Business Musings: Licensing Opportunities
I think the moment writers dream of being published, they have the same wish. They want to write the books of their heart. They want those books to reach a vast audience, and they want someone else to worry about doing all the things that turn a book from a rectangular object on a shelf into a vast global empire a la Harry Potter.
Most writers expect their agents to help with that. Some think the publishers will do it all. Even more writers believe that once they make a movie or TV deal, the magic will happen. Their heroine will become an action figure. Their hero’s face will decorate a throw rug. Even the feline sidekick will find images of herself for sale in the plush toys section of every toy store and bookstore on the planet.
Not to mention the new stuff—the apps, the games playable on every device, the YouTube channel, the Instagram feed, the Spotify playlist. The old-fashioned stuff too. Socks and t-shirts and posters. Tchotchkes that come directly from the book, like Bertie Bott’s Every Flavour Beans from Harry Potter. The first time I saw a packet of those, I laughed out loud with pleasure.
But it’s not that easy to have products made from your book. Most books don’t easily lend themselves to toy or product licensing. Most books aren’t popular enough, truth be told. And many don’t have the imagery or built-in products like Harry Potter did. (Rowling was simply showing how kids could get into a craze, so she invented a bunch of crazes, which then became actual crazes. Nifty cool, in my opinion.)
Most publishers barely have time to put out their monthly schedule of books. And most publishing houses don’t pay attention to subsidiary rights aside from translation rights and film/TV rights. Thinking about other types of marketing, licensing, and sales is simply impossible for them. They don’t have the staff, and they certainly can’t do it for each book they publish.
In fact, most publishers only respond to requests. So if some game company comes to them and asks to license the board game rights to The Handy Dandy Money-Making Novel, the publisher will figure out if they have those rights to license (chances are they do, these days) and if so, then they usually say yes, without any negotiation at all.
There is, as my poker-playing husband is wont to say, a lot of money left on the table each and every day.
I get it. I do. Because Dean and I leave a lot of money on the table as well. We don’t put the rights we own out for license, not enough anyway. Although we’re talking more and more about the best way to approach it. When we first set up WMG Publishing, I wanted a dedicated translation department, an audio department, a TV/film department (focusing on YouTube and other things), a game department…you get it. I tend to think big, as many of you know.
We started an audio department, discovered that our dedicated audio person…well, never mind…and couldn’t find someone else that we wanted. I made initial contacts with someone to handle translations (he has done so for other publishing companies in Europe), but we never had the funds to set that up.
Or rather, we don’t have the funds yet. So we license the rights.
And right now, since WMG is still growing and doing so sensibly, we have the other departments on the back burner. We will eventually handle those rights and licenses in-house, whatever that means, but we don’t do it yet.
However, we’re moving in that direction.
We plotted our first move in that direction in December as we did our 2018 planning. Then my health and the sped-up move blew everything up.
(The move, for those of you who are curious, is still going on. It takes a long time to go from 5,000 square feet in Oregon to 1600 square feet in Vegas, even though we will now sell many of our collectibles at the various stores. We also have a 900 square foot apartment in Oregon that we will use when we go back up every month, but still, quite the downsizing. Poor Dean is doing most of the work because I had to leave a very physically toxic environment [for me], although we spent all of Memorial Day weekend unloading a gigantic U-Haul here in Vegas.)
One of the things the move blew up was a trip to the New York Rights Fair in early June. Allyson Longueira, the publisher of WMG, was going to scout it out. But with all the changes—dealing with people who are not in town much and who are distracted when they are, setting up new systems, accommodating the onslaught of stuff into the office, and moving the in-person workshops to Las Vegas—made it impossible to prepare for that fair. Even though Allyson wasn’t going to participate much in the fair itself. We had planned to have her scout it out, and figure out what we needed to participate next year.
Well, one of the perks of living in Las Vegas is that everything comes here. I still haven’t checked the convention schedule for writing, writers, and the various genres I’m in. Nor have I completely scouted out trade fairs, especially the ones writers usually don’t attend.
But a friend of mine who owns a gaming company came to town last month, and we spent some time together before the start of the convention that brought him here. That convention?
The Las Vegas Licensing Expo, which bills itself as The Largest Licensing Trade Show. Everyone was there, from Disney to the BBC to the NFL to some maker of “the world’s best cheese.”
When I found out that this was what my friend was attending, I asked if he could get me in. He said it was no problem at all. So late one afternoon, we stood in line, and he got me a badge. All we did was walk the floor together, and I learned a great deal.
