Thursday, June 17, 2010

Why Ford loves the ‘licensing‘ game in India

Ford Motor Company is one name that counts amongst the top believers in the power of brand licensing. Mark Bentley on the how, why and what of Ford’s licensing program

Licensing has played an important role in Ford Motor Company’s marketing mix for nearly 20 years now. Established in 1991, the Ford Global Brand Licensing program has grown from two dozen companies to over 350 licensees worldwide in 2009. Annual retail sales of Ford licensed products were recently projected at over $1.5 billion. Our key partners include Mattel, Fisher-Price, Aramis, Electronic Arts, Microsoft, Sony and Franklin Mint. The “3 Ps” form the foundation stone of Ford’s licensing program. In order of importance, the team focuses on the following basic rules: 1) Protect the brand; 2) Promote the brand; and 3) Produce revenues.

It is no small task to protect an iconic, 106-year-old company’s trademarks. Ford and its agency partner, The Beanstalk Group, work hard to ensure that the company’s intellectual assets are being used properly. Key trademarks such as the Ford Blue Oval, Ford Mustang, Model-T, Ford Thunderbird, Ford Racing and “Built Ford Tough” trucks are constantly monitored in the marketplace. If necessary, Ford takes additional steps through its brand protection and legal teams to settle trademark infringement matters.

Ford leverages licensing as a platform to create additional brand exposure. Licensees indirectly promote Ford brands by creating millions of additional brand impressions and consumer touch points. For example, over 150 licensed toy and videogame companies annually produce Ford products allowing consumers of all ages to experience the brand in ways that reach far beyond traditional advertising.

Consumers also indirectly advertise corporate trademarks by wearing Ford brands on their apparel. Ultimately, positive brand exposure may lead to the purchase of actual Ford cars and trucks.

Finally, licensing unlocks brand equity by allowing the company to receive a steady stream of royalty revenue. Ford creates brand value and consumer goodwill by annually spending billions in marketing and advertising. Inspirational designs and high quality products also contribute greatly to the company’s success. The licensing team is responsible for leveraging these marketing and design efforts by extending the brand into many categories including die-cast vehicles, videogames, apparel, technical publications, gifts and vehicle accessories.

Ford Global Brand Licensing plans to replicate its licensing successes far beyond its core North American market. In 2009, foundations were laid in India, China and Latin America. Although licensing is still in its infancy in many emerging markets, Ford is poised to capitalise on future global growth in the sector.

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Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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