Art Licensing is an exciting area in the licensing market and can possibly supplement and artist's income and increase exposure. Licensing is defined as leasing the right to use a legally protected name, graphic, painting, logo, saying or likeness in conjunction with a product, promotion, or services. It is usually accomplished by a formal agreement between the owner or agent of the mark (the Licensor) and the prospective Licensee who is either a manufacturer, supplier of services, reproduction source, or an agent on behalf of them.
Licensing is an industry that now produces over $15 million worth of retail sales every hour, 12 hours a day 365 days a year. Little more than a decade ago, the licensing industry generated $4.9 billion worth of goods and services at retail. In 1982, the figure grew to $13.6 billion. This volume doubled only two years later to $26.7 billion and again by 1985, almost doubled to $50 billion! The 2003 LIMA Licensing Industry Survey estimates retain sales of licensed merchandise to be a $110 billion (based on royalty revenues of $5.831 billion) for North America alone. It is difficult to find another industry generating this rate of growth and sustaining it year after year.
When people think of licensing, usually sports or entertainment licensing is the first thing that comes to mind, but there is far more to the licensing business than that. Licensing is no longer simply the domain of a few specialized people. Nowadays all major companies and the media consider licensing a significant marking tool. One could even say that it has become one of the most powerful contemporary forms of marketing and brand extension and that it is being used in ever increasingly sophisticated ways. Before clarifying what the business of licensing is all about, there is a clear need for some primary information. Therefore some definitions and basic terms will be given and explained.
Licensing is the process of leasing a legally protected (that is, trademarked or copyrighted) entity known as property which could be a name, likeness, logo, graphic, painting, saying, signature, character or a combination of several of these elements, in conjunction with a product or a product line. Artists often license their work for greeting cards, posters, book covers, internet graphics, clothing, or fabrics, and of course limited editions of the original work of art.