ArtXover is committed to providing our audience and customers with the latest knowledge and trends in Licensing. We were thrilled to have a conversation with Ms Tani Wong , Managing Director , Licensing International , Asia on how she has helped countless members license their brands and grow their business in Greater China and Southeast Asia for over 2 decades! We hope that through this interview you'll learn the basics of the Licensing industry, its market potential , key successful factors and the latest trends.
Q1. Can you share with us what is licensing ?
Licensing is the process of leasing a trademarked or copyrighted entity for use in conjunction with a product, service or promotion. The property could be a name, likeness, logo, graphic, saying, signature, character or a combination of several of these elements.
Licensing is a marketing and brand extension too! that is widely used by everyone from major corporations to the smallest of small business. Entertainment, sports and fashion are the areas of licensing that are most readily apparent to consumers, but the business reaches into the worlds of corporate brands, art, publishing, colleges and universities and non-profit groups, to name a few.
Q2. I understand that there are many different types of licensing, can you elaborate a bit more details ? Which property types get a higher market share?
Licensable properties come from a variety of sources. The definitions of various property types are not always clear and they often overlap. Based on their relative shares of the overall industry sales revenue, the key property types are Character & Entertainment, Corporate Trademark and Brand, Fashion, Sports and Publishing. Though art licensing only accounts for 1 % of worldwide total , because of its timelessness, the ability to target specific niches, year-round profit potential and moderate costs, is a vitally important segment of the worldwide licensing industry.
Q3. Why property owners and brands want to develop licensing business ?
There are many reasons for an intellectual property (IP) owner to grant a license. The most obvious one is to generate revenue from the guarantee and royalty payments. But licensing also can serve a number of other purposes. In some cases, those “other” reasons to license might actually be more important to the licensor than the sheer dollars that are earned and they include enhance brand awareness, try new categories, businesses or markets as well as protect the intellectual property.
Q4. How big is the global licensing market ？ How is Hong Kong and Mainland China doing now ?
The global sales revenue generated by licensed merchandise and services in 2019 is US$292.8 billion. US is the largest single market with US$161B. UK ranks 2nd, sales revenue is US$15.1B, and is closely followed by Japan at US$14.4B. Germany is the 4th largest country. China / Hong Kong remains at the 5th with US$10.4B.
Q5. What are the key elements to make licensing a success?
When well-executed, a strong licensing relationship brings benefits to all parties to the deal – property owners and their agents, licensees and their affiliates, retailers and, ultimately, consumers. Ownership of intellectual property and a design guide are 2 fundamental pillars. An entry strategy, understanding of local law and taxation, product road map, marketing plan, creative support and good business partners are all essential to a successful licensing program.
Q6. What are the recent trends of licensing ?
A new era of creativity where we saw innovative collaborations among brand owners. Coming out of the pandemic, health and wellness is at the core of the licensing business.
Sustainability is clearly something that is moving from something that is nice to have, to something absolutely underpinning upon anyone who is going to do business. More and more purchase intents are based on elements of sustainability and recognition that environment is an important part of how we must move forward as a world economy.
Diversity and inclusion, equally has moved from nice to have program to something that is core to the business.
Ecommerce and social commerce have become an important factor in licensor’s evaluation.
Metaverse as well as the hybrid of physical and virtual experience will take the stage.
In summary, consumer engagement is the key. Knowing where they are, what they want, how they feel …
Q7. Any advice to share with the licensing market players during the current pandemic situation?
The pandemic continues to present many challenges, we see that there has been tremendous innovation and agility that are driving the resilience we are showing as an industry. And a company’s ability to recognize the need for change and the ability and desire to be agile are really the key factors in driving them to move forward. Be creative and stay closely connected with your consumers and the ever changing market.
Q8. Can you give us a brief introduction of Licensing international organization ?
Founded in 1985, Licensing International is the only global trade association serving the $290+ billion brand licensing industry. Our mission is to foster the growth and expansion of licensing around the world, raise the level of professionalism for licensing practitioners, and create greater awareness of the benefits of licensing to the business community at large. Together with our New York headquarters, our 11 international offices serve over 1200 corporate members from 40+ countries.