Imagine this scenario: you are sitting in a bar, look over, and see that there is a film crew recording a group of people who are casually ordering a round of drinks. What would you do? Ask for a selfie? Try and position yourself into the frame? Or maybe you would do nothing and just tell your friends about it later.
Well when one ambitious entrepreneur was presented with this same scenario in 2012, he did what any hustling entrepreneur should do: he started selling. As fate would have it, the camera crew was there for MTV's hit show "The Real World". The San Diego-based cast had stumbled into a bar on a Sunday morning and sat next to entrepreneurs Travis Lubinsky and Trevor Jones, founders of luxury watchmaker Flex Watches.
If you watch the episode, you see Travis immediately reach out to the cast and begin showing off his products. This lead to an entirely new element being introduced to the usually raucous show: charity. One of the cast members had been affected by a friend's suicide and so decided to partner with Flex Watches to make a custom line of watches with a portion of the proceeds going towards suicide prevention.
And just like that, a product licensing pro was born. After the success of that line, Travis has gone on to create product licensing deals with brands such as Last Kings, WWE, Special Olympics, Anaheim Ducks and Stand Up To Cancer. As well as dozens of high profile celebrities such as Tyga, Paris Hilton, Xzibit and Daymond John. He has become a master of product licensing and he sat down with me to share his top 8 tips for entrepreneurs looking to lock in licensing deals with big name partners.
While locking in a 6-figure deal with an A-list celebrity might sound glamorous, things are never that easy and it's best to start at the bottom and slowly climb the ladder. Lubinsky says, "Obtaining Greek and collegiate licenses has proved to be a great starting point for many entrepreneurs, including me."
Target your product.
Make sure you are hyper focused on who actually needs and will use your product. Otherwise, you are just wasting your time and money. Lubinsky says, "Your product needs to be targeted at a specific demographic that will pay top dollar to own it."
Make sure it is popular.
"It is important to ensure that the brand you are looking to reach a deal with is established, respected, and most importantly, popular. If they don't meet that criteria, there is little benefit in partnering with them."
Do your homework.
If you are trying to do a deal with an established brand name, you better come prepared and have a marketing plan that will sell the product. "Demonstrating that you have a plan can alleviate concerns that these big brands have in working with young entrepreneurs," says Lubinsky.
Make sure you have sales.
The more sales you have, the more influence you can have on the licensing negotiations. Brands like to be linked to successes; showing that you are already successful can greatly increase your chances of a successful licensing agreement. On his success, Lubinsky says, "I quickly learned the biggest factor to a successful licensing campaign was distribution and sales."
Getting your first licensing deal can be exciting but it also opens up an entire new set of operational tasks that must be done. Brands will expect to receive regular reporting as well as their royalty payments in full and on time.
Always look for new opportunities.
The entire goal of one licensing deal should be to leverage that to get another deal. Lubinsky says, "Use each license as a stepping stone to the next biggest thing." With forward momentum you can constantly get bigger licensing deals with bigger brands.
Be willing to negotiate.
Sometimes the deal you want just won't happen. Because of the complexity of licensing agreements, no two agreements are ever the same and the product, terms, and most importantly profit margins, can vary immensely.
Successful product licensing done properly can open new doors and elevate your idea to an entirely new level. While it can be challenging, complicated, and stressful, it is a skill that any determined entrepreneur can learn and master.