August 10, 2017

University Licensing Programs

Can you believe summer is almost over and students are heading back to school? Already some local high schools have begun their fall semester. And college students will be back on campus soon. When I began my freshman year of college, I promptly purchased a sweatshirt with the university's name emblazoned across the front. That sweatshirt remains in my closet to this day. The bleach stains and holes in the sleeves prevent it from seeing the light of day as often as it once did. But they also show how well-worn and loved it is, and in no way detract from the comfort of wearing it.

I carefully selected that sweatshirt from a wide array of licensed merchandise available in the on campus bookstore. Many colleges and universities have programs and departments dedicated to managing the licensed use of their marks. These programs both promote and protect the school brands. Sometimes schools work with outside companies to help manage the licensing program. And the licensing programs extend far beyond apparel like my sweatshirt. A university may license its mark for use on office products, fitness equipment, health and beauty products, and a range of other goods marketed to consumers.

According to an article published by the Licensing Industry Merchandisers Association just a few years ago, college licensed merchandise accounted for approximately $4.62 billion worth of retail sales. This suggests the market opportunity for university licensing programs may be lucrative. Sometimes they are. But it is unlikely that every university will reap the extraordinary monetary rewards that certain schools (like University of Texas and University of Michigan, who frequently appear towards the top of lists of top selling institutions) enjoy. Nevertheless, university licensing programs abound. So why do universities typically initiate such licensing programs?

Promote sense of community. Students purchase university branded merchandise to show pride in being associated with the school. Branded merchandise also offers schools a way to stay connected and with alumni. Employees, donors, and other stakeholders in the university also like to display their connection with the school. Sporting branded merchandise is one way individuals promote a sense of community associated with the school.

Exercise control over brand. By starting a licensing program, the university exercises control over the quality of the goods and services offered under the mark and ensures that the students, alumni, prospective students, and other school supporters are receiving the same quality they expect to be associated with the school's brand.

Channel of communication. Licensing programs offer another way to communicate with the school's constituents consistently and effectively. In turn, the purchase, use, and display of those licensed products communicates with the broader public. In this way, a university may raise its profile and highlight its mission.

Supplement revenue stream. The royalty stream associated with licensing programs also supplements the revenues universities derive from other sources, and may be used to support the university's mission through scholarships or other programs.

This fall, my college roommates and I will be attending our twentieth reunion. Undoubtedly we will commemorate that with the purchase of licensed merchandise. While nothing can replace the well-worn sweatshirt from my freshman year, perhaps I can find it a worthwhile companion.