Guest post by Michael Dresner, CEO of Brand² Squared Licensing, the strategic licensing division at Peppercom
The argument is always the same. Anytime we’re preparing for a new business pitch, our team debates how many big ideas we introduce to a prospective client. If the ideas are too voluminous, too good, too detailed, too imitable, an agency risks having the ideas stolen from them.
I take the opposite approach. Put your best foot forward. Always. Good clients will reward you for your enthusiasm and creativity. If they don’t hire you, they’ll act honorably. The bad ones are few. And if a prospect pilfers our ideas without hiring us, they’ll lose in the long-run.
My philosophy was challenged this week. I received a third call, in as many years, from a prospect – a blue chip media brand with international reach - that is uncertain about strategic licensing. Fair enough. Our job in a pitch is not only to give them our best ideas, but also provide objective counsel to help them make the best decisions. When a prospective client is asking the same questions after three years, chances are they’re exploring and not buying. Fair enough again.
One of our key ideas was to extend this brand into the space of airport retail. If you’ve ever seen a New York Times store, or a PGA outlet, or a Fox Sports diner at an airport, those are licensed. Third party operators pay a royalty to those brands mentioned, every time a charge card is swiped. So those alliances can be very lucrative for both parties.
Today, during my third meeting with this prospect, I found out the brand extended into a licensed airport retail concept. The concept opened for business at a top 25 U.S. airport in the last month, and initial volume is so high the operator has leased a second space in a top 5 airport on the West Coast. OK. Maybe the idea stemmed elsewhere coincidentally.
We checked the licensee’s press release however – and it included language our agency drafted in our new business pitch two years ago.
After taking all of this in, I said, Wow. Did you hire someone to help you? No, they said. We spent the last year doing it ourselves.
That’s great, I said. How is the store doing? Well, they replied, we’re not sure.
Did you go to the opening? I asked. No, they responded. We haven’t gotten there yet.
Oh. Well, aren’t you intrigued by what it looks like and who’s shopping there? I asked.
They chuckled and said the manager keeps promising to send pictures.
I still believe the bad ones are few, and in the long run, they will lose. But I have a few (final) words for this particular prospect. And these are ideas you can steal:
You had multiple chances to candidly tell us you couldn’t retain a 3rd party agency but had an opportunity to move forward with one of our ideas nonetheless. That would have stung, but not like this. As a gesture of good faith we might have helped you.
All of the work we showed to you had a copyright on it. You have in-house counsel. We met them. We’re not going to sue you. Just sayin’.
Most importantly – Let’s say you extend a brand with decades of global viewership into the hands of a 3rd party retailer – and spend a full year on the alliance. You aren’t able to fly three hours to visit the store location, look behind every fixture, review every category for sale, watch each employee as they represent your equity to hundreds – thousands – of airport travelers newly experiencing your brand. This basic due diligence is as good a reason to hire an outside firm as I can imagine. It’s an example of the many agency services we provide to clients. The best (brand) managers know their bandwidth, recognize what lies outside their time or expertise, and hire the right resources to do good work. Otherwise pitfalls abound.
I sincerely hope this idea flourishes – we worked hard on it, and on some level it would be fulfilling to watch. But if it fails in execution, this prospect made its own bed. And, regretfully, they’d get what they deserve.