In the last post, I talked about the importance of having a licensing strategy before beginning to search for partners. In this post, I’ll help you appreciate just how big a role that strategy plays in your solicitation effort. Without a strategy, you will be targeting too many categories and target licensees that may not make sense for your brand. Overall, it will dilute your solicitation efforts and will take focus away from categories and potential licensees that could bring you success in a shorter period of time.
Let’s imagine that your plan without a strategy includes the identification of 20 potential product categories and 20 potential licensing partners for each of those products. The next step is to build your call list.
20 categories x 20 potential partners x 3 contacts within each company
= 1,200 initial calls / 30 calls a day = 40 days
Start smiling and dialing day in and day out for 40 days at 30 calls per day.
If you can’t make 30 calls a day, you can do the math on how long it will take to get through your call list. The reason that I included three contacts per company is that you can’t just identify one person since more than likely they might not be the correct person or you could get referred three times. Now to build that list of 1,200 contacts by researching their titles, names, phone number and email addresses. Think about it—1,200 contacts!
With your immense list staring you in the face, you pick up the phone for the first time and try to figure out what you are going to say. What is your hook? How will your brand help this company? What is your message if they don’t answer? “Hey, are you interested in licensing our wonderful brand?”
There is an art to exploring opportunities with potential licensing partners. Conducting research on a company and the individual you are targeting is imperative to the success of your initial conversation.
If you hit the jackpot by reaching the individual and they have an interest, do you know if they are the key decision maker and/or are they an influencer. An understanding of this upfront is key to assure you don’t waste your valuable resources by not having the right contact that can make or influence decisions.
As you continue with your daunting list, more than likely it will take several calls and/or emails to reach the correct person and land that first phone call. What company do you start with? How do you know it is the right company? Again, a well thought out strategy provides you the essential road map on where to start.
Fast forward, it is 40 days later and you may have received return calls that led to some conversations. What is the next step on your agenda? You need to continue cultivating the initial contacts made and determine the next steps. This coupled with keeping up with the gigantic contact list.
I am sure you will have some accountability and management will want to know status of your calls. Here is what it will sound like: “Company A: Left a message; Company B: Left a message; Company C: Left a message, etc.” Did you make an impact after 40 days? How much time and money has been spent for you to make those calls and to research the contact information? This doesn’t include where you may have dropped the ball in other areas of your job responsibilities.
Which brings up another point, you may only be able to allocate five calls a day given your other job duties. It will take you 240 days to make it through the list.
Further, you have to keep up with the list and cultivate any early interest. Even then, do you have the right company and will they be able to commercialize the product with your brand by making a quality product, landing retail placement and keep up with the demand if it is successful. Could they withstand a product recall or lawsuit if something goes wrong or will your company be left holding the bag?
When we have alignment on strategy with our clients, our goal is to have several partners lined up within the first six months. Time is valuable especially since you want your licensed product to be on shelf and meet key retail resets. At the rate you are going without the strategy approach, you might give up after the first 6 months and if you don’t, it will take years to get product on the shelf and then there is no assurance that it will be a success.
Okay, so now you are convinced that you need a strategy, what is next? Spend the time upfront to develop the road map and spend the extra money to get it right before the solicitation start gate is opened.
If you don’t have the internal licensing competency, hire a licensing expert to help guide the process and develop the road map for you. Then a strategy can be developed in a short period of time (6-8 weeks)—the idea is to finish quickly with the least amount of drain on your resources and determine if licensing is right for your company.
If licensing is right for your company, your licensing expert will develop the strategy that will provide the right ingredients for success. Your strategy will include (1) prioritized product categories that (2) validate your brand; (3) identify the potential revenue; and (4) identify key strong potential partners based on market penetration and capabilities.
More importantly, strategy is vital to gaining support internally including top management to assure that when the time comes to secure the licensing partner that it is not killed internally. Again, time and resources wasted and down the drain. Over my career, I’ve seen astounding partnerships cultivated and terms negotiated and when the time arrived for final approval, it was disapproved due to the lack of internal alignment.
I will leave you with this quote from Zig Ziglar – “Lack of direction, not lack of time, is the problem. We all have twenty-four hour days.”