The world of licensing is vast. I knew that before I attended the fair. I also knew that it would take time to learn that world. No better way to do so than to jump in headfirst.
But as I walked the floor with my friend, and as he stopped to make lunch and dinner and drink appointments with colleagues and people whose work he wanted to license, I realized just how vast it all was.
You can license anything to anyone, if you know what you’re doing. And knowing what you’re doing is the key. Most book agents haven’t even been to a show like this, let alone have any idea what they’re doing when they get there.
The larger agencies, with movie and TV arms, have a licensing division, but even then, those agencies usually sell the rights for their clients to one organization—say a movie studio—and don’t worry about licensing the coffee cups on their own.
Money left on the table.
And I know why it happens. It happens for the very reason that writers want to hire someone else to handle everything for them.
Learning a new world—any new world—is a lot of work. And you need to be a bit forward to handle a licensing fair. Most writers aren’t. But that doesn’t mean they shouldn’t attend.
For one thing, the Licensing University attached to the fair is worth the time all by itself. This year’s classes covered everything from the Basics Of Licensing to Extending A Brand Into Licensed Experiences And Events to What Every Licensing Pro Should Know About Royalty Rates.
I didn’t know about the licensing university until it was too late for me to attend. (I had other things scheduled, unfortunately.) But I’ll be first in line next year. In addition to walking the floor, again, I’ll be learning this side of the business in a depth that I don’t yet have.
As you know from the branding book (Creating Your Own Author Brand) and other things I have written in this blog, this sort of thing fascinates me. And I know it makes many of you cringe in terror. I’ll learn some of it so I can write about it here.
But you’re going to need to give this part of your business some thought as well.
Most writers don’t, except to say that their agent handles this stuff. I was in the middle of writing this post, having just come off the rights fair, when the Donadio & Olson news broke, and I took time out to write that first blog post about the extreme problems with agents. I recommended that writers avoid agents at all costs, and got tremendous blowback, including comments like “I can’t hold an auction for foreign rights without an agent” and other myths.
(Ironically, I was Googling that particular tweet because I couldn’t remember how it was phrased, and saw that a German publisher contacted that same author on Twitter because the German publisher “emailed your literary agent and never got a response.” You cannot make this stuff up. Seriously.)
So, I wrote about the problems with agents and financial mismanagement, ignoring the actual rights licensing and other things they fail to do.
I did meet a few agents at the rights fair. Agents who specialize in licensing the rights to “properties” that are “bankable.” None of the agents I spoke to, briefly, handled books that weren’t already big gaming or big movie projects. (Yes, I spoke to the agents. Research, y’know.)
Here’s the thing:
Indie publishing has disrupted traditional publishing, yes. But indie publishers (and writers who consider themselves self-published) have pretty much built their businesses on the old traditional publishing model.
That model is based on innovations made in the early 1960s. Traditional publishers have not moved off that model at all. This is why James Patterson has his own division (which he runs) inside of Hachette, his U.S. publisher. The article I’ve just linked to here, on that division inside Hachette does not mention licensing outside of the traditional publishing norms of TV/Movie and translation. Patterson has added a few things, like a literacy campaign, but I didn’t see much about other types of licensing.
He’s creative and innovative, but his creative innovations are very 1990s, partly because he’s working inside the traditional publishing industry—which he disrupted (and continues to disrupt) all by himself.
You can see the book industry’s disinterest in this licensing fair just by searching for the word “book” on the website. Chronicle Books and Sourcebooks were there, but not as the companies themselves. Rather, they were represented as part of someone else’s marketing campaign.
I found Penguin Random House’s booth in the armpit of the floor, back in the part with some exhibitors for whom English was not their first language, and some smaller exhibitors like quilters.
Penguin Random House has thousands of properties that could be exploited as brands and for licensing. You’ll note in the photo above that they only focused on three for some inexplicable reason.
The big comic book companies were all present. Marvel and DC were there, of course, and they were hard to miss. But Dark Horse Comics, which has a lot of properties to exploit, had a different strategy, to use my friend’s phrase. They deliberately kept a low profile to make sure whoever found them really wanted their properties. (Says my friend.)
Apparently, in the past, Dark Horse had the big booths as well, and decided it was not worth their time. I have no idea if my friend’s theory is correct, because I didn’t ask. But I found the approach interesting, nonetheless.
