Data-Driven Decision-Making

Licensing has become more data-driven over time, as the tools used to analyze sales and other information at a granular level improve, giving licensors and licensees insights into what is working and not working and enhancing the ability to tweak strategies quickly.

Licensing executives have also increasingly been enhancing sales history with other more forward-looking data, from monitoring social media patterns that suggest what kinds of products, themes, or designs would appeal to fans, to utilizing crowdfunding and innovation platforms that predict whether customers would want to buy specific new products. At the same time, the data that licensing companies collect from their consumers, and how they use it, has become ever more sophisticated. Personal styling site Stitch Fix, for example, has said it employs more than 75 data scientists to scrutinize more than 85 meaningful customer data points (such as fit preferences).

A number of individual licensing deals forged recently have been billed as “data-driven,” with customer searches, social media chatter, browsing history, ticket sales, and other predictive data being used to inform product development within the context of the agreement. The idea is to anticipate consumer trends and capitalize on them in a timely manner.

Some examples:

  • Puma partnered with Amazon on an athleisure program under the Care Of by Puma brand, with product development informed by Amazon customer review and search data. The initial collection, which was piloted in Europe, included 50 items in a range of colors.
  • The Major League Soccer Players Association, represented by REP Worldwide, paired with BreakingT for player-identified merchandise, available initially through BreakingT’s website as well as Bleacher Report and Amazon. Product designs are influenced by social data that can identify trending players and hot market or micro-moment opportunities. (Major League Baseball also has a similar agreement with BreakingT.)
  • Online lifestyle platform PopSugar forged a clothing deal with Kohl’s, described as an “innovative, data-driven apparel collection” that leverages the Kohl’s “speed-to-market model.” PopSugar contributes predictive insights from its customer data, including search, browsing, and clicking history, to assist in the design process.
  • Fanatics’ 10-year deal with the University of Miami, announced in August, not only includes rights for Fanatics to make, sublicense, and distribute Miami Hurricanes’ merchandise. It also gives the institution’s athletic department a Fanatics-funded data analyst to cull insights from Fanatics data as well as ticket sales and donations. Miami has been represented for licensing by Fermata College, now part of Fanatics College, since 2014.
  • Bring Me the Horizon, a U.K.-based band, launched a personalized t-shirt range that uses Spotify listening data to create the right t-shirt for customers. The products are available on a dedicated site called amo in colour, based on the name of the band’s new album amo. Visitors to the site are prompted for their Spotify log-in data and asked to select their favorite half dozen tracks from amo. That data is combined with the customer’s Spotify listening history and results from a music intelligence platform called The Echo Nest that analyzes energy and sound preferences. The information, which pertains to the listening history for this band only, generates a t-shirt design that combines a band logo with one of 10 color patterns tailored to the customer.

The data-driven licensing deals mentioned here represent yet another tool to help licensing executives predict and supply the types of products their customers want.

A reminder that Raugust Communications’ next e-newsletter will reach subscribers’ in-boxes tomorrow, Tuesday, November 19, 2019. The Licensing Topic of the Month touches on “circular fashion” and the ramifications for the licensing business, while the Datapoint research spotlight focuses on the reasons licensors select partners for collaborations. If you have not yet signed up for this free publication, you can do so here.

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