back and waiting for the royalties. In Asian markets, the licensee will often take the view that if the license relationship has an initial term of 3-5 years it is likely (for whatever reason) not to be renewed. Thus they will be pushing for the best returns as they can, as quickly as possible, before the license is taken away from them. This, ironically, is at odds with the emphasis, much spoken of in Asia, about “developing a long-term relationship” with business partners. It perhaps suggests a certain cynicism towards Western licensors. Thus decisions which may not be in the long-term interests of the brand may be taken just to make a short-term profit. Licensors should invest much effort in selecting and educating licensees for the long term, who understand the overall strategy for the development of the brand. Naturally the licensor’s actions should support their long term assurances.

HASTY ALLIANCES 
Assuming one can quickly find the right partner and tie up a successful deal gets in the way eventually. It is very unwise to fly into a country to sit down for a few pre-arranged meetings, expect to tie up a successful and long-lasting deal with a licensee, and fly out a few days later. That is simply not how business works in many emerging markets. The importance of doing whatever it takes to check the track record, background and bona fides of licensees cannot be over-emphasized. It is prudent to invest time and find the right partner or agent. than close a deal with any partner. Plan for multiple visits.

EXIT STRATEGIES
Contrary to the above if a deal has to be done quickly, one must at least make sure that in the license agreement there is an ability on the part of the licensor (and this need not necessarily be reciprocally granted to the licensee) to terminate the license arrangement quickly, easily and cleanly if things are not working out. We know of situations of a license agreement entered into for a key territory for 10 years which was only terminable on breach of contract or insolvency. In a later acquisition of the licensor’s business, the purchaser could walk away from the deal when it discovers the license, not being prepared to buy the business with a commitment to that territory for 10 years and which could only be exited on breach. On the other hand, of course, one needs to give the licensee a reasonable “run in” period in order to establish the business and the profile of the brand and to generate revenue. Three years would usually be a minimum.
IP PROTECTION
Don’t worry too much about protecting your IP – it can be fixed later if need be. Wrong..wrong..wrong ! Especially in markets which are highly liable to infringement and piracy, if anything can be protected, it should be abinitio… not later. What may be considered “adequate” protection in Western markets from a trade mark perspective may well not be enough in emerging markets. The obvious example is the local language variations of the brand, including in local script if applicable. In several Asian markets, a brand will be known by a local  name, whether ones chooses it or not. It is always wise to control this. A similar problem arises if one allows the local distributor or licensee to register the local version of their name. When the parties fall out there is nearly always a fight over ownership.

In addition, all logos should be separately registered (this is not a situation where you should cut costs by registering the word and logo together) and different variations of the name (e.g. MARY QUANT and QUANT MARY.) In addition, domain names should be covered to a reasonable degree, and other types of intellectual property, such as design registrations, should be protected where possible. The more official certificated registrations that are on files, the stronger is the position will be when problems (as they very likely will) arise.

REGISTERING LICENSES
As a sequel to the above there are still some countries where recording a trade mark license agreement perse with the respective government authorities is important. These include China, Malaysia, Singapore and Thailand. This will secure the rights of the actual trade mark owner in terms of “use” of the trade mark, countering any vulnerability to cancellation for non-use, and will enable the trade mark owner to take direct enforcement action. In addition, it can be very important to ensure that royalties can be remitted from the country to the brand owner. In many countries an abbreviated or pro forma version of the license, which does not give away the sensitive commercial terms, is sufficient for registration purposes. Naturally, this kind of registration must be kept up to date when the licensee changes or other significant alterations take place.

SUPPLY CHAIN AUDITS
Failure to carry out checks on the supply chain can be disastrous for the brand owner. There are examples where there has been a good “master” licensee who has done everything required of it under a license agreement in the emerging country, but was given a free rein to appoint sub-contractors (and sub-sub-contractors). The result was that the product manufacture was poorly policed so that overproduction and counterfeits flooding the market. The answer is to exercise a great deal of vigilance over who is to be allowed to carry out parts of the distribution or manufacturing under sub-contract and in default refuse to allow this unless the ultimate brand owner has vetted such sub-contractors. Another aspect of this issue is what might be termed “brand hygiene”. Brands, have struggled ever to recover their public image and credibility after it was discovered that products at the end of their supply chain being made for them in “sweat shop” factories involving child labor. The complexity of the problem gets further accentuated by the fact that once these factories are shut down, the wave of local complaints of it destroying a key part of the local economy have to be combated.