A lot of deal-making happened on the floor and behind the scenes. You didn’t need a booth to license properties. I watched a lot of licensing happen throughout my short time there.
My friend said that deals started on the floor of the exhibit got finalized in the weeks afterwards. The key was the short-term connection. You get a name, you figure out that you both want to do a deal, and then you work on it.
I say short-term because this is the world of big corporations, and just because you have the name of someone high up in the licensing department or in that corporation won’t mean squat two years from now. People at that level change jobs a lot, particularly if they don’t “produce” up to some set standard.
One question I asked my friend, though, as I watched people scurry around in their best business attire, was what level of employee manned the booths and walked the floor. My friend owns his own company, but it’s small (a few million annually). He doesn’t have tons of staff.
But a company like NASCAR? Who was representing them?
He says that there were a lot of vice presidents and above, usually in the back of the booth behind closed doors, out of sight of people like me. The head of the licensing divisions were definitely there, and the case of some of the companies, even the big ones you’d recognize, someone with a butt-load of clout (as in one of the main mucky-mucks) was there as well.
It’s a big, big deal.
Why should you care? Because this is the part of the business that built LucasFilm. George Lucas retained his licensing rights when he made the tiny deal for the distribution of the original Star Wars movie. There’s a lot, lot, lot of money in marketing, branding, and licensing, if it’s done right.
You’re all going to ask me what right is. I know some of it—which is how I wrote Creating Your Author Brand—but I’ll be honest. This is all a new level to me. I knew I didn’t know it, but now I’m heading to learn it.
I don’t think writers should leave licensing at this level on the table. But it’s going to require a creativity that writers don’t and can’t see until they understand this world.
That’s why I’m tiptoeing my way in. That’s what this first foray was. A toe in the water of that bigger pond, one most writers/agents/publishers never ever visit.
I learned a few things and had a few surprises.
Let me give you the biggest surprise first. Everyone was amenable to having a conversation. Some people wanted to license rights and others had properties to license. Some wanted to partner up in some way or another; other people just wanted cash.
But everyone knew they were there to make deals that would, with luck, make money for all involved. When my friend, who is good at marketing, introduced me to the people he was talking to, sometimes he introduced me as “my friend Kris,” which was a cue to me and the other person that I was not part of the fair or the conversation.
Many times, though, he introduced me as “my friend Kris, who owns a number of science fiction properties.” Eyes lit up, heads tilted, interest appeared. A few times, people asked for my business card.
I don’t have a paper business card that’s up to date and, silly me, I hadn’t brought any. This licensing world still revolves around that paper business card, which shocked me. I couldn’t even get into the fair without my friend presenting one of his.
I came home with a bunch of business cards (mostly useless to me), lots of paper flyers outlining the properties that someone wanted to sell licenses to, and a few other flyers citing the kinds of things that company bought.
Everything was designed to impress, but that design included a wink and a nod. Each person on the floor—at least those who had been there before—knew that image was only the first step.
But image and branding was all important. It was a licensing expo after all, and most companies were licensing (or acquiring the license to) bits of brands.
Even the small fry who attended paid attention to image and impression. There were at least two different web comic artists there, who were trying to license some of their characters. Neither of the artists seemed desperate. All of them had gorgeous, if inexpensive, displays, and one even had suggested ideas for the characters. As I passed by, I saw person after person stop and talk, even though the comic artist was not even in the same universe as, say, Marvel.
In fact, my friend saw one of the web comic characters and told me he would circle back to the artist, because that character fit into a line of gaming apps my friend had licensed for phones. My friend was going to see if those gaming licenses were available, and if the artist was amenable. I never did find out how that turned out.
The other big surprise was cost. Booths cost money. You have to rent the space, pay for the location, build the booth and the brand, staff it, and on and on and on. The booths, plus advertising fees, pay for the cost of this licensing fair.
If you are a company that licenses properties—someone that will stop at those booths and offer the people behind them cash money to license some aspect of their property, then you get in for free.
Since most of the fair takes place over lunch and dinner and cocktails, at tables around the room, and in various rooms off to the side, the key is to get in. You don’t need a booth.
And if you have a publishing company that demonstrably licenses rights (which is what publishers do) or a gaming company that produces games from someone else’s properties (for example) and you have an EIN (look it up if you don’t know what it is), then you don’t have to pay to enter.
You can then talk to people about the properties you have to license. No one is going to police your badge.
And, after a few years of attending, if you have a lot of money, you might want to have a booth of your own to license the subsidiary rights to your work.
