Licensing

Licensing is the business of granting rights to use a form of legally protected intellectual property (e.g. a registered trademark) in association with a product, service or promotion in exchange for a defined series of payments in the form of royalties.

Licensing industry worldwide is estimated at $250 billion but in India it is still at a nascent stage. The emergence of organized retail and E-commerce has fueled the pace of growth in the recent times. Licensing of brands, designs, characters and celebrities is now becoming popular in India where these are used on various products like apparel, lifestyle accessories, electronics, toys etc. US Polo apparel (Arvind Brands), Jockey innerwear (Page Industries), Philips TVs (Videocon), Morphy Richards appliances (Bajaj), Sunkist juices (Future Group) are all examples of recent brand licensing partnerships in India.

Benefits Of Licensing For Brand Owners:

  • Allows entry into new categories and businesses
  • Provides broader retail presence
  • Inspires loyalty
  • Generates new, ongoing revenue streams at minimal incremental cost
  • Protects the trademark through registrations and actual use

Benefits Of Licensing For Brand Licensees:

  • Ease of entry into new product categories or price ranges
  • Alternative to significant investments in brand building
  • Better bargaining power with retailers
  • Build competitive advantage
  • Added value and differentiation to existing products