Anyone here doing licensing?

by wb_man
8 replies
So I was reading some threads here and someone mentioned licensing as a great way to make a lot more money than selling services like SEO and lead generation.

From what I've read, licensing is a complete done for you system that you offer to businesses?

How is it different vs selling SEO, lead generation, web design, PPC, etc?
What do you actually do exactly? All of the above and more?
Do you also do offline stuff like direct mail and radio?
How do you offer it to businesses? Obviously it's going to cost a lot so they want know where their money is going.

I'm just trying to get an idea of what it is exactly and how to do it.
#licensing
  • Profile picture of the author MRomeo09
    It's possible you read one of my posts. I used to do a lot of licensing- I don't anymore. But that was my focus for about a year or two. Now, I use the same concepts but only for companies in which I have a financial stake.

    The basis comes from Bob Serling's Million Dollar Licensing course. I paid $2,000 for it in 2009. On occasion you can get a copy of it on Ebay for $300-500. In fact there is one on there right now(it is not mine). Also some of my background comes from a very deep grounding in Jay Abraham- I've probably spent $100k to go to seminars and buy courses from Jay. The best thing I can recommend is an extremely hard to find book of Jay's called From Mediocrity to Millions. I can't recommend that book enough. I have NO idea how to buy it. I bought it at one of his seminars, and have probably read it a dozen times.

    In essence what I licensed were proven marketing campaigns. I always use plumbers as my example, even though in this case it's a horrible example. How about I use YOU as an example. I'm assuming that you're interested in building an offline consulting business. I don't know your name so I'm going to call you Bob.

    Bob, I know you're building your online marketing consultant business. I've actually worked with half a dozen businesses just like yours. In fact, we've spent over a million dollars in marketing building up businesses just like yours. We've found what works and what doesn't work. What I can deliver to you is a proven campaign to bring you at least 5-10 new clients a month, guaranteed. Good clients, better than most you already have. Clients that are willing and prepared to spend upwards of $25k a year on your services. This isn't just some idea I dreamed up, this is proven, we've honed this system to perfection through trial and error and a lot of cash that you won't have to waste. So that now today Bob, I can explode your business at just a fraction of the cost it would take to do it yourself. And best of all, we'll do it all for you. You'll have to deliver the service, but our campaign puts your client generation on auto pilot. What do you think Bob? When would you like to get started?


    That's in essence the pitch for licensing a marketing campaign. That's almost exactly what I did. If you were an offline consultant making at least $100k a year(I wouldn't target you otherwise). And I offered to make that happen for a $10k setup fee(that sometimes I finance), and $5k a month. You'd be insane not to take me up on it right? That's what you do with licensing proven marketing campaigns. Basically you set up the deal so that you get paid a quarter for every dollar that your client makes. You make it as much of a black box where they give you money and at the other end you spit out cash as you can.

    To directly answer your questions:
    How is it different vs selling SEO, lead generation, web design, PPC, etc?
    Well I trust that's self evident. You're not selling a service, you're selling a proven marketing system. That's been proven with other people's money.

    What do you actually do exactly? All of the above and more?
    It's up to you, whatever works and produces results.

    Do you also do offline stuff like direct mail and radio?
    Sometimes. I did a fair amount of billboards for a certain niche I worked in as part of a complete campaign.
    How do you offer it to businesses? Obviously it's going to cost a lot so they want know where their money is going.
    Did I answer that above? I'm pretty sure I did.

    HTH
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    We do not have to become heroes overnight. Just a step at a time, meeting each thing that comes up ... discovering we have the strength to stare it down. - Eleanor Roosevelt

    Your opinion of yourself becomes your reality. If you have all these doubts, then no one will believe in you and everything will go wrong. If you think the opposite, the opposite will happen. It’s that simple.-Curtis Jackson- 50 Cent
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  • Profile picture of the author trader909
    Is this just an example or did you actually do this?

    And how do you get actually closed sales as opposed to leads.

    Bob, I know you're building your online marketing consultant business. I've actually worked with half a dozen businesses just like yours. In fact, we've spent over a million dollars in marketing building up businesses just like yours. We've found what works and what doesn't work. What I can deliver to you is a proven campaign to bring you at least 5-10 new clients a month, guaranteed. Good clients, better than most you already have. Clients that are willing and prepared to spend upwards of $25k a year on your services. This isn't just some idea I dreamed up, this is proven, we've honed this system to perfection through trial and error and a lot of cash that you won't have to waste. So that now today Bob, I can explode your business at just a fraction of the cost it would take to do it yourself. And best of all, we'll do it all for you. You'll have to deliver the service, but our campaign puts your client generation on auto pilot. What do you think Bob? When would you like to get started?
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    • Profile picture of the author MRomeo09
      Originally Posted by trader909 View Post

      Is this just an example or did you actually do this?