These subsidiary rights aren’t the kind you saw in those Twitter fights. Translation rights will be licensed, but for games or comics or cookbooks or coffee cups. Movie rights probably won’t be discussed here, but I don’t know that for certain especially since I met at least one scout while I was there. (Someone who scouts properties for movies.)
One final surprise—a shock, really—new properties were not prominently displayed here. As I walked in, I walked past a person-high display of Rod Serling’s face with the Twilight Zone logo above it.
This licensing expo is not about acquiring the newest bestest most hyped up thing. It’s about licensing proven properties, some of them decades old. The longer the track record, the more interest from potential licensors.
Established brands and already-proven properties did the best here.
And I know what you’re thinking. If those brands are established, the properties already proven, why were they at the fair?
Because products licensed from established content change almost daily. Think back ten years. How many games existed for smart phones? Not many. Whoever thought that there’d be a poop emoji, and worse, who thought that the poop emoji would get its own pillow? And to delve even deeper, who even knew what an emoji was ten years ago? I think back then we were still calling them emoticons.
Want to freak out? Here’s a list of international trade shows related to licensing for the year. At least two of them were in Vegas in 2018. Two were in New York, one in Miami, and one in Chicago. The rest are scattered around the world.
I’m lucky. I currently live in one of the cities where these events take place. Some of you do as well. See if you can get a chance to walk the floor for free, like I did this year. Scout it out. See what you can learn in just a few hours.
This licensing world is vast, and I’m just getting ready to enter it. I suspect by 2020, I—and by extension Dean and WMG—will know enough to start feeling confident about doing our own licensing of things other than translation rights for books, movie/TV rights, and gaming rights.
I learned how to do those things on my own in the traditional publishing world. But I’m interested in t-shirts and mugs and pillows and the kinds of things I can’t even yet imagine.
I’m really interested in that licensing university attached to the rights fair.
Because the more I learn, the more opportunities I create for myself and my businesses.
Here’s the thing, folks. As baby writers, we all assumed that agents and publishers knew this stuff. They didn’t. Or maybe many of them did in the 1970s. But as the licensing world grew, and as the opportunities grew, the book industry got left behind.
And with all the staff cuts at publishers, there was no one to learn this stuff, no institutional memory, no way that anyone would even get the approval to attend some of these fairs.
That Randy Penguin display was pathetic. Maybe someone was walking the floor for them, but I seriously doubt it. Because up until 2000 or so, the contracts with authors were a mess (from the publisher’s point of view). There was no way for a publisher to know—without checking—what subsidiary rights it even had the right to license. I can categorically state that there were no literary agents at this fair. Not a single one. So, Anonymous Agented Tweeter, your agent is not going to help you here, even though you probably expect her to.
This world of licensing properties is huge. The opportunities that huge world provides those of us who create content is huge also. But huge means overwhelming. And writers aren’t used to thinking about the fact that they play on an international scale.
All of those people who attended that expo here in Vegas learned the world of licensing one detail at a time. Maybe they learned by attending that licensing university. Maybe a mentor helped. Maybe they were thrown into the deep end just to see if they could swim.
My attitude always is this: if all of those people can learn that world, then I can too. I just need patience and an open mind.
I have both.
I also have the knowledge that, as I step into this world, I’m creating opportunities for my writings that no literary agent and no traditional publisher would ever have created for me. They don’t have the time or the inclination to learn all of this—although that’s changing for the publishers which I will discuss next week.
I’m quite excited about this. And overwhelmed because, as usual, when I’m learning something new, I see the vast amount of things I don’t know. But I will eventually learn what I need to know for my business. I’ve done this before; I can do it again.
And, more importantly, I want to.
Because I really do hate leaving money on the table.
If you haven’t already done so, go back and reread last week’s blog post on learned helplessness. Then ask yourself why writers are always told that they can’t handle this stuff. Yes, it’s overwhelming. Yes, it’s hard at times. But so was learning to write. So is learning how to tell marvelous stories.
If you can learn how to do that, you can learn anything, even this. As I usually do, I will be blogging about this stuff as I learn it. It’ll take me at least two years, so don’t expect posts on this topic all the time. But you’ll find an occasional one, mixed in with all of the others.
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“Business Musings: Licensing Opportunities,” copyright © 2018 by Kristine Kathryn Rusch. Image at the top of the blog copyright © 2018 by Kristine Kathryn Rusch.