A Strategy, Not a Tactic

• Author: Michael Sanford Stone
• Profession: B.A. from Hamilton College and a J.D. from Emory University School of Law
• Pages: 75-98

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CHAPTER FOUR

A Strategy, Not a Tactic

You would be surprised to learn how many companies fail

to think strategica lly about licensing opportunities. It’s

surprising on many levels, not the least of which is that licensing

is about allowing a third par ty to use a company’s most valuable

asset—its brand. When licensing is reactive and tactica l, it’s

implemented in a vacuum—objectives haven’t been determined,

product categories haven’t been vetted, and management is not in

place to oversee the process, among other shortcomings.

Would an iconic brand launch a new product without well-

thought-out goals and a strategy to achieve them? Probably not.

Organizations will fail to take advantage of licensing’s marketing

power if they treat it as a tactic, as an opportunit y to which they

can react. Being proactive, str ategic, creative, and managerial (i.e.,

operationally ready) are re quirements for a ny licensi ng program.

To meet these requirements, best practices and processes must be

use d to de velop an ex ecuta ble st rate gy. o se as well a s il lust rati ve

examples will be d iscussed next.

Every company has its variables that need to be addressed in a

licensing plan, but certain elements are crit ical to establishing and

then executing any plan, including:

The Power of Licensing

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• Licensing Goals and Objectives

• Description of Brand Equities

• Licensing Positioning Statement

• Target Consumers

• Distribution Channel Strategy

• Market Dynam ics and Trends

• Product Categories and Competitive Landscape

• Design Guideli nes

• Financial Forecasti ng

• Program Mana gement and Support (addressed in the next

chapter)

e majority of these elements involve a comprehensive eval-

uation of the brand—the identication of the brand’s equities

and the brand’s marketing and licensing goals. Without a clear

understanding of the brand’s equities and what the brand wants to

accomplish through licensing, a company is essentially licensing

in the dark. Following a comprehensive analysis of equities, goals,

and objectives with which licensing must be aligned, the brand

needs to evaluate appropriate product categories through a variety

of lters—for example, distribution channel strategy and market

dynamics—before nalizing the plan and moving forward. And

to ensure that licensed products meet the quality expectations of

the brand, the company must be operationally ready to handle

oversight of product design, development, and production.

Several brands will be used as examples in this chapter—

mostly Cracker Barrel Old Country Store and content provider

HGTV,1 although ot her examples will be sprin kled throughout.

1. Cr acke r Ba rre l is n ot li ste d in “ Top 15 0 Glo bal Lice nso rs.” H GTV i s ra nke d #69 in “ Top

150 Globa l Licensors.” Id . HGTV HOME has won ve prestigious L IMA International

Licensing Exce llence Awards that are awarded each yea r in various categories by the

industry fol lowing voting by the membersh ip and expert judges. Two of the awards, i n

2013 and 2014, were for the Sherwi n-Williams program (pai nt), one in 2014 was for the

Bassett prog ram (furniture), and HGTV HOME won Be st Corporate Brand Progr am of

the Year in 2013 and 2015. For more on HGTV HOME in th e context of retail exclus ives,

see Chapter 7.