Trademark Licensing*

Trademark licensing is an arrangement by which a trademark owner allows another party to make and distribute specific products or services under agreement.  Such an arrangement can be a very lucrative option for trademark owners. The more popular the brand, the more licensing revenue it can generate for the mark owner.

For example, in the alcoholic beverage industry some companies have experienced the most recent growth in their brand extension lines of business by utilizing trademark licensing arrangements. Brand extension is the movement of a company into lines of products that are not part of the company’s core offerings.  It is a potentially profitable way for companies to use the trademarks that have been successful with their core business.

JACK DANIEL’S, a popular whiskey trademark, has been licensed to both food producers and restaurant franchises like TGI Friday’s, as well for barbeque sauce.  Additionally, JIM BEAM has been licensed for spice rubs and sauces, GUINNESS for truffles, KAHLUA for coffee, and BAILEY’S IRISH CRÈME for ice cream. Most brands have also extended into promotional items, including clothing, drinkware, and other products.  Such brand extensions are generally accomplished through licensing agreements because the new products are not the core manufacturing products that the company has the capability and capacity to produce.

Trademark owners should consult with legal professionals to learn more about how a properly structured license can lead to valuable revenue streams, including through brand extension.  Contact the team at Tracy Jong Law Firm today!

*This article includes information discussed in the Buffalo Intellectual Property Law Journal article “Trends to Note in Alcoholic Beverage Trademark Law That Can Impact the Decision Making Process For Businesses At Critical Points In The Alcoholic Beverage Product Life Cycle.” Written by attorneys from Tracy Jong Law Firm, the publication covers much general information about trademarks as well.