Brand licensing might seem like a no-brainer in the media business. However for others to want to hitch their idea to your brand, you need to have one that is recognizable for all the right reasons. You also need to make smart decisions about which licensing deals will work for you in more than just the financial sense. Forbes Media COO Mike Federle says that while he was brought into the company two and a half years ago to do the usual operational stuff expected of a COO, his “primary focus is on business development and leveraging the brand to develop new, non-advertising revenue.”
And he’s been doing just that. His latest licensing deal grants Lotaris SA the rights to the name Forbes Digital Commerce, which provides mobile payment-based services and solutions to various industry sectors. Announced at Mobile World Congress, this arrangement associates the Forbes brand with mobile payments, which is a win on all counts according to Federle. In addition to the up-front licensing payment and annual royalties based on the total revenue of Forbes Digital Commerce, he says “On the brand level, we think this is a great place to be, given that mobile is such an important business tool.”
There are three primary questions in Federle’s litmus test for analyzing potential brand-licensing deals:
1. Does it fit the brand?
2. Is this a reputable partner?
3. Can this opportunity scale?
It is essential to develop a solid criteria for maintaining hard-won brand equity. The issue of scale is also significant, “We turn down a lot of opportunities because they aren’t big enough. We are focusing on bigger plays. Mobile is a much bigger business.”
As is Real Estate, which Federle points to as another example of brand-licensing that passed his litmus test. Last year, the company worked with Century Properties group in the Philippines to build the world’s first “Forbes Media Tower.” That move heralded the “beginning of a Real Estate Play in Asia,” which associates the brand with booming markets and high-end business developments.
As Forbes magazine might council its readers, Federle says Forbes Media must “align with where the future is going.” And the future is undoubtedly mobile. “What is happening at Forbes and throughout the industry, is that our digital business has grown very large. And over the last year, we see approximately 30% of our traffic at Forbes.com coming from Mobile devices, up from about 25% the previous year. We know that in media, and business in general, there’s huge and rapid transitioning over to mobile.”
However one particularly appealing aspect of the Forbes Digital Commerce deal was its association with mobile payments. “Mobile is already big. Where the real takeoff will be is when we get rid of the friction that is in the system now, and we want to be part of a solution that helps create a seamless flow—across carriers, currencies and borders.”