CREATE YOUR MONEY MAP (Marketing Action Plan) IDENTIFY YOUR MARKETING STRATEGIES

16 01 2017

 

I’m going to keep this blog entry simple because here is where creating your MONEY MAP is different than a marketing plan.

cymm-identify-marketing-strategies

Most marketing plans include positioning, pricing, placement, people, promotion (and other P’s).  They are often long-winded explanations of what you already know, and sometimes actually ignore the well-thought-out ‘planning’ part.

Marketing plans should follow your mission statement and show how you intend to achieve your goals. They are about strategies and then the tactics which will be used.

For artists in the licensing arena, or wanting to be licensors, I recommend your marketing strategies focus on prioritizing your products and promotions.  That’s it.  I’m going to say it again: Prioritize Your Products & Promotions.  If you can execute market-ready products (art/designs/products) that meet consumer needs and promote them successfully to licensing manufacturers, you can virtually ignore your competition (who most likely won’t do this!) and meet or exceed your goals. (Keep reading…we’ll cover how to promote your art licensing collections in many of the days to come.)





Rule #20

22 12 2011

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





Rule #19

12 12 2011

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.





Rule #18

2 12 2011

Know What You Need in an Agent Before You Hire One.

 

Having an agent is wonderful and amazing.  Having an agent can be frustrating and awful.  Gee, I’ve certainly heard both comments.  You may have had or heard similar stories that straddle both sides of the spectrum.

One thing I know for sure is that there are terrific agents in the art licensing and licensing business who are honest and tirelessly hardworking.  They also have the incredible contacts you need and the know-how to get your contracts negotiated.

Let’s face it.  Agents know the ins and outs of the business and are invaluable. Some agents, but not all, will give you trend advice, art direction and branding strategies.

All this help will cost you an average of 40-50% of your royalty income.  And it’s worth every penny, if you really want and need an agent to handle the sales and marketing aspects of your business.  What I really want to emphasize is that you should understand what services you want and need, and exactly what services the agent you find (or finds you) offers.

All agents are not created equal.  I can’t say it any clearer.  Perhaps most surprising is that the services agents offer vary in so many ways. It’s best to get some comparisons, because they don’t all do the same thing for the same amount of money. For example, you get 7 services over here for 50%, but over here you get 12 services for 50%. And what are those services? Finally, you need to strongly consider the personality of the overall agency and that of the agent who will be directly responsible for your business.

To find a great agent you need to interview your prospects thoroughly. And while it may have been a challenge to get interest and an offer from a reputable agent, you still should not sign a contract with an agent until you really understand what you’re getting for your money.

Ask a lot of questions about their planning, marketing, sales and PR efforts.  Also what is their trade show attendance and whether they provide you with creative direction or production assistance. And make sure you understand what, if any, expenses you will be required to pay. There are a whole lot of things you need to think about, so interview them as if you are vetting a potential business partner—because that’s exactly what you’re doing.





Blog #17

28 11 2011

Manufacturers today want a sure thing.

As the economy has gotten tougher for manufacturers, they have gradually become more and more risk-adverse. They no longer like to produce product, shelve it in the warehouse, hold the stock, and hope it sells. That approach makes them vulnerable since product must ultimately sell to pay for the inventory created on speculation.

Rather than wait for sales from the product produced in the warehouse, manufacturers only spend money to produce product when it’s actually ordered by their retail customer.

This approach has become quite commonplace, though few people talk about it.  A manufacturer might ask, “I’d like to shop your art around. Is that okay?” Or, “Can I take this out to retailers and get some feedback?” Both of these questions mean the same thing: they want to show your art to retailers to try and get “buy-in”—a retail commitment—before they actually sign a licensing deal with you.

What I want you to know is that these scenarios do happen. Don’t be surprised.  Get some kind of agreement in place, if not a contract, at least a ‘shopping doc‘ to clarify what they can and can’t do. You just need a plan for how to deal with this situation, and a way to determine whether it is a good idea for you at the time.  The answer may vary, so be prepared for that as well.  Think about the potential outcomes if the manufacturers are successful ‘shopping’ your art, and if they aren’t.  And what are the potential risks and rewards when manufacturers show your art to retailers without your having a deal commitment.

I am sure many of you have been experiencing this in your art licensing business.  Perhaps you’d like to share your story.  This new way of doing business definitely has its benefits and negatives.








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