Retail licensing strategies for a new reality

From the decline of shopping malls to the meteoric rise of ecommerce and experiential retail, the retail landscape is undergoing a seismic shift that fundamentally reshapes how licensed products reach consumers. Understanding these changes is crucial for adapting your retail licensing strategy to the new retail reality.

The mall exodus

The foundation of licensed product distribution has been shaken. Traditional retail anchor tenants are reimagining their footprints, requiring you to rethink physical retail and explore new ways to engage consumers in evolving spaces.

With the decline in large malls, there’s a growing trend towards localized retail experiences. This presents opportunities to partner licensing programs with local retailers, creating unique products that cater to specific demographics.

As a licensee, you'll likely shift to targeting the retailers’ customers instead of your own. Now, you must consider “how” and “where” your customers will buy beyond just product design.

Digital shift

Digital transformation has impacted how consumers discover and purchase licensed products. This demands rethinking licensing strategies, from digital merchandising to packaging and inventory visibility.

Success requires optimizing digital storefronts, mobile experiences and social media. AI analytics can bridge digital and physical retail, creating a seamless omnichannel journey.

Younger buyers still prefer in-person purchases, while older buyers increasingly favor ecommerce, which is the opposite of entertainment spending trends. If you’re a licensor or licensee, this paradox means you must closely watch evolving buying patterns to deliver the most desirable branded products.

Rise of experiential retail

The physical retail landscape is evolving, offering exciting opportunities for limited-time exclusivity and immersive brand experiences. Today’s consumers seek authentic connections through memorable experiences aligned with their values.

Interactive events, brand-sponsored activities and local influencer collaborations can provide valuable engagement and consumer insights.

Selective stocking

Private labels now account for 20% of shelf space, as retailers strip space from national brands to promote their private-label brands. This increased competition for shelf space requires data-driven insights to optimize product mix and develop compelling reasons for retailers to stock your licensed products, such as tying them to marketing campaigns or seasonal promotions.

Integration imperative

In today’s omnichannel era, the integration imperative extends beyond physical and digital spaces to include customer engagement strategies. 

Real-time inventory visibility solutions enable seamless collaboration between licensors, licensees and retailers, allowing quick adjustments based on sales trends and consumer demand.

Data foundation

Solid data on sales, inventory, consumer insights and market trends can drive unprecedented growth in licensed retail. Understanding your unique challenges enables data-driven solutions to optimize operations and foster stronger partnerships.

Robust data analytics can uncover actionable insights for product development and marketing strategies, identifying market gaps, emerging trends, and the success of licensing initiatives.
Fostering a data-sharing culture among stakeholders enables collaborative decisions based on a shared understanding of market dynamics, leading to innovative growth and greater profitability.

3 core benefits of data-driven solutions in your value chain

1. Predictive analytics for product performance
   
   Leveraging predictive analytics and machine learning helps your teams accurately forecast seasonal demand, identify emerging market opportunities and make data-backed decisions to maximize revenue and minimize risk.
   
   As a licensor, analyzing historical sales data and social media sentiment enables you to proactively adjust production plans to meet fluctuating consumer preferences, avoiding costly overstock situations. Consider integrating AI to enhance your predictive capabilities, giving you an edge over competitors.
   
   
2. Real-time performance monitoring
   
   Implementing real-time sales tracking, inventory management and financial analytics delivers the insights needed to make agile, informed decisions.
   
   As a licensee, you can minimize stockouts and optimize cash flow by monitoring sell-through rates and automatically triggering reorders. As a retailer, you can refine your product mix based on granular performance data, improving profitability per square foot.
   
   

3. Consumer insights for personalized experiences
   
   Consumer data helps you understand purchase behavior, brand affinity and evolving preferences, which allows you to develop hyper-personalized products and experiences.
   
   Analyzing basket composition and price sensitivity can inform product development, while tracking social media engagement and reviews can guide targeted marketing campaigns that resonate with the modern consumer. You must be agile and respond swiftly to insights to remain relevant in an ever-evolving marketplace.

Future-proof your licensing

The rules of retail licensing have been rewritten. Refine your strategies and leverage data-driven insights to navigate the new retail reality, future-proof your business, deliver exceptional value and achieve long-term success.