Art Licensing Insights and Basics
Topics and Collections
My designs are available globally on a variety of products and consistently top sellers. Here, I discuss aspects that impacted my ability to create a flourishing art licensing business.
Licensing seems overwhelming!
How much do you charge? How do you get buyers?
It takes time, patience, and learning. I became interested in pattern design in high school, which led to textile design in college. After college, I worked for 10 years as a designer in home decor, stationery, and fashion, and eventually started my own business in art licensing. This was my path, but there are different ways that artists come into surface pattern design and art licensing.
HOW
Before becoming an independent designer, I thought about the idea of licensing my artwork and having my own business, but I honestly didn’t know how. Soon after the POD (print on demand) market was born in 2010, I saw colleagues using Spoonflower and Society6, and I was able to create a vision for my future business.
MARKETING + EXPOSURE
Connect and stay in touch with your audience. Follow a mix of inspirational artists, customers, companies, or organizations that have meaning to your art brand. All of these connections have the potential to lead to licensing! Gaining visibility to engage with prospective clients and build licensing partnerships is vital. Here is how art licensing leads can happen:
EMAIL Start small with an email newsletter, monthly or quarterly.
BLOG Tell your story! Speak to your customers, clients, and partners. Write about what matters to you.
SOCIAL MEDIA It’s a no-brainer to create a presence on social media where people already spend lots of time. Connect and stay in touch with your audience. Follow inspirational artists, customers, or companies. Follow artists, hashtags, brands, and other sources of inspiration.
COMMUNITY Go to: Trade shows, networking events, and join artist groups
WEBSITE Connect your site to all your channels and create a space that truly communicates your brand.
ART AGENTS can be great to partner with a well-matched agent; you might get more licensing deals, so paying the varying commission can make sense.
POD can add visibility and exposure that fosters additional leads and gets your name out there.
PRICING
There’s no empirical answer to this question, so instead, I’ll provide context from other companies that I’ve worked with that bought artwork, and practices that help with pricing. With practice, confidence in your ability to propose fair competitive pricing will come.
POD
5-15% royalty on retail price is common. Most POD platforms offer an average 10% royalty on retail price. It can also be a fixed amount, such as per unit sale, and royalties can be subject to cost deductions, including promotions and discounts that should have a cap.
Buyout
Many companies prefer buyouts to use art how they please for as long as they want. Here are figures for purchased artwork by companies that I worked with, from 2005 to 2015, for art bought through agencies specializing in either fashion, home decor, or illustration. This pricing is for artwork with copyrights that convey on purchase, which means that the ownership rights transfer with purchase to the buyer also known as a buyout.
One important factor with respect to a buyout is that the company will want to know that the art they are buying is authentically original, which is why they would often buy from a reputable agent who has vetted their artists to know that the artists are credible when it comes to original artwork. If it turns out that the art is infringed, the company, especially a big retailer, will end up being responsible for paying damages, and no one wants that.
The average range for files that were high-res, color-separated, or vector art:
$400-$600 for fashion prints
$800-$1200 for rug art
$500-$800 for wallpaper art
Stationery - small-scale dimensions, illustration, typography, and less pattern. Maybe more vector art, but there is still a good amount of watercolor, too.
Fashion prints a variety of scales from small to large. Trend-forward content, sister prints, and collections.
Home decor -large-scale, woven construction, texture often fundamental to print for rugs, and wallpaper
Licensing
I market my art, which allows me to gauge what is popular, and inquiries are for published designs that are marketed, so companies have historically pitched to me. I retain ownership of the art, “renting” rather than selling. When renting, there are 3 common ways: non-exclusive, exclusive (category-specific), and custom commission, with proprietary levels varying and pricing that reflects that.
Term
The term of the license is based on the typical life cycle of the product; a year is common, but it could vary, and many licensing partners opt to renew. For renewals, pricing based on production is fair, but another way is renewal increases that are staggered or stepped for each renewal cycle, with full disclosure in your contract.
National retailers
Retailers that sell thousands of products to hundreds of stores typically offer low single-digit royalties, and they should offer an advance (a non-refundable deposit that is applied to future royalties and meant as good faith). The advance is deducted from sales and royalties due. Carefully review the terms, especially if the offer is royalty on wholesale, NOT retail, which is a major difference, and confirm a cap on cost deductions. It’s not fun to look at the fine print, but it's less fun to find out later that you didn’t get a good deal after all.
Good Questions to Ask
The best tools in terms of pricing are asking the right questions to decide if it’s a good partnership or opportunity for you. One of the best parts of being a licensing artist is being able to choose your business partners. Here are questions that identify opportunities and information to help with pricing.
What is the budget?
Which designs are of interest?
How will they use the design?
What is the retail price?
How much product or yardage will be made?
How long do they want to use the design?
Do they want exclusivity?
Additional Pricing and Licensing Resources
Negotiations
When it comes to art licensing, my gut feeling is that a lot of artists don’t negotiate. If this is true, this is a lost opportunity. In any other business, negotiations are expected, and why should the art business be different?
With one particular license, I counter-offered 4X the initial amount offered, and the company accepted! The truth is, I didn’t arbitrarily come up with that number. I based it on the quantity of products and what seemed fair.
Contracts
You absolutely need to have a contract to license art. Even if you start with something basic. Have a lawyer draft a contract. Here is a sample to see what is included in a basic licensing contract.
Graphic Artists Guild Handbook is an incredible resource that has sample contracts for a variety of purposes. The book elaborates better than I can on pricing based on industry standards that are based on real data.
That covers the essential aspects of art licensing. If you have questions, feel free to reach out and ask.
©Crystal Walen