Intellectual Property: Why Your Marketing Agency Should Take a Closer Look
Although a significant part of my marketing law practice involves helping marketing agencies protect their interests in client contracts or in freelance relationships, or counseling them how to protect their clients, most agencies don’t realize the full financial and business potential of leveraging their own intellectual property in these transactions.
I’ll say it simply: some of your best leverage in your agency’s client relationships is the intellectual property you create for them.
This is reason enough to pay attention to protecting the IP, and making sure it is addressed properly in your client and freelancer contracts.
There’s another reason, as well. Beyond its core client practice, an agency’s intellectual property is its number one revenue growth opportunity, and something typically untapped.
Intellectual Property is an asset that can be turned into cash in the form of licensing income, royalties, additional professional fees, or an enhanced purchase price when the time comes for your agency to be sold.
It may also create ongoing passive revenue streams for your Agency to supplement its client billings.
It’s not an easy road, but certainly one worth considering. Learn the basic steps below, followed by some detailed resources for further reading.
Discovering Intellectual Property in Your Agency
Puzzled about how to begin finding IP in your Agency? Here are the areas to start:
- Original Brand Trademarks and Taglines
- Unexecuted Client or Spec Work
- Proprietary “Client-Facing” Processes or Methods
- Proprietary “Agency Internal” Processes, Methods or Training Curriculum
- Original Technology Solutions
Once you identify your intellectual capital, some of which could converted into additional revenue streams, higher professional fees, or enhanced value to a potential purchaser of the Agency, then it’s time to get serious about specifics to pursue.
Auditing Your Opportunities
The next step is a simple but effective auditing system to review, prioritize, protect and monetize. The audit process will help you determine what types of assets the agency has, and whether you need to invest resources to protect and monetize them.
- Step One: Inventory of the assets. The who, what, when, and the details behind each asset.
- Step Two: Prioritization, including the Agency’s unique position and process on weighing the risks and rewards of each opportunity.
- Step Three: Protection. The only right time, and least expensive way, to legally secure your Agency’s intellectual property is before you try to monetize it. Protecting your agency assets can include registration of trademarks, copyrights or patents, IP rights assignments, confidentiality agreements, and similar legal measures.
It’s important to note that this stage of the process can be as helpful in getting you to the conclusion that your agency does not want to pursue a particular opportunity, as it is in helping you decide to move forward. Either decision is a valid path.
With proper planning and protection, your Agency can start on the road to monetization. Potential paths and benefits include, but aren’t limited to:
- Realizing an enhanced purchase price for the Agency’s business
- Outright sales of the asset
- Direct licensing of the assets
- Licensing with a distribution model, such as “white-label” license opportunities
- Emerging IP revenue models tied to your unique capabilities, such as monetizing industry-specific content
Intellectual capital is what marketing agencies build and deliver every day for their clients. Make sure your agency is getting as much value from your IP as possible to maximize its worth, for a lifetime of value.
Want more information? Read my comprehensive series on monetizing your agency’s IP below, and contact me direct.
- Agency IP? What Agency IP? Five Places to Find Intellectual Property in Your Marketing Agency
- The Marketing Agency Roadmap for Turning IP into Money – Part 1: Review Your Assets
- The Marketing Agency Roadmap for Turning IP into Money – Part 2: Cover Your Assets
- The Marketing Agency Roadmap for Turning IP into Money – Converting Assets Into Revenue
- A Marketing Agency Business Expert’s View on the Value of IP – Tim Williams, Ignition Consulting Group
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