      And how do you get actually closed sales as opposed to leads.
      Not with offline consultants, although I suppose I could have. I worked with multiple location retail spaces. This is almost exactly the pitch I used with them. I just altered it to make it more relevant for the message board.
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      We do not have to become heroes overnight. Just a step at a time, meeting each thing that comes up ... discovering we have the strength to stare it down. - Eleanor Roosevelt

      Your opinion of yourself becomes your reality. If you have all these doubts, then no one will believe in you and everything will go wrong. If you think the opposite, the opposite will happen. It’s that simple.-Curtis Jackson- 50 Cent
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  • Profile picture of the author Richard Tunnah
    Licensing is a general term to describe allowing someone to use your goods or services for a percentage of the sale or a fee. Companies like Disney make millions from licensing the rights to manufacture their copyrighted toys.
    My godfather has made 8 figures from designing surfing shoes and licensing the rights to make and sell said shoes to adidas. He gets a small percentage of each sale..think it's like 10 cents on the dollar but 10's of thousands are sold each day around the world.
    Now back to licensing for businesses as a consultant. It could be anything you can provide them in exchange for a percentage of the profits they gain from your knowledge. I too took Bob Serlings course and today it's part of my business. Bob has just released MDL2 Profit Alchemy
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  • Profile picture of the author Huskerdarren
    someone was kind enough to take From Mediocrity to Millions and turn it into a PDF. It's searchable on Google.
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    • Profile picture of the author wb_man
      MRomeo09: yes, I was reading that lead generation thread and came across your licensing post. I didn't know anything about licensing until I read your post. It's still new to me so I'm trying to study it and learn more about it. I will look up Bob's course and Jay's book to see if they can help me understand how to do licensing.

      A few more questions (sorry if I'm repeating the same question, maybe I don't get it yet ):

      1) Ok, so licensing is kind of like a complete done for you system that is guaranteed to help businesses get more customers/clients, right? You offer them a proven marketing system that will help them make more money. I currently offer services like lead generation, website conversions, ad management, etc and I focus on giving them a return on their investment. Do you think I'm halfway there towards doing licensing? What's the difference between licensing agreements and consulting contracts?

      2) What types of businesses should I work with when doing licensing? I assume businesses that are spending money on marketing and have a high customer lifetime value, right? Any particular niches you've had success with? Does your marketing system work for all types of businesses?

      3) How do you determine how much to charge them? It seems like you charge a setup fee plus a monthly fee. Why charge $15k instead of $10k or $20k? Do you also charge a % of their revenue generated from your marketing system? If you do, how do you track it, like how do you know they are telling you the truth?

      4) Do you guarantee them anything? Such as at least 10 new customers/clients per month? What happens if you don't deliver? How do you do your licensing agreements? Some modified template or use a lawyer?

      5) How much time do you have to spend to do all the work? You are doing a complete marketing system for them so obviously it's going to involve a lot of work. Things like researching their business/customers, generating leads, setting up email campaigns, etc? Do you do all of it by yourself or do you outsource / hire employees?

      6) You said you already sold your licensing business. How did you set up your business to be able to sell it (business license, llc/corp, website, etc)? I don't understand the process of how to actually sell a licensing business like yours. I hope you understand what I'm trying to say here.

      ------
      I'm really curious about licensing so I want to learn as much about it as possible. I think it is my next step...
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      • Profile picture of the author MRomeo09
        I suppose it would be beneficial to talk about how I got started in licensing to my first niche. Basically I took one client and blew them up, and then rinsed and repeated. I had a client who I was originally only doing a website for. Then I ended up taking over her PPC. I helped her split test billboards. We did some newspaper advertisements. Direct mail campaigns, etc. Good client, two locations paid me $1k per location. Was my client continually from day one to the day I sold my company. If I still offered services, she would be religiously paying me $2k a month today. I don't.

        I took this information and boiled it down into a done for you system. PPC, high converting website, phone scripts, follow up emails, billboards, etc. And started licensing it kind of like I talked about above for $10k down, and $5k a month. Generally speaking, I want to shoot for around 20-30% of their revenue in my pricing. If I bring you $400k a year, I'd like to make $100k of that. I worked with multiple location owners. My ideal prospect was an owner with 5-25 locations. The numbers ramped up pretty well.

        My problem was just as I started getting rolling implementing all of this, I became really ill. Over six months I had 4 surgeries. I lost a fair amount of my business. I sold my business to "retire" but then really liked the process of negotiating selling my business. Spent a lot of time with the business broker, found out some very interesting things. Realized I literally left millions on the table when I sold. My business was unique in that I produced a lot of revenue with a very small head count. But it was hard to value because it was so unique. I did so many different things, and had income coming in from dozens of sources. For instance next to my licensing deals were options I owned on Real Estate. I just wanted out. I wasn't sure I was going to recover my health, or if this was just going to be end stage for my disease. Thankfully, I'm healthy now.

        Now on to specific questions.

        Originally Posted by wb_man View Post

        MRomeo09: yes, I was reading that lead generation thread and came across your licensing post. I didn't know anything about licensing until I read your post. It's still new to me so I'm trying to study it and learn more about it. I will look up Bob's course and Jay's book to see if they can help me understand how to do licensing.
        Bob's MDL2 is $497- thanks for the link above. That's a screaming deal. If you're interested in anything I do, I'd run out and buy that immediately. Honestly though it's more for the advanced offline marketer. I've been doing this business with dozens of clients over years.

