Licensing and Merchandising

• Licensing: is an agreement that gives a company the right to use another’s brand name, patent or intellectual property for a royalty or fee• Licensor: the company or individual

granting the license for a fee

• Licensee: the company or individual paying for the rights to use the licensor’s name or property

Licensed Products

• A company may pay a fee to use a league’s, team’s or individual’s name, image or logo on a product or on the products packaging.

• Example: NFL grants product licenses to companies that want to use the NFL logo on any products they sell

The Products

• Licensing agreements can apply to just about any product

• The licensor must be careful to select products that reflect the image its brand name has in the public eye

Merchandising Licensed Goods

• In the past most licensed merchandise could be purchased only at the event venue

• Today licensed merchandise is made available through many channels of distribution

• You can purchase licensed goods in department stores, chain stores, league sponsored retail outlets, and through the Internet

Sponsorships and Endorsements

• Two forms of licensing are sponsorships and endorsements

• Sponsorships: the promotional vehicles that financially support sports events

• All of the major sports organizations use sponsorships to help finance their operations

Importance of Sponsorships

• Sports organizations need the money generated from corporate sponsors to help pay their costs and expenses

• Players salaries, prizes, bills etc.

Types of Sponsorships

• Sponsorships can be flexible

• A company can sponsor a team for a length of time or just sponsor an event

Types of Sponsorships

• Signage: Sponsors can buy signage at a stadium

• Names may appear on scoreboard, floorboards, rafters, and electronic screens

Premium Sponsors

• Entitlements: occurs when there is one major sponsor for an event

• NASCAR signed a 10 year contract with Nextel to be its sponsor

• Facility Entitlements: where a company purchases the promotional rights to an entire stadium

• Heinz Field

Premium Sponsors

• Product Exclusivity: only one product in a product category is granted sponsorship

• Coke is official drink of Olympic Games