Gaurav Marya has been a serial entrepreneur since his college days setting up businesses in mobile phones, restaurants, entertainment, and advisory services. Today he is hailed as the father of Indian franchising.
He runs Franchise India which has become the largest integrated franchise and retail solutions company in Asia, and possibly the world.
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ILP: Tell us about some of the key milestones you accomplished while building your empire.
GM: Today being hailed as the father of Indian franchising, my journey began since my college days when I was a serial entrepreneur setting up businesses in mobile phones, restaurants, entertainment, and advisory services.
Franchise India has grown exponentially since then. With a team of 700+ employees, 40+ offices and outreach in 300 towns and cities, the Group has touched more than five million individual entrepreneurs, impacting more than 2,50,000 businesses. Our media division organizes 300+ conferences and expositions across 100+ cities in India, and in the Middle East and Sri Lanka. We publish 4 magazines, reports and books that have both wide circulation and critical appreciation. Our franchise business website attracts 264,000+ unique hits every month.
ILP: Can you help demystify the difference between franchising and licensing for our readers? How big is the franchising business in India vs the licensing business in your opinion?
GM: Currently India is one of the fastest growing large economies of the world with amongst the youngest populations at an average age of 29 years. With growing affluence, there is tremendous demand for better products & services spread across the country which requires brands to set up stores closer to the customer. This Franchising & Licensing route gives an option of faster roll-out to the brands with a financial commitment from the partner. The brands can focus on-the-business role with marketing & product development being overseen by the brand owner. India is already the second largest franchise market in the world after the US with about 4,600 operating franchisers and 1.5 lakh franchisees. Franchise industry in India is today estimated to be at USD 47-48 billion. This is growing at 30-35 percent year-on-year and a sales turnover of the sector was recently valued at over US$7 billion. Franchising in India is getting to a point where we are witnessing a lot more maturity in the way it is shaping as compared to almost a decade ago. However, this industry has clocked the annual growth rate of 30% with a market size of USD 7.2 billion, the second fastest growing industry.
Brand licensing in India is at a very nascent stage and is set to grow manifold in the foreseeable future with rising brand consciousness among consumers and higher penetration of modern retail and e-commerce. The Indian licensing and merchandising industry is pegged at $1.2 billion and is expected to grow at a fast pace, credits to the influx of global as well as home-grown IPs. While character/entertainment genre dominates the global licensing landscape, it is fashion that rules the L&M scenario in India with a market size of $731 million. The country is growing economically and technologically at a phenomenal rate according to projections by the World Bank and IMF. Licensing can play a key part in partnering with companies and making profits in India.
ILP: Apart from Franchise India your company also organizes one of the largest licensing shows in the country – India Licensing Expo. This year will be its 3rd edition – what are your expectations?
GM: After the successful second edition of India Licensing Expo last year, we are ecstatic to inaugurate our third edition of the event. India Licensing Expo is a dedicated hub for industry business across diverse verticals like cinema, music, corporate, fashion, character, and sports licensing all under one roof. This platform will also bring together voluminous brand opportunities, elaborate knowledge forums, exclusive licensing appreciations, fun character parade and many more. In the scenario, where India is a brand-hungry market, we see a natural inclination towards licensing as an effective retail strategy. Brand licensing has been well accepted as a retail strategy in India, and through ILE 2019, we will bring the universal perception to the Indian landscape. The owners of intellectual properties (IPs) comprising the major character, entertainment, celebrity, and corporate brands are keen to enter the Indian market. Everyone wants to tap the 1.3 billion customer-base that the country has, especially when the consciousness of brands among consumers in 900+ cities are very high.
ILP: When do you think a brand is ‘license ready’?
GM: Licensing is directly proportional to ‘Popularity’ & ‘Aspiration’. For a brand to successfully surf the tide of brand licensing, it is imperative to evaluate the brand on two parameters ‘Is the brand popular enough?’ and ‘Do the target audience aspire to adorn the brand’. We often see, a brand without creating its mark on retail, embark on their licensing journey, this increases the probability of uncertainty, a brand to hit of well through brand licensing should cross the stage of infancy and move to maturity in its product cycle. Licensing a brand is a way to create business growth with relatively low investment – but if you haven’t taken the time and effort to grow a successful business and brand in the core category, it’s too risky to handover a brand to someone else to experiment with.
Also, there are other parameters to be considered while plotting brands future – for example how well protected are you legally and what’s your broader marketing strategy? Once these parameters are taken care of, that’s when the brand can be successfully extended through licensing. However, I truly believe every brand has licensing potential and one doesn’t need to throw a double six to start the game of licensing, just choose the right time to play it.
ILP: Apart from a ChuChu TV or Chota Bheem, very few Indian brands have been able to make a dent on the global stage. Given your global perspective, where have we fallen short?
