Picking up again on the topic of Licensed Products: we’ve established that the best licensees in terms of revenue maximization are those with the strongest distribution and specialising in one or two categories. Depending on the territory in question this generally means that you’re going to need quite a few licensees to both cover all the key categories and maximize distribution and sales.
Hi kids – back again with next instalment of Licensing 101
In this section I am going to address Licensed Products – how that section of an agreement is negotiated and reflected in a contract, and some pointers on how best to approach.
Of course, the licensed product lies at the heart of any licensing agreement and is the reason for the two parties to come together. The licensee produces and/or distributes products in a certain territory and wants to use IP owned by the licensor to encourage sales.
So, having sorted your trademark investments & strategy, and made your peace with the imperfections/distortions of the market in which you’re trying to work, the final piece is to come up with your anti-piracy strategy itself.
So, as an example of the unfortunate reverse corollary, take Singapore. Singapore has very strong IPR (Intellectual Property Rights) protection, and police and customs agencies work in close concert and pro-actively to go after any counterfeit product coming into the market. They fully honor Madrid protocols and will actively seek out IP owners to determine if suspect product is legit or not. Any costs to the licensor to defend its IP is minimal. Also, as a consequence, relatively speaking there is very little counterfeit product in Singapore.
Remembering my note that I am not a lawyer and this blog should in no way substitute for any readers taking their own legal advice on matters related to I.P., for starters, there is something called the Madrid System or “Madrid Convention” (http://www.wipo.int/madrid/en/ ) to which most countries are signatories which states that if you hold the trademark in one market , subject to any pre-existing conflict, you have a basis to press your claim to it in all markets.
Welcome back – in the earlier sections on counterfeit, I spoke about the ‘piracy paradox’ and the reasons a licensor needs to combat piracy and the best way to do it, which is to offer a licensed alternative and collaborate closely with your key retailers to ensure they are fully aware of the official licensees.
Carrying on – now, the most likely time when you might have somewhat ‘legit’ companies producing counterfeit products using your IP is when there is consumer demand and the Licensor has not provided a legal/official alternative licensee in the market to supply that demand.
In the first section I highlighted the paradox of piracy. Beyond that, however, and notwithstanding that the overall problem is being alleviated rather than getting worse (at least in Asia, for reasons mentioned in the last post), piracy is a problem for us in the licensing business for many reasons.
Hi all and sorry for my extended absence. Has been a busy period around Pacific Licensing!
A few years back the Chief Marketing Officer of a relatively young company with a wildly popular brand made the off the cuff remark to the media that he “welcomed” piracy as a sure sign of his brand’s popularity. Of course, he got into considerable hot water with the licensing division at his firm and in many specific regards it was an ill-considered comment.