Last week, our CEO and founder, Kalle Törmä had the distinct honor of being invited to speak at the Zenith China IP Licensing Training Camp. The first-of-its-kind in the region, the week-long event saw Törmä and other licensing thought leaders travel to Shanghai, Nanjing, and Beijing to share their wisdom and to get an in-depth look at one of the world’s most exciting consumer markets.
Despite being the world's second-largest retail and consumer market, China is still working to grow its licensing businesses. Language barriers, local and international politics and more have created a gulf between licensing professionals in China and those in the west. For the last few years, industry leaders on all sides including Licensing International and The Global Licensing Group at Informa have been working to host events and facilitate partnerships to help bridge the gaps. Zenith China IP Licensing Training Camp is one such program.
Törmä poses before a Zenith Licensing banner with Mark Caplan, Kate Wang, Edmund Stern, Li Zehn and more
In each city, Kalle shared his expert opinions on nurturing and sustaining a successful licensing program with an audience hungry for best practices for growing and sustaining global licensing businesses. Based on his licensing operations management thesis and his first-hand experience, Kalle’s presentation tackled the industry’s biggest challenges as well as its successes. The presentation was offered in both Mandarin and English. When he wasn’t presenting, Kalle had the opportunity to walk the show floor at local industry-focused events including the Nanjing Copyright Trade Fair.
Talking to fellow attendees and exploring shows helped Kalle zero in on the issues preventing Chinese licensees and western Licensors from working together, chief among them: clear communication. “Licensing companies must overcome communication barriers if they want to have business relationships built on trust and transparency,” he says.
To survive, parties on both sides should make use of the latest technology. Systems that can be localized for both partners can make communicating complex ideas and minor tweaks a breeze, eliminating the need for lengthy email chains or third parties (a hassle even if you are speaking the same language). Flowhaven is available in a wide variety of languages including Mandarin, Cantonese, Japanese and other regional dialects.
Some attendees mentioned a need for tools that help them analyze deals more clearly. Instead of lengthy spreadsheets or short reports that leave key details out, software that allows you to look at deals at each and every stage with detailed analytics can help you measure the success of your deals and answer questions more easily. Flowhaven is powered by data, offering up to the minute reports about royalties, minimum guarantees, and profits. Because our software is available on all mobile devices, you are always one click away from understanding if your deal was a success.
In addition to needs, Kalle also observed key opportunities for growth. The country, known for its love of character-driven brands and detailed storylines is interested in new properties that will excite its increasingly-powerful consumers. The country generated $8.072 billion of licensed merchandise sales in 2017, placing it fifth behind the U.S., U.K., Japan, and Germany, according to Licensing International. But, with a population of 1.36 billion people and a growing middle and upper class, the market has the potential to supersede its competitors. Because the licensing industry is still growing (and being refined) in China, brand owners in the west have the ability to try new tactics and test new products to see what works most effectively. Flexible software, like Flowhaven’s, can support brand owners as they experiment with new collaborations and deliver detailed reports about the success and failures of each.
For those skeptical about expanding in China consider this, in 2017, the market experienced 10 percent growth, exceeding 36 trillion yuan ($5.69 trillion). Disposable personal income increased 130 percent from 2008 and retail contributed to 60 percent of China's economic expansion, according to the country's National Bureau of Statistics. E-commerce saw a boom with saw sales increasing by 32 percent to $7.18 trillion in the same year and 43 percent increase over 5 years, with online sales accounting for one-fifth of total retail in the region. Chinese consumers and businesses are eager, monied and interested in how tech can improve their lives.
It can be exciting to expand into new territories, but no professional should do so without the tools and insights to make sure they are met with success. Tools that can help you communicate effectively with local partners, send updates quickly, look at detailed reports and generate charts can make the difference.
To learn how Flowhaven is helping companies around the world work together click here.