License Agreement Marketing Definition

Posted by Robin Hensley

A license agreement is a written agreement between two parties that describes the parameters by which one party may use another party`s property. While the owner of the property in question retains ownership, the other party purchases a licence for a lump sum fee or royalty. Licensing agreements are most often used for intellectual property rights. Licensing is a multi-billion dollar global market. But a license is not a recipe for immediate success. This gives you the interest in a name that is either unique or has some consumer acceptance, but it still takes good sales and marketing to succeed. A license is essentially a tool and if used well, it is an extremely inexpensive marketing tool. In a typical license agreement, the licensor undertakes to make available to the licensee intellectual property rights such as the licensor`s technology, trademark or know-how. In exchange for the licensor`s intellectual property, the licensee generally applies to a prior royalty and/or a royalty to the licensor.

A royalty is a current royalty paid for the licensor`s right to use the intellectual property. The benefits of licensing can be viewed from two angles: licensors and licensees. Licensees expect the license to show them revenue growth. This revenue growth can take the form of growth within the existing market or the possibility of opening up a new market. To do this, licensees expect the brand that concids them to have a significant brand preference, open doors, and ultimately help them meet or exceed their business goals. The license agreement obliges the licensee to meet certain sales targets and royalties; The licensee`s objective is therefore to quickly achieve its commercial objectives and thus fulfil its contractual obligations. Royalties are the funds that the licensee pays to a licensor for the right to use the licensed property. It is calculated by multiplying the royalty by the net turnover. [4] A license agreement is a contract between two parties (licensor and licensee) in which the licensor gives the licensee the right to use the licensor`s trademark, trademark, patented technology or ability to produce and sell goods. In other words, a license agreement allows the licensee to use the licensor`s intellectual property. Licensing agreements are typically used by the licensor to commercialize their intellectual property.

Character Licensing is another major licensing segment in India. The big players in the character licensing industry in India are Disney India, Viacom 18 and Cartoon Network Enterprises. Disney India`s licensed characters include Mickey Mouse and Donald Duck. Viacom brought popular Nickelodeon characters like Dora the Explorer and SpongeBob SquarePants. Cartoon Network has a portfolio of characters like Ben 10, Powerpuff Girls, Mr. Bean, Roll #21, We Bare Bears. the acquisition of consumer awareness and commercial advantage of a well-known brand, character, logo, design, etc. The most obvious advantage for a manufacturer or service provider that licenses a trademark, character, design or other intellectual property is the marketing strength it gives to the product. It can cost hundreds of thousands or millions of dollars to rebuild a brand from the ground up, and licensing is a way for a manufacturer to use the entire brand and image that has been made before. A child in a toy store is not looking for an “action character.” He usually looks for a certain character that he likes. Before choosing between multiple cleaning devices, a buyer may be drawn to a buyer who bears the brand of a known cleaning liquid and not a more generic label..

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