Industry
Part of Celebrity brands: who carries the loss under each deal type
5 things to weigh up on celebrity brands portfolio
Five checks on a celebrity brands portfolio: who owns each trademark class, what the license permits, and what a buyer inherits at renewal.
A trademark register entry for a well-known name rarely shows one owner. The mark sits in several classes of goods, often held by different entities, with different filing dates and statuses.
That spread is the celebrity brands portfolio. Not a list of ventures the person is "behind", but a record of who may use the name, for what, and where.
This page treats the portfolio as a licensing map. It differs from the holding structures on the celebrity companies portfolio page, which cover what a person owns. This is about what a name has been rented for.
The holder is not always the celebrity. Authentic Brands Group owns more than 50 consumer brands, as well as the likeness rights or estates of celebrities, including Muhammad Ali, Elvis Presley and Marilyn Monroe. A portfolio of that kind is a licensing business first: the filings and the contracts carry the value, not any single product.
What to take away
- A portfolio built on one name is a set of separate contracts with separate counterparties, and they do not automatically know about each other.
- Each license is chosen partly for what it makes the next one possible.
- The weakest licensee sets public perception of the whole name, because shoppers never see the contract boundaries.
- Royalty rates, minimum guarantees and terms sit in the contracts, not in the register.
- Renewal dates, not launch announcements, tell you whether the map still holds.
The five things to weigh up
1. Owner of record by class. Every class is a separate registration with its own owner of record. Look up each registration in the USPTO trademark database for status and documents, and list each class, its owner, its filing date and its status.
Different owners by class usually mean separate licensees or a holding entity assigning rights category by category. A lapsed class usually means a license ended. The same check works on the registers kept by EUIPO and WIPO when the name is licensed outside the United States.
2. Exclusivity by class. Each licensee wants assurance the name will not appear on competing goods from another partner. The class definitions in the filings draw that boundary, and disputes over whether a product falls inside one licensee's class or another's are common and private. Read the goods description, not the marketing category.
3. Channel restrictions. A licensee selling into department stores does not want another licensee's product in discount outlets under the same name. Channel terms in one contract protect the position of another. Where a discount channel carries the name, expect the premium licensees to negotiate harder at renewal.
4. Approval rights and quality control. Licensed use by a related company benefits the owner only where the owner controls the nature and quality of the goods. Under the Lanham Act, the US federal trademark statute, that control is what keeps the registration valid, and a license the owner does not police can be attacked as abandonment. Exercising approval is a job, and the job scales with the number of licensees.
5. Cross-default and reputation clauses. Some agreements allow termination if the name suffers damage through a different licensee's conduct. The map is only as strong as its worst contract, and one bad partner can trigger exits elsewhere.
What each category usually looks like
| Category | Who usually holds the license | What the licensor has to police |
|---|---|---|
| Fragrance | A fragrance house with its own distribution | Discount channel leakage |
| Color cosmetics and skincare | A contract manufacturer or brand incubator | Range creep into products the name does not fit |
| Apparel | A wholesaler or a retailer's private label operation | Quality drift at low price points |
| Eyewear, footwear, accessories | Specialist category licensees | Consistency of design language across licensees |
| Spirits | A producer or a purpose-built brand company | Marketing claims made in the name's voice |
| Home goods | A retailer or a housewares manufacturer | Association with a lower price tier than the rest of the map |
Each row is a separate contract with its own term, territory, royalty base and approval process. The person, or more often a management company holding the name rights, sits at the center with unrelated counterparties who have each agreed to a different document.
Fragrance licenses in particular are usually held by beauty houses with their own distribution, such as Coty, rather than by the celebrity's own company. That is one reason the same name can sit on a prestige scent and a discount body spray at the same time.
Two portfolios on the record
Public filings show what these maps look like when a listed company is one of the counterparties.
- Kylie Jenner's beauty business and Coty.Coty's November 2019 announcement, filed with the Securities and Exchange Commission, set out a partnership in which Coty would have overall responsibility for the portfolio's development, from R&D and manufacturing to distribution, while Kylie Jenner and her team would continue to lead all creative efforts. In addition to its role in the partnership, Coty would act as a licensee for skincare, fragrances and nail products. That is checks one and four in practice: one counterparty holding several categories, with creative approval staying with the name.
- Material Girl and Macy's.Iconix Brand Group's 10-K describes MG Icon, a joint venture created by Iconix with Madonna and Guy Oseary in March 2010 to license the Material Girl brand across consumer product categories. At formation it entered a direct-to-retail exclusive license with Macy's covering a wide array of categories, so one retailer held most of the map. When that license expired under its terms in January 2020, most of the map ended on a single date. That is the opposite of the uneven endings described below, and it is the cost of concentration: one renewal decision decides the whole name.
How the order gets set
The first license is chosen for what it proves. A category with fast sell-through and visible retail presence establishes that the name moves product, which is the evidence every later negotiation rests on.
The second is chosen for adjacency. A fragrance license makes a skincare conversation easier; skincare makes color cosmetics easier. Each category borrows credibility from the last, and licensors' representatives are explicit about the sequence even when the public story is one of spontaneous inspiration.
Territory is sequenced too. A license for one region can be a test for a global one, and a licensee that performs at home is often offered the next territory rather than a new entrant getting it.
The celebrity companies by industry page explains why each sector produces the structure it does. The portfolio is what happens when those structures stack on one name in a deliberate order.
Where the map cracks
Dilution. Every added category makes the name mean less in each. A name that once signalled one thing comes to signal availability. Premium licensees feel this first.
The cheapest licensee wins. If one partner puts the name on a low-tier product in a discount channel, that is the version most people encounter, and it reprices the name for every other licensee.
Quality variance. Different manufacturers, different standards, one label. The approval process exists to prevent this and is usually under-resourced relative to the number of products it covers.
Uncoordinated endings. Licenses expire on different dates. A map that was coherent at its peak becomes a patchwork as terms lapse unevenly, leaving the name on some shelves and not others with no public explanation.
Reading a map from the register
Reading the trademark register
- Search the trademark register for the name
- Note every class it is registered in
- Record the owner of record for each class
- Check filing and use dates
- Check the status of each class
If the owner differs by class, you likely have separate licensees or a holding entity assigning rights per category. If a class has lapsed, a license probably ended.
What the register will not show is the royalty, the minimum guarantee or the term. The fashion beauty ventures page sets out what a license in this category actually contains; the register shows only its outline.
Common questions
Is a wide portfolio a sign of a strong name?
It shows many licensees were willing to pay for it at some point. Whether that still holds is answered by renewals, which are rarely announced. Treat renewal dates as the real test.
Does the person control what each licensee makes?
Within the approval rights in each contract, which are narrower than the word "control" suggests. The licensee decides what to make; the licensor can object. Read the approval clause before assuming editorial say.
Why does the same name appear on products of very different quality?
Because they come from different licensees under different contracts. The approval process did not, or could not, hold them to a common standard. The cheapest product is the one most shoppers see.
Can a licensing map be sold as a whole?
The name rights can be assigned to a new holder, who inherits the contracts. It happens, and it is one of the few ways the whole portfolio changes hands at once. The franchises and licensing page covers where licensing ends and a franchised system begins.
Related reading on this site: celebrity brands explains what a name buys a single brand and what it cannot.
