A licence to make money

I read a fantastic piece by Peter Stiff in the Times this week (link would be here but you’d only have to pay – that’s another blog post for another day). In it, he told how food giants are “licensing out their best-loved names for use on other types of products (in the hope that) they will rejuvenate sales of the original items, boost the value of the original brand and open new avenues of revenue growth through licensing fees and royalties.” A fascinating concept and one I think we should really keep our eyes on – Unilever have even hired a dedicated licensing manager to identify such opportunities.

Although it’s been happening for a lot longer than most people would imagine (think McDonalds McFlurrys with Cadbury’s Creme Egg or Nestle Smarties), examples such as HP Guinness Sauce (as featured on Talking Retail) and Robinsons sweets (in the Grocer) have been making a lot of noise in the retail press recently. Only this week, I read about launching Budweiser Steak Sauce in the Grocer. In particular Marmite has been a forerunner in this initiative, licensing its iconic brand for anything from plates and teapots to crisps and cashew nuts. I’ve been assured the lipgloss was an April Fool though!

I think it’s a fantastic idea, providing of course any new products live up to the ethos, quality and values of the original brand, and as brand managers see the pound signs light up, it makes you wonder what next? Spaghetti Hula Hoops? Yorkshire Coffee?