1. The Evolution of Licensing and What It Means to Our Business Strategies
Society for Scholarly Publishing
May 28, 2003
Alma J. Wills, Partner
Kaufman-Wills Group, LLC

2. Kaufman-Wills Group, LLC
“A channel of distribution shall be considered to comprise a set of institutions which performs all of the activities (functions) utilized to move a product and its title from production to consumption.”
Kotler, page 412
Kaufman-Wills Group, LLC

3. Kaufman-Wills Group, LLC
“…the channels chosen for the company’s products intimately affect every other marketing decision.”
Kotler, page 412
Kaufman-Wills Group, LLC

4. Traditional Channels Subscriber Publisher Publisher Subscription Agent
Institution

5. Kaufman-Wills Group, LLC
“Channel institutions, like products, are subject to life cycles. A particular channel institution may emerge suddenly, enjoy rapid growth, reach a point of relative maturity, and eventually move into a period of slow decline. A major force behind the channel life cycle is changing economics, which makes new combinations of marketing functions suddenly more efficient than previous ones.”
Kotler, page 421
Kaufman-Wills Group, LLC

6. Licensing Opportunities

7. Today’s Channels Subscription Agents
Author & Commercial Reprint Services
Hosting Service(s)
Document Delivery Services
Aggregators
Portals
International Publishers
Publisher
Other Associations/Publishers

8. Kaufman-Wills Group, LLC
“When new institutions first appear, the typical pattern is one of institutional conflict, followed by accommodation.”
“Another important channel development is the movement of companies toward developing multichannel systems that reach the same or different markets, where some of these channel systems are in competition with each other.”
Kotler, pp 422 & 427
Kaufman-Wills Group, LLC

9. Revenue Sources Mid-1990’s vs. 2003
Kaufman-Wills Group, LLC

10. Kaufman-Wills Group, LLC
“Content vendors are struggling to come to grips with new forms of aggregation, and new methods for integrating content into software and workflows. At the root of all these problems is the collision between what users want to do, and what content vendors allow them to do.”
Outlook 2003: Issues on the Information Marketplace. ©Outsell, Inc. December 18, 2002
Kaufman-Wills Group, LLC

11. Observations “Over the transom/order takers”
Small, single title publishers
“Over the transom/order takers”
Going it alone
Price too low
Fear cannibalizing existing channels
Using others’ platforms (i.e., HighWire)
Few economies of scale
Large, multi-title publishers
Dedicated staff & business units
Partnering (sometimes)
What the market will bear & more
Fear cannibalizing existing channels
Proprietary platforms
Able to spread resources over many titles.
Kaufman-Wills Group, LLC

12. How Many Channels Do You Need?
It depends on your publication and the breadth of distribution you are seeking:
Exclusive Distribution
Intensive Distribution
Selective Distribution
Kaufman-Wills Group, LLC

13. What Does Licensing Mean To Your Business?
Licensing is the fastest growing line item on your financial statement.
Margins are high because you have already paid to develop the content.
It deserves as much focus as the other aspects of your business.
It’s labor intensive and requires dedicated staff or subcontracting.
Kaufman-Wills Group, LLC

14. Kaufman-Wills Group, LLC
What to do?
Kaufman-Wills Group, LLC

15. Develop a plan. Think cost/benefit.
Identify potential licensors
What services do they offer? Features?
Who are their customers?
What is their reputation?
Are there costs?
Will you need additional staff to work with them?
Revenues?

16. Organize for opportunity --- not ink on paper --- set goals

17. Be where your potential users can easily find you --- or they will use other content
Do a Google Search & see what comes up
Get listed in databases, indices & bibliographic services
Link with related websites
Document delivery services
Press releases

18. Cast a wide net --- but be selective
Know your service provider
Scrutinize agreements
Talk to others and check references
Ask for modifications

19. Seek out revenue generators and awareness creators
Make sure that each alliance brings value to your publication.
Keep in contact with vendors. Let them know you expect value.

20. Look for strategic alliances
Partner with other organizations to build critical mass of content.
If you can’t or don’t want to do it yourself, find a service provider.