        1) Ok, so licensing is kind of like a complete done for you system that is guaranteed to help businesses get more customers/clients, right? You offer them a proven marketing system that will help them make more money. I currently offer services like lead generation, website conversions, ad management, etc and I focus on giving them a return on their investment. Do you think I'm halfway there towards doing licensing? What's the difference between licensing agreements and consulting contracts?
        Yeah, you're more than halfway there. If you're doing that for a Plumber in Des Moines, there's no reason you can't do that for a Plumber in Miami. It's all about the positioning. The keys in my mind.
        1. It's done for you. Black box that produces customers.
        2. It's proven. No smoke and mirrors, no bullshit. Give them the phone number to one of your clients. Show them that it has worked for someone else.
        3. Layout all the money spent using your campaigns. The big number really works. Look at Kern/Deiss Black Friday campaign with $30M spent on 80 different companies. Exactly like that.
        4. Only pitch to companies that can take advantage of what you have to offer. The one man shop can't do it. I want to work with the plumber with 4 trucks in the field who would love to have 8.

        2) What types of businesses should I work with when doing licensing? I assume businesses that are spending money on marketing and have a high customer lifetime value, right? Any particular niches you've had success with? Does your marketing system work for all types of businesses?
        I'm under a five year NDA and non-compete from the sale of my business. So I have to be careful of how I talk about what I did. I can talk in general terms but cannot discuss in specific my clients or my niche. But you already have an idea, it's multi-location specialty retail(sort of). I think it's about businesses that you can produce results for that are fairly easy to get access to. I hate dentists because they are arrogant pricks who you can't get on the phone regardless of how you can help them.

        3) How do you determine how much to charge them? It seems like you charge a setup fee plus a monthly fee. Why charge $15k instead of $10k or $20k? Do you also charge a % of their revenue generated from your marketing system? If you do, how do you track it, like how do you know they are telling you the truth?
        I like 20-30% of the revenue generated. I over deliver. I know my niche. I know what the spend is, I know how to keep ad spend reasonable. In reality if they implement everything I say, I'm getting around 10% of the revenue I generate. And if they are idiots and do nothing I say they are paying 30%. I tell them that right up front. On occasion I have done licensing deals where I do actually get a fixed percentage of the revenue generated. In that case, they agree to disclose their books. If they believe you, they will be willing to do almost anything to get that extra revenue. Understand many times the stuff I provide is incremental growth without a corresponding increase in overhead costs. So if I generate an additional $500k in revenue, and charge them $100k for that. They are still probably getting around $250-300k straight to their pockets. This is a great deal for them. Plus increasing the value of their business.

        4) Do you guarantee them anything? Such as at least 10 new customers/clients per month? What happens if you don't deliver? How do you do your licensing agreements? Some modified template or use a lawyer?
        I had a pretty decent licensing agreement. 3 pages. Fairly simple. My guarantee was 100% money back in 30 days if they weren't satisfied. Charge less up front. Shoot for 10%, get your "black box system" perfected. And then you can literally turn it on in any market and print money. It's always about providing more value than you could ever get paid for.

        5) How much time do you have to spend to do all the work? You are doing a complete marketing system for them so obviously it's going to involve a lot of work. Things like researching their business/customers, generating leads, setting up email campaigns, etc? Do you do all of it by yourself or do you outsource / hire employees?
        It seems like you don't get what you're doing yet. I'm pretty much taking what I have already proven to work for a Seattle plumber and applying it to a plumber in Charlotte. There is no researching involved. I'm not guessing. I've done it. High converting website that I own, branded to the new client. PPC campaign copied over. etc, etc. It was all setup by a project manager. After outsourcing costs, the setup fee was generally 90% profits. I'm lazy, I surely wasn't doing it. I'm an idea guy.

        6) You said you already sold your licensing business. How did you set up your business to be able to sell it (business license, llc/corp, website, etc)? I don't understand the process of how to actually sell a licensing business like yours. I hope you understand what I'm trying to say here.
        It was all in an LLC. Sold it all in one fell swoop. The biggest thing was trying to get a good value for all of the disparate assets I had.

        That pretty much cover it?
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        We do not have to become heroes overnight. Just a step at a time, meeting each thing that comes up ... discovering we have the strength to stare it down. - Eleanor Roosevelt

        Your opinion of yourself becomes your reality. If you have all these doubts, then no one will believe in you and everything will go wrong. If you think the opposite, the opposite will happen. It’s that simple.-Curtis Jackson- 50 Cent
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  • Profile picture of the author DaniMc
    MRome - Thank you for sharing your experience and mentioning the products.

    This is a really interesting subject. An angle I hadn't considered, and all sorts of things are lighting up in my mind.

    What types of products/services have you seen benefit from these agreements? I know almost any could benefit, but I'm hoping you will shed a little light on your experience.

    Also - these companies you have a stake in - do you profit directly personally from the licensing agreement or does the profit just go back into the company?

    I'm interested because I wander around in that area a little bit too.
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