ROYALTY AUDITS
It is extraordinary how many licensors, whether in emerging or any other markets, seem to have a fear and reluctance of enforcing the commonly-included rights of audit under license agreements. The most usual excuse given for this is that “this might be seen as an aggressive move by the licensor”. However, in experience, over 95% of these exercises reveal underpayments of some kind. Very often underpayment of royalties is not done deliberately or maliciously but simply through incompetence or an over-narrow conservative interpretation of what is covered under the license terms, especially as new product ranges come on stream. To overcome the issue of alleged “licensee hostility”, the best approach is to automatically audit all licensees on a rotation basis, say once every two or three years, so that licensees do not feel that they are being “singled out”. Having a pre-revenue audit can be helpful in checking/helping the licensee understand what is required and checking that the appropriate accounting processes are in place.

PIRACY ACTIONS
Some brand owners, comfortable in their home markets, ignore the problems of counterfeit goods in distant emerging markets. Levi’s Jeans is an example in Asia. The problem is that, unless you “stop the rot” early, it will grow and grow.Then the counterfeits not only will flood the emerging markets, but they will begin to start damaging sales in your “home” market. Inclusive provisions for dealing with the problem of counterfeiting in your brand management budget, followed by swift and aggressive action is necessary. This is far easier to do than it was 10 or 15 years ago. Today, there are well organized firms with extensive networks able to give early warning of problems and take swift action. In any anti-counterfeiting programme, the key thing is to make sure that the goods are destroyed (and not merely impounded, because they may well be sold out of the back door by the official authorities once the brand owner has disappeared…) and to make sure that any enforcement action is publicized loudly in the local press so that there can be no question that the counterfeiters know that you are a brand owner who will stand up for your rights. Often in that situation the counterfeiters will shift their attentions to your competitor, who does not take action to enforce its rights, seeing it as a “softer” target.
These are just some of the alerts in the process of licensing brands in emerging markets. It sure requires consideration of multiple issues: legal, cultural and commercial and it is always advisable to seek expert local advice if need be.
About the Author:
Dave Sharat has spent many years in licensing with companies like Disney, 4 kids entertainment and Animation International managing businesses laser focused on markets in Asia including India.

Need a meeting space at BLE? LIMA members book now!

LIMA is once again offering meeting space at the LIMA stand during show hours at Brand Licensing Europe. Due to high demand, each LIMA member company may make no more than two half-hour bookings per day. Reservations are accepted on a first-come, first-served basis. Space permitting, walk-up reservations can be made onsite.

GUIDELINES

The following procedures apply to LIMA member reservations:

  • The LIMA Member who reserved the table MUST be present at the scheduled time – you cannot reserve a table for a client unless you are in attendance at the meeting.
  • Reservations are accepted on a first-come, first-served basis.
  • Time limit at the tables is 30 minutes and will be regulated by a LIMA staff member. Please adhere to this time limit so as many members have access to the meeting space as possible.
  • We ask that you cooperate courteously with LIMA staff members and temps when they inform you that your time is up.
  • There will be a 5 minute grace period for all reservations, after which the time slot will be forfeited and re-assigned to another member requiring space on a walk-in/as needed basis.
  • Walk-up reservations will be accepted for LIMA Members during BLE, subject to space availability. Meetings may be booked on the hour and half hour only.

MEETING TIMES

  • Tuesday, October 10 – 9:30AM – 4:30PM (show closes 5:00PM)
  • Wednesday, October 11 – 9:00AM – 4:30PM (show closes 5:00PM)
  • Thursday, October 12 – 9:30AM – 3:30PM (show closes 4:00PM)

REQUEST A RESERVATION

To request a reservation, please email LIMA UK’s Ryan Beaird at rbeaird@licensing.org with the following information:
– name, company and mobile number
– date/time needed
– person/company meeting with

How Chhota Bheem a homegrown kids’ entertainment brand has trounced every other Indian and global contender

Samir Jain - Green Gold

Samir Jain – COO & Executive Director, Green Gold Animation Pvt. Ltd. speaks about Chhota Bheem’s journey and the future plans to the India Licensing Post’s editorial team.

1. From its inception in 2008: Chhota Bheem emerged as the biggest hit outgunning all the international brands and launching in gamut of categories. What is the current state of play? How many categories are you currently active in?

– Chhota Bheem was the first homegrown Indian character and hence Green Gold had the first mover advantage. On the back of this success, other international brands started focusing more on the Indian market and we have enjoyed good competition since. We have stayed ahead of all of them. Having said that, India is a huge market and there is a room for all.

Currently we are doing well in the categories of Apparel, Toys, Food & Beverages, Back to School supplies, Books, Stationery and Home Furnishing.

2. Tell us about the origins of Green Gold and Chhota Bheem?Chota Bheem on knees

– Green Gold Animation is the brainchild of Rajiv Chilaka. It’s his dream, vision and creation.  Back in 2001 when we ventured into animation; it was really a challenging task. With dedication, hard work and lots of patience Green Gold Animation was born.

