A smart team and a slow-and-steady mindset have helped this dynamic licensing company reach the top and are fueling its plans to grow its international presence. In the last five years, some big changes have come to Global Icons, the global licensing firm Jeff Lotman founded 14 years ago. The company, which has an annual growth average hovering around 25%, completed a major acquisition of another licensing firm in 2005 that brought in a few significant clients, specifically Build-A-Bear Workshop.
“We were able to rebuild a licensing program that was performing poorly at retail and made Build-A-Bear Workshop into a multi-million royalty business,” said Lotman, CEO. “Our success and our relationships with the people behind that brand led us to a number of highly successful contracts in the ensuing years, like Cold Stone Creamery and Mrs. Fields.”
Since that time, Lotman, Bill McClinton, the senior vice president of licensing, and Mike Gard, COO, reviewed Global Icons’ portfolio to find new opportunities. Lotman said he, McClinton, and others at the company had extensive experience in food manufacturing and licensing of food and restaurant brands. They decided to focus the company’s energy in tapping the great opportunities there, the largest of all licensing sectors.
Dannon was another key food sector client to join Global Icons in the last year; more recently, the company won contracts with Horizon and Silk. McClinton said there are unique challenges associated with licensing an organic brand and one that specializes in such a unique product as soy, but that the company is up for the task.
“It’s very exciting because both of these brands enjoy an extremely loyal fan base,” he said. “Our task is to find new categories that those consumers will be drawn to or that fill their needs.”
Lotman explained that these brands are now in the first phase of the Global Icons process: brand assessment. As he and his team sometimes do, they started gauging these brands’ equity and standing in the market close to home.
“I’m a Horizon customer already, so I understand why people are excited about high-quality, great-tasting, organic dairy products. I also spent some time talking to people who either enjoy Silk or need soymilk as part of their diet and found an almost limitless enthusiasm for the brand,” he said.
After the company assesses these brands, it will move into the second phase of its process where its team works closely with the brand to develop a licensing strategy that aligns with the core business goals. Lotman said this creative planning, critical to the development, is one of the unmatched strengths of the company.
“We become brand stewards in the truest sense of the word, saying no to a deal before even taking it to our client because we already know it isn’t a good fit,” he said.
McClinton added that Global Icons doesn’t try to close as many deals as possible in the shortest amount of time. “We put our clients first and hold out for solid, long-term partnerships that benefit everyone,” he said.
One example of this protectiveness was the company’s work with Baileys Irish Cream. McClinton explained that the client wanted any licensed product to incorporate the beverage as an ingredient rather than one developed through a flavor house. The reason for this was to truly deliver the brand experience: the smooth dairy drink with a whiskey after taste. To do any less, in its eyes, would be to devalue the rich history of its brand. Without the option of using a developed ingredient, McClinton and his team had to turn away a number of interested brands that weren’t willing to invest in the R&D to make the product work with the beverage.
In the end, Global Icons closed deals in premium ice cream, chocolates, and frozen prepared desserts. They all turned out to be highly lucrative, proving the point that it pays to wait for the right partnership.
Lotman also highlighted a few more recent deals Global Icons made. It recently united Honda with a helmet manufacturer, which turned out to be one of the most challenging deals the company ever completed due to the sensitive liability issues involved. This quarter, another of its clients will be breaking into an emerging field: Crock-Pot will launch a line of fully prepared refrigerated meals manufactured by Harris Food Group. And Lotman said the company’s work with Duraflame to launch electric fireplaces and heating appliances by Twin-Star International was one of the most interesting deals he’s worked on.
“We love the food category, but there is also strength in working in a broad range of industries,” he said. “So we focus on looking for brands that are number one within a certain niche.”
Steps three and four of Global Icons’ process involves executing the strategy and monitoring a brand’s performance. That’s where the experience and knowledge of people at the company come into play, according to Lotman. He said from the beginning he’s hired people smarter than him and then stepped out of the way.
In the licensing industry, most people don’t stay at one firm more than three years, but the average tenure at Global Icons is five, though many people at the company have been there for eight years or more. Lotman attributed that to a culture that values creative thinking and collaboration. “Everyone here has the opportunity to try a new idea, and if it doesn’t work, that’s okay. That mindset might have resulted in slower initial growth for us, but our success today proves to me it was worth it,” he said.
His confidence in this model is why Global Icons is looking overseas for growth in the next few years, particularly in Asia, Europe, and South America, where small but growing licensing markets are getting attention. And the company has another unique idea for a licensing firm: owning a brand. Lotman said the company already has financial support, but he and his team are taking their time finding the perfect brand with a rich history that could use some sprucing up.
“It’d be great to use our talents to bring an older brand with strong equity back to a more vibrant life, so we’re definitely in the market. There is a lot of opportunity out there, and we’re excited to have a part in it,” he concluded.