Grow Brand Value While Accelerating Revenue Growth Three ways to expand the licensing value of your brand.
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Brands have become an essential component in how consumers purchase, perceive and learn about products and services. This means that increasing brand licensing value is critical to any brand's successful progression. Fortunately, there are three proven ways that will set you on the path to effectively increase the licensing value of your brand.
Related: Extend Your Brand's Reach With Licensing
1. Strengthen your brand's reputation.
When consumers are delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates -- buying the brand more often and recommending it to others. This behavior serves to build the brand's reputation. In fact, consumers will often purchase a brand for the first time because of its reputation. The brand, therefore, adds value and certainty to a product made with unknown hands.
The stronger a brand's reputation, the higher the value of the brand and the greater revenue it will drive for its owner. Prospective licensees want to gain rights to brands with the strongest reputation as these are the brands consumers demand and retailers prefer most. The stronger the brand, the higher likelihood that the licensed products will sell in and sell through.
2. Increase your brand's expandability.
Brand loyalists and advocates look to their preferred brands to deliver more and better products year after year. When this occurs, the brand gains permission to expand into categories that complement its original offering. For example, the Mr. Clean brand, owned by P&G, was launched in 1963 as the first household liquid cleaner. Over time, the brand gained a strong reputation for its ability to clean effectively on a variety of surfaces.
By delighting its consumers, Mr. Clean built significant brand loyalty and allegiance. When asked, consumers told the Mr. Clean brand team that they expected the Mr. Clean brand to offer additional products that simplified and enhanced the household cleaning experience. To satisfy these consumers, Mr. Clean developed a line of branded mops, brooms and brushes. These products were met with enthusiasm and over time, consumers demanded even simpler and more effective ways to clean their homes.
Related: Is Your Brand Really Ready to Expand?
Today, the Mr. Clean brand can be found on an expansive list of products including scrubbing tub and shower pads, Magic Eraser cleaning pads, AutoDry car wash systems, multi-surface disinfecting wipes, rubber gloves and many others. In fact, many of these Mr. Clean products are officially licensed merchandise. By owning a brand that can be extended into numerous categories, companies are able to attract and retain multiple prospective licensees. Using licensing to complement internal resources actually accelerates a company's overall time to market.
3. Deliver a best-in-class licensing program.
The licensing industry exists today because brands cannot be created overnight. In fact, it takes years and millions of dollars to create brands that are trusted and valued. Companies that own these brands are naturally protective of them, and rightfully so. A brand's reputation can be easily tarnished when it fails to deliver on its brand promise. When this happens, consumer loyalty can erode quickly, resulting in lost sales. As such, many brand owners would rather choose not to enter a category through licensing than risk damaging their brand. However, successful companies know that a well-run licensing program can strengthen their brands and provide a substantial increase in profitability.
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Companies with successful licensing programs select best-in-class companies to license their brands. Consider the Walt Disney Company. They furnish their licensees with clear guidelines on how the brand's standards are to be implemented and provide a straightforward approvals process that enables the licensee to get their licensed products into the market quickly and at a fair profit. These licensees, in turn, deliver world-class innovative products that over deliver on the Disney brand promise, thereby strengthening its brands. With a well-run licensing program, not only is the brand well protected, but licensees can also quickly commercialize best-in-class branded products. This not only strengthens the brand's overall reputation, but also increases the licensing program's overall value.
By adopting these three strategic initiatives, you will increase consumers' trust in your brand, opportunity to purchase and confidence in product quality. This powerful combination will drive your company's revenue and ultimately grow your brand's value.
