What is a Licensed Brand?

What is a Licensed Brand?

Can You Leverage the Power of Great Branding for Your Own Gains?

Brand licensing is one of the best marketing tactics that a business can adopt. And what is a licensed brand, you ask?

Brand licensing is defined by the Business Dictionary as the act of leasing a brand name to another company. The leased brand is then used in a particular manner, in a defined territory, for a specified time. It is, however, one that many companies and brands are not taking advantage of.

The company that rents the brand is known as the licensee, while the one giving the brand is the licensor. So what is a licensed brand? It is that brand that has been given to the licensee by the licensor.

The licensor gets royalties while the licensee uses the name of the brand to market their product or service.

The licensee benefits by reaching a wider audience because they are able to tap into the customers of the other brand. With a licensed brand, a product or service is able to break into a new market and grow strategically.

Brand licensing also helps small brands to increase their revenue while the big brand diversifies on the revenue streams, and the licensee is able to build a strong relationship with the customers interested in their brand.

When trying to learn what a licensing brand is, a study of the following questions is helpful:

  • What Companies Use Licensing? Now that you know what a licensed brand is, it is helpful to know which companies use licensed brands. Brand licensing can be used by all types of companies, big and small, in different industries: Entertainment, consumer products, sports, and corporate entities all use licensed brands to grow their customer base and increase sales.

Some of the biggest global licensors include; Disney™ consumer products, PVH™ Corp, Mattel™, Warner Bros™, Iconix™ Brand Group, and Nickelodeon™, to mention but a few.

  • What Is A Manufacturer Brand?A manufacturer brand results from when a manufacturer markets their goods under their own name. Examples are Toyota™, Ford™, Intel™, Apple™, Sony™, Canon™, Budweiser™, Kraft™, and millions more of such brands. 

Manufacturer brands are more trusted than retailer brands because they offer great prices and quality; the manufacturers want to maintain brand loyalty, so they ensure the high quality of the items before they put their name on it. 

  • What Is A Mixed Brand?A mixed brand occurs when a product is marketed under its own name and the name of the reseller, or when a manufacturer produces two products for market segmentation. A good example is Toyota and Lexus; the Lexus brand was introduced by Toyota into the US market because in that market, the Toyota brand was viewed as a value brand. Another example is where a manufacturer will allow a store, such as Walmart or Sears, to have their name on their product.
  • What Are Licensing Fees?A licensing fee can either be money paid by an individual or business to a government agency to practice certain trades or run certain businesses, or fees paid by the licensee to the licensor of the brand to give them the rights and abilities to use their brand as agreed.

Now that you know what a licensed brand is, you can incorporate brand licensing to grow your business and expand your customer base.