{"id":5900,"date":"2020-10-07T07:41:48","date_gmt":"2020-10-07T07:41:48","guid":{"rendered":"https:\/\/focus.cbbc.org\/?p=5900"},"modified":"2025-04-23T10:04:38","modified_gmt":"2025-04-23T10:04:38","slug":"how-to-license-your-ip-in-china","status":"publish","type":"post","link":"https:\/\/focus.cbbc.org\/how-to-license-your-ip-in-china\/","title":{"rendered":"Hasbro, Mattel and eOne Family explain how to license and protect your IP in China"},"content":{"rendered":"

Hasbro, Mattel and eOne Family brands reveal their experiences of licensing IP in China and explain how they effectively protected their IP rights to CBBC<\/a>‘s Iris Hu<\/h2>\n

On a stroll through Beijing\u2019s buzzing Tai Koo Li mall, you don’t have to look for long to spot familiar cartoon characters on the T-shirts in window displays, or well-known paintings printed on to the latest covetable tote bag. Of course these cartoon characters and artworks are IP assets, but the retail merchants don\u2019t own that IP. Rather, they have been licensed by the rights holders to manufacture and sell the products for an agreed period of time within a certain territory in a bid to boost sales figures.<\/p>\n

Essentially, IP licensing is a way for companies to increase the visibility of their brand and generate more revenue. To some extent, the licensor and licensee share the risks when they engage in IP licensing: on the one hand, the licensor does not need to risk producing and shifting merchandise that might not sell, and is simply paid royalties; on the other, the licensee does not need to worry about developing the reputation of the licensed IP and can simply use it to gain their own advantages in the market.<\/p>\n

According to the Global Brand Licensing Market Report 2020 undertaken by the International Licensing Industry Merchandiser’s Association<\/a> (LIMA), the retail sales of licensed merchandise increased 4.5% worldwide in 2019, to $2,928 billion. By type of merchandise, clothing (15.1%), toy (12.2%) and fashion accessories (11.9%) stayed ahead of the market in 2019.<\/p>\n

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In respect to the licensing statistics of China, the China Toy & Juvenile Products Association (CTJPA) underwent a survey<\/a> that indicated retail sales of licensed merchandise increased 15.6% nationwide in 2019, to reach RMB 992 billion (approx. \u00a3113.5\u00a0 billion) of sales revenue and RMB 38.2 billion (approx. \u00a34.3 billion) of royalty revenue.<\/p>\n

In this article, three world-leading licensors, Hasbro, Mattel and eOne Family Brands share their experience of licensing IP in China and, more importantly, explain how to effectively protect IP rights and deal with various challenges to help propel your business and commercial operations in China forward.<\/p>\n

Hasbro<\/h2>\n

According to Licensing Global<\/a>, Hasbro ranks seventh among the top 150 global licensors, with \u00a35.3 billion of retail sales in 2019. The portfolio of Hasbro\u2019s iconic brands includes Transformers, My Little Pony and Monopoly, and the company is a leading licensor in the entertainment industries: Hasbro\u2019s licensing operations in China cover merchandise licensing, publication licensing, co-marketing promotion and more.<\/p>\n

Jessica Qian, head of Hasbro\u2019s licensing business for China, says that Hasbro attaches great importance to its cooperation with its licensee partners, citing the case of licensing its IP to Baleno, a well-known apparel brand in the China market.<\/p>\n

When Hasbro selects a suitable licensee, the licensee\u2019s sales volume and coverage of sales areas are considered the most important factors. As a result of this criteria being applied, Baleno was one of the best contenders for winning the licence: the company is capable of achieving strong sales figures and its retail stores are located all over China, including in third and fourth tier cities.<\/p>\n

When Hasbro selects a suitable licensee, the licensee\u2019s sales volume and coverage of sales areas are considered the most important factors.<\/p><\/blockquote>\n

As a result, Baleno obtained the non-exclusive licence from Hasbro to manufacture, promote and sell clothes bearing the cartoon characters owned by Hasbro. That is, Hasbro itself may also use the same IP as well as grant such an IP licence to other licensees in China within the licence period, though Hasbro would usually not authorise a number of licensees in the same sector for the sake of avoiding competition.<\/p>\n

Under the details of the licence, Baleno can select certain images of the brand’s cartoon characters from the design books provided by Hasbro, and then has the right to manufacture the clothing bearing those selected images. Baleno is also permitted to use the relevant trademarks in promotion and advertising campaigns.<\/p>\n

It is therefore essential that Hasbro, as the licensor, has registered the trademarks underlined by the China National Intellectual Property Administration (CNIPA) and has recorded the copyright of the principal images of the cartoon characters with the Copyright Protection Centre of China (CPCC) before licensing its IP to Baleno.<\/p>\n

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The first licensing cooperation between Hasbro and Baleno was established back in 2013. Baleno was initially licensed by Hasbro to sell boys\u2019 clothing and accessories bearing images of Transformers. During the licence period, Baleno displayed Transformers-themed props in its local stores, attracting young Transformers fans and boosting sales. The success of this initial partnership led to a further licensing cooperation between Hasbro and Baleno on another brand \u2013 My Little Pony \u2013 the subsequent year.<\/p>\n

To everyone’s surprise, revenues from Baleno\u2019s My Little Pony items outperformed those of Transformers, despite the candy-coloured horses being much less popular in China at the time. Not only were the appealing images selected from the design book provided by Hasbro the key to the success of this particular licensing deal, but also Baleno\u2019s efforts in making the shopping environment more attractive to customers.<\/p>\n