Licensing Lessons

How to Create a Successful Licensed Product Line Based on a New Licensing Concept You Created and own

Here are some lessons learned from my personal experience, and a recommendation about a very focused way to move forward with a Licensing project. This could apply to a licensed property, but this discussion focuses on an idea you personally created and own which you want to license for a line of related products.

First, it is important to simplify the number of major projects you are working on. In my experience attempting more than two major undertakings causes "static" and prevents either from being successful. At the time of writing, my two major activities are spiritual talks and the Linescale business.

I think there are some lessons from the past on how to move forward successfully with a marketing concept you want to license. One of the early new successful brands I created was Cocoa and Fruity Pebbles. Pebbles has an important "success" lesson for your NLC (New Licensing Concept).

One of my early failures was Riverdale Toiletries for Kids, which was intended to be an Archie line of kid's products. During development I generically called the line "Youth HBA" while doing the product development. Riverdale/Archie/Youth HBA has a definite "failure" lesson for your NLC.

There were two points of failure with Riverdale/Archie/Youth HBA.

(1) I did not start by  developing the overall Riverdale branding concept. The marketing, packaging and advertising positioning should have come first. The positioning should have been Riverdale brand products from Mr. Lodge's company. The individual products would have been associated with one or more of the characters, such as Betty's Shampoo, etc. Veronica, Archie's aspirational girl friend, is the daughter of the richest man in town, Hiram Lodge. Mr. Lodge is the owner of Lodge Industries. The products manufactured by Lodge Industries have never been specified in the comic strip. I had the license to use the Archie characters for this line of products, and the strong support of John Goldwater, the founder of Archie Comics. We would have integrated packaging, ads, promotions, etc. with the comic book and TV show. Instead, I stupidly used a generic plug while doing the product development. That was dumb. It is a big mistake to center your product development on an under-developed marketing concept.

(2) The Riverdale/Archie/Youth HBA youth toiletries product line was too complicated. It was composed of too many different businesses at once. I naively treated the line as a single business - soap, shampoo, toothpaste, kid cosmetics, etc.. Too many products at once is a potential "failure" point for your NLC.

The Lessons: Do not complicate your product line and do not let your NLC suffer from underdeveloped marketing concept.

Cocoa Pebbles and Fruity Pebbles Cereal was different.
The key element of success for Cocoa and Fruity Pebbles was not just the obvious Flintstone license. I had been unable to get equally good Licensed cereal ideas through the company's palace guard for a number of reasons. In general, the reasons given were that new licensed character cereals were feared to be "too new" and "fads" which would burn out after a year. Flintstone's Pebbles got through the company because it was described as a "second brand", or "re-branding" of an existing moribund product. I did not call it a re-branding; I described Pebbles as a "line extension", or a new, second brand to extend the life and reach of an old brand. Who could argue with such a riskless proposition?

The Lesson: Keep it simple and familiar. Minimize the number of new elements.
Everyone in the company from Executive Management to Production was comfortable with the familiar old brand, even though the market share had shrunk and volume and share continued trending down. This old brand was called Post Sugar Rice Krinkles (you probably never heard of it.) That was one of the cereal brands I was product managing at the time. We tested new flavors, new colors, new aromas, but stayed within the existing plant manufacturing process. We downplayed the "newness" of the product. We downplayed that Cocoa and Fruity Pebbles would be the first licensed children's cereal positioned as "the cereal OF an existing, popular comic character". Success came in getting this new product through the corporate maze because The Flintstones branding was perceived as just ONE NEW ELEMENT in a business with many knowns.

UNDEROOS was a simple new idea in a large, old established business.
If you think about UNDEROOS, the Licensed children's underwear brand I sold to Fruit of the Loom (Union Underwear), that product concept was also just a couple of simple related ideas - a licensed superhero uniform, and one top and one bottom packaged together instead of three tops or three bottoms packaged together. These two simple related ideas were added to a very simple, but dull, commodity business - children's underwear.

What does that imply for your NLC as a licensed line? As your licensing consultant, I would advise you to find a manufacturer of a first flagship product or product line of similar products with production capability, functional characteristics and capacity  closely resembling the flagship first product you want to introduce. Sell your NLC idea to this company - or their corporate management -  as an added line extension, or second brand, which expands the volume and revenue of their current product. That will let you ride on their pre-existing ingredient procurement, manufacturing, packaging, legal, distribution and sales process. You will have just added one new element. Of course, it will be the element that "makes all the difference".

Whether you do this with or without a venture group's financing is not critical. That will have pluses and minuses. But, finding the candidate companies is necessary legwork you need to do - or figure out how to get done. This is very different from finding a contract packer. You will be looking for a business or product line for which your NLC will be the savior. Since, through intelligent sub-licensing to this company, you will continue to own the NLC and unfettered use of the brand, you will, following the successful and profitable marketing of this new NLC brand of X, have the necessary financial resources and leverage to repeat this process with other similar manufacturers of related products.

That will be the start of a successful licensing business.