Chhota Bheem is inspired from Bheema from the Mahabharata. The idea was to create a fictional kid character called Chhota Bheem, who has the similar strength and personality of Bheema but based in a different era, as a commoner. The initial days of creation, fine tuning the concepts, characters, story lines etc. were exciting and challenging. The uphill task was to convince the broadcasters to break into the original content platform since the channels felt safe in running foreign content dubbed in local languages.

3. How has the journey in India been thus far?

– In 2001 when we planned to venture into animation in India, it sounded very alien a concept. Today, animation is a promising industry and has geared up to offer a lot more than just entertainment in India. The past few years have seen animation grow and emerge as a serious player. The industry requires not only good talent and creativity, but also cutting edge technology so as to offer the best stories and presentations. Few years’ back Indian Animation Studios were seen as outsourcing hubs for foreign clients. However, with time the situation has changed with more original content and IPs being created locally and successfully. Chhota Bheem is a classic example of one such success story.

4. What are the new initiatives from a content point of view?

– Chhota Bheem has completed Nine seasons on air. We have three spin-offs from the show, Mighty Raju, Arjun the Prince of Bali and Super Bheem which are all on TV. Green Gold has also released four theatrical movies till date.

Green Gold has predominantly been working in 2D animation, but in the last two years lot of 3D animation work is also happening. Super Bheem is a 3D animation show. The next theatrical Chhota Bheem movie would also be a 3D animated movie.

5. Chhota Bheem is often cited as one of the key success stories of brand licensing in India. What are some of the things you did right and also any mistakes made that you would like to share for the benefit of the licensing community?

– With the success of Chhota Bheem on television, our first plan was to make a foray into merchandising with comics, DVDs, T-shirts and a few stationary items.  The sales shot up and the demand touched the skies! This was the time when we started evolving options for brand licensing. We started with Notty, a drink for children and then followed a range of licensing deals cutting across categories.  Having said this, we must admit that all licensing deals have not struck gold. This is why I believe that licensing is a long term plan which involves a lot of contemplation, planning and marketing. It was important that brand Chhota Bheem should be in sync with the categories and seamlessly work with the ethos of the show.

6. How important has TV been to the success of Chhota Bheem?

– Television has been the biggest generator of viewership for Chhota Bheem.  The wide reach and coverage of TV has helped Chhota Bheem penetrate cities, towns and villages in India.

7. What made you want to retain the Intellectual property IP of Chhota Bheem when the norm is to cash out while doing a broadcast deal?

– When we launched Chhota Bheem in 2008, we never thought that it would become such a huge and successful IP. Hence our role as creator and producer of the show increased substantially.  So it became important for us to keep the IP with ourselves and work on the right mix of stories, animation, licensing, merchandising, retailing, events etc. to ensure that we control all aspects of brand Chhota Bheem.

8. You’ve added a few more characters to the portfolio since Chhota Bheem. Tell us a little more and the thought process behind each of them?

– While Chhota Bheem continued to flourish as a successful brand, it was also important for us as an animation studio to work and create new ideas, stories and characters. Mighty Raju, Super Bheem, Krishna The Great, Arjun the Prince of Bali, Luv Kushh, Chhor Police are some of the successful works from our factory. Being an animation studio with an excellent creative force helped us to create new toon heroes like Mighty Raju and Super Bheem.

While Mighty Raju represents today’s kid who is smart and gadget savvy, Super Bheem dabbles in the fantasy world with the stories of a young boy with super powers, a dragon as his friend and the universe as his playground.

Both have been generating a lot of fan following, have been climbing the ladder of success and have been generating buzz in the licensing world. It will be interesting to see them chalk out their success path in licensing.

9. Future plans for Chhota Bheem and Green Gold?

– As a company, it’s been our endeavor to keep working and looking for new opportunities.  Our primary focus will be on content- creating new animation shows and help expand the animation industry. We recently launched a new studio in Mumbai to cater to the talent and work on exciting projects. Second, is to help and develop the licensing of our brands, make it strong and robust at the same time to work collectively with all the licensors to make the industry powerful and strengthen its dynamics. We are also looking at releasing more feature films; enter new markets through our content across the globe; create exciting products and merchandise; plan more exciting events and activations and ensure that the fun and excitement behind all these efforts keeps growing.

10. How is your retail outlets faring and what’s the roll out plan?

– Green Gold Stores are growing at a steady rate. We are looking at newer strategies for the retail outlets.

11. Any last words on the success formula for Chhota Bheem?

– The success of Chhota Bheem rests on the team with their unrelenting spirit in making Chhota Bheem what it is today. Their never say no attitude, hard work and perseverance has helped us scale the charts. We also thank Turner Broadcasting  for believing in us and supporting us when we needed it most.