GM: It’s not fair to blame consumer acceptability or similar factors, I believe the major reason is the balance between good animation quality and merchandise quality, it is of vital importance to maintain quality standards for both. This is where the global properties are moving ahead. Also, a major factor is the lack of investment from licensor’s side.
A good example would be the Yankees, Of course, retailers and manufacturers are happy paying good royalties and having NY on their products but this is possible only because of the kind of marketing spend done by the brand to promote the property. This really marks the success of a brand in the domestic market as well as globally.
ILP: Do you think the licensor-licensee relationship needs further fine tuning especially in a market like India which is rapidly evolving?
GM: I would definitely agree to this, there is a major need for fine tuning between both the parties. India being a unique market, Retail here is dynamic and evolving rapidly with the focus shifting towards organized retail, yet it holds a very small percentage currently.
Unlike in a typical market, where a licensee does not require hand-holding and is well versed with the entire operation of licensing, India is still at a nascent stage where special netting of synergies is required to successfully carry out the program. Here the role of an agent becomes more crucial, where they need to bridge the gap between Licensor & Licensee, as It is just not about milking the brand with a short-term goal in India, but patiently driving towards the goal by both brand owner as well as the Licensee.
ILP: What systemic changes are required to take the licensing business to the next level in India?
GM: Primarily, a cordial relationship between the Licensor & Licensee plays a very important role and lack of alignment often leads to frustrating losses of time and money. Good understanding of each party’s expectations ensures the program gets off on the right foot to achieve the success both that of licensor and licensee as envisioned when they partnered.
Secondly, I would like to stress upon the marketing of the brand, which is more important than it seems. In other developed markets brands are constantly investing backward to promote itself, but somehow when it comes to India, brands are a little apprehensive before investing in this market. It is so important to go full out for a brand in any given territory to make the licensing program successful. I also believe that there is a lack in the ethical practice of brand licensing in India. Of course, due to high unorganized retail, infringement is a point of concern here, but in order to mitigate this, the regulatory body should be formed with stringent rule & regulations. To ensure moral practices are being followed, a regular visit by the brand /body should be planned and right action should be taken against the party in case of infringement. Currently, due to the brand-hungry market, someone’s loss becomes others gain, which creates a grey area. If this can be judicially controlled, the licensing business can surely grow at a much faster pace.
ILP: Which is one of your favorite brands at Bradford License India and one which you would love to represent but haven’t yet had a chance to?
GM: All of our brands in the portfolio are very important and dear to us, so no favorites to call out. To answer the latter half, with the growing Fashion & lifestyle space we would really like to have more Fashion and corporate brands on board with us.
ILP: Bradford License, your brand & licensing agency represents quite a wide array of brands across categories from Character & Entertainment to Sports, Music, Celebrity & Art. Which categories are under-penetrated in the Indian market according to you?
GM: We feel music & art are definitely two genres that are under-penetrated. To add to it, we feel there is immense potential of this category in India, but because of poor handling of the entire proposition, it is unable to derive the value and novelty it deserves.
ILP: What’s your advice to young aspiring licensing professionals?
GM: Licensing is a great industry to be a part of. As I said, we are still at a nascent stage, indicating the amount of growth opportunity coming our way. Till now we may have only cracked 10% surface of the total industry potential, marking huge space left for exploration. So my advice would be to get your smart caps on and gear up for some big business.
ILP: How does Gaurav Marya keep his finger on the pulse of global franchising and licensing?
GM: Franchising & licensing offers a convenient market entry option to brands with global expansion. A brand can target a market with a sizeable opportunity through these routes even as a brand has a limited market understanding. The financial commitment is considerably reduced when foraying a market through these routes with a strong upside with master fee & royalties.
About Bradford License India Pvt. Ltd.
Bradford License India is a joint venture between Bradford Licensing LLC and Franchise India Group. This venture has marked as India’s first complete licensing solution provider, complete with Franchise India Group’s expertise of 19 years in brand development, opportunity identification, business matching and consulting in India and Bradford Licensing’s 32 years of expertise in the licensing industry. Developing and managing licensing program from over 10 years, Bradford License India currently represents 50+ global brands and enjoys a well-established network in retail. For more information call Shifa Rastogi at +91 9999697442 or email at firstname.lastname@example.org
About License India:
License India, an exclusive brand licensing media & exhibition vertical of Franchise India Group. India’s first licensing media services company formed with the objective to increase awareness and support the growth of licensing in the country. Alongside media division, License India organizes business-to-business licensing shows encapsulating conferences, workshops, expositions, and awards, under Brand Licensing India, and India Licensing Expo. License India excels in the licensing space with its strategic and knowledge-based verticals. For more information call Shifa Rastogi at +91 9999697442 or email at email@example.com