Three tips on licensing from Nicolas Loufrani, CEO of the $573 million Smiley brand:
- Identify potential manufacturer partners that complement your brand equity and product concepts, then inquire, ‘What can I bring to you so we can work together?’
- Tap consumers to help tell your brand story on social media: ‘It’s impossible for a brand to be relevant today without being part of the cultural conversation.’
- Don’t let the naysayers deter your vision but be nimble enough to adapt your idea when necessary to turn a ‘no’ into a ‘yes.’
Nicolas Loufrani, the CEO of The Smiley Company, the global business behind one of the biggest licensing success stories of the past 50 years, says the best advice he can give about licensing success is don’t always listen to someone else’s advice.
Loufrani, who manages the $573 million company built on the Smiley image – a yellow circle with a smiley face – gave a speech to design students recently and was asked what guidance he could share about building a licensing powerhouse.
“Just find your own way,” he told the students.
Loufrani, as he revitalized the licensing company created by his father in 1972, had to ignore the advice of naysayers in the licensing and manufacturing worlds who told him the smiley face image was a has-been. “They were telling me it’s old, it’s past, it’s not relevant,” he told CO—.
Now, as the company is celebrating its 50th birthday with collaborations with top designers and artists and the launch of its “Collector’s Edition” products in upscale department stores around the world, including Nordstrom, some of those same skeptics are telling Loufrani, “I would never have imagined you would have made it so big,” he said.
Loufrani’s father, Franklin, started the company after designing the now-famous yellow smiley face logo for a French newspaper that used it to highlight good news stories with the phrase, “Take Time to Smile.”
Nicolas Loufrani joined the company in 1996 and helped transform the company from a mass market, somewhat tired property to a global brand that has collaborated with Karl Lagerfeld, Moschino, Louis Vuitton, Fendi, Armani and other luxury designers.
Smiley licensed products are now sold in tens of thousands of retail stores, with over 68 million items sold annually. In 2021, the company launched 15,000 products and it has grown by 70% over the past two years. It has an upscale designer line, Smiley Originals, as well as a Smiley World mass market line.
Along the way, Loufrani learned these lessons about how to win at licensing:
We have entered into the world of hyper-collaboration, where all the brands are doing collaborations because they need storytelling, they need to keep refreshing their offerings all the time.
Nicolas Loufrani, CEO of The Smiley Company
It’s not enough to have one good idea: You need to constantly reinvent yourself
Every season The Smiley Company produces more than 25 style guides and hundreds of new product concepts for its manufacturing partners.
“We reinvent the graphic direction based on the latest trends,” while remaining true to the brand’s core values of creativity and positivity, Loufrani said.
Find the right partners, and share your ideas for products and campaigns with them
Art-based properties like Smiley can’t sit back and wait for manufacturers to come to them, Loufrani said. His company develops creative ideas for Smiley products, then pitches them to manufacturers and brands it wants to collaborate with.
The company has category specialists for food, fashion, accessories, toys and other product areas who develop concepts for appropriate partners.
“We will say, ‘OK, I want to be in that market, so who is the partner to be with in that market?’” Loufrani said. He will then approach that partner and ask, “What can I bring to you so we can work together?”
“And when they work with us, suddenly they sell ten times as much,” he said.
“Beyond our ability to create nice designs, we have the ability to create incredible marketing campaigns,” Loufrani said.
[Read: 3 Startups in Fast-Growing Niches Detail Plans to Accelerate Business in 2022]
Help brands with their storytelling: ‘We have entered the world of hyper-collaboration’
In the social media world, brands need to do more storytelling with consumers, Loufrani said, and an iconic licensed image can help with that.
“With social media, brands have become friends, so brands have to talk to you, they have to come up with nice stories to keep you following them,” he said.
“We have entered into the world of hyper-collaboration, where all the brands are doing collaborations because they need storytelling, they need to keep refreshing their offerings all the time,” Loufrani said.
A partnership with Smiley lets brands do storytelling about Smiley’s message of positivity, or refer to its long history with vintage designs, or connect with cutting-edge artists and designers for new interpretations of the Smiley face.
“It’s impossible for a brand to be relevant today without being part of culture and the cultural conversation,” he said.
Don’t let the naysayers discourage you — but amend your ideas when necessary
“Whatever you come up with, people are going to be negative. Most of the people are going to tell you no, they are going to give you good reasons why it’s not going to work,” Loufrani said.
Resilience is a crucial trait for those seeking to create a licensed brand, he said.
Loufrani has current licensing partners that took him 15 or 20 years to sign. “I’ve signed so many companies that were telling me no for years or even decades,” he said. “You have to think positive.”
“Everything that’s around you started as an idea. The difference between the idea and the realization is just someone who was thinking positive and believed that he was going to make it.”
But along with positivity, he said, you have to be able to adapt your idea to turn a no into a yes. “The people who were saying negative things to me year after year, they also made me amend my offering,” he said.
Don’t rest on your laurels or legacy
Just because your licensed brand has been around for 50 years doesn’t mean you are guaranteed to be around for another 50, Loufrani said.
“There are ideas that were very big when they were 50, and now they are meaningless,” he said. “Who talks about Felix the Cat anymore, or Bozo the Clown,” he said. “Brands disappear every day. You always have to reinvent yourself and try to survive,” he said.
CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.
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