One of the best ways to learn about trends is to connect with trendwatching.com and their latest trend briefing 12 Crucial Consumer Trends for 2012.  It’s an eye-opener.  Just reading down the list I can already imagine many new ways that art will express these trends for consumers and show up on products.

Here are a couple of excerpts from the report, in which I see a direct relationship to art licensing:

“…brands that behave more humanly, including exposing their flaws, will be awesome” and

“…younger consumers in almost every market will embrace brands that push the boundaries. Expect frank, risqué or non-corporate products, services and campaigns from emerging markets to be on the rise.”

One of the challenges of being ahead-of-the-curve and on-trend is the process of interpreting the trends themselves and seeing how they relate to consumers and then translating that into art for licensing.  Again, I will refer to the experts at trendwatching.com who understand this problem and have come up with 15 Trend Tips which are all about moving beyond looking at trends to actually interacting with them.  I recommend reading this section, even more than the trends themselves, so you can learn how to translate, discern, engage, experience, show, express and apply trends in your everyday life and in your art licensing business!  Make it your 2012 must read, and sign-up to receive their free trend briefings.

When it comes to growing your business in 2012, think about ‘expanding with focus.’  This might mean expanding the number of collections you create, or the number of prospective licensees you contact or the types of themes you cover with your art and designs for licensing.  But whatever it is you choose to expand, make sure that the expansion will impact your business positively.

If you haven’t already taken pen to paper, or keys to screen doc, then think about sitting down and writing out what exactly you’d like to grow and what you believe would increase your bottom line the most—or achieve your primary goals the most—whatever they may be.  Keep in mind that what you want to grow in your business may not be what will achieve your primary goals (or vice versa).

Gather up any notes you took about your business or goals in the last year, or even the last 3 years. Find any resemblance of a marketing plan or projections, if you’ve done them. Then clear off a desk and find quiet time to answer these questions:

1)      What were your accomplishments in 2011? Which one makes you feel most satisfied and fulfilled?

2)      What was your plan for 2011? What parts of it got implemented and which parks got overlooked?

3)      What customer in 2011 contributed the most to your gross profit and which contributed most to your net profit?

4)      What unexpected activities affected your business in a positive way and negative way?

5)      What associates (business partners, friends, colleagues, free lancers) influenced your success the most in 2011?

6)      What activities or people drained your time or energy without producing the results you desired?

7)      What time did you spend on business functions (the daily, weekly and monthly tasks of administrations, bookkeeping, research, managing employees or freelancers, marketing, social networking, PR, etc.,) and how much was spent on sales and creating new art, designs or collections?

8)      What was your bottom line in 2011, compared to 2010 and your plan for 2011?

Now with this under our belt, it’s time to create a simple 2012 Business Plan.  Start by reviewing your answers to the questions above—very carefully.

1)      What from 2011 do you want to keep, eliminate, or change based on your year-end results?

2)      What trends do you expect for 2012 that will affect your business negatively and positively?

3)      What do you most want to accomplish in 2012 (increase income, more retail exposure, broader brand awareness, etc.)?

4)      Who are your competitors and what can you do, and are you willing to do, to distinguish yourself from them?

5)      How do you want to expand in 2012 (sales, profits, employees, art, target audiences)?

The answers to these questions can be turned into a simple plan of action.  If it’s over 3 pages long, it’s just too much.  So narrow your focus, or wording and keep it simple. And probably more important than anything is being clear in your heart as to what’s at stake or risk if you achieve or don’t achieve your goals in 2012.  Knowing this should then help you find the support you need, within yourself, and with friends and colleagues to actually execute the plan. No one achieves their biggest goals without the right foundation and support, so make sure you attend to those needs early on and throughout this glorious New Year! I’m psyched.

Create art you love, but make sure it meets a market need.

It’s wonderful to create whatever you want, whenever you want.  But art licensing is a commercial business that is directed toward fulfilling consumer needs.

If you can create art that you love, while seeing where it fits in the marketplace—then your art will be more appealing to manufacturers. Art that meets a need in the marketplace and solves a manufacturer’s challenge will get licensed. It’s going to generate more excitement and more sales, as well as provide you with greater revenue potential in the art licensing business.

Stretch your creativity and see where it takes you. But to be as successful in art licensing try to find balance between creating art you that you love and art that meets a need in the marketplace.

–Thanks for joining me on this journey through the 20 Rules of Art Licensing…see you in the New Year! J’net

Learn to read and understand contracts.

Let me start by asking you, “Do you know what a deal looks like?” This is an important first step in entering and being successful in the licensing business. You need to be prepared to discuss and negotiate opportunities, which include flat fee offers, work-for-hire contracts, and royalty-based licensing agreements. And you need to understand both the contractual obligations, as well as the financial risks and potential rewards of the actual deal.

Manufacturers often hope to pay you a flat fee for your art.  In fact, there are many manufacturers who only pay a flat fee. There are also manufacturers willing to pay royalties, so that you can share in the profits of your joint venture. And, contrary to what you might think, any type of contract can request to own your art outright. So be wary. Learn to read and understand your contracts, even when using an agent.

If you are an artist who has done business on a flat fee basis before, I challenge you to tell them you are now moving on to a royalty-based model. If the manufacturer isn’t willing to move to a royalty basis, then you must negotiate a higher flat fee or be committed to moving on. No one is going to transition you out of the flat fee, or work-for-hire business models, except yourself.

With manufacturers who only work on a flat-fee basis, you need to evaluate whether the deal is right for you. Gather information from the manufacturer and compute the potential revenue for the product(s) with your art. There are actually flat fee deals that bring in more revenue than a royalty-based licensing deal would have generated; it just depends on the royalty percentage rate and volume of sales.  Then there are times the offer is so low it’s a joke, and you’re probably better off working with somebody else. You need to learn how to evaluate offers and decide on an individual basis whether a deal works for you.

If you want to work on a royalty basis and get licensing revenue, then you need to go to manufacturers who do licensing deals with artists. Since you cannot expect to change a manufacturer’s business model, it is best to look for manufacturers who are already working with artists on a royalty basis.

In this industry, licensing revenue and income are closely held secrets because most companies are privately held and this financial information is not publicly disclosed. I know artists who make in the tens of thousands of dollars, and in the hundreds of thousands of dollars each year from art licensing revenue. And there certainly are the icons of the industry that make millions. You can bet they know how to read and understand contracts.