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Bond in Motion is currently showing at London Film Museum


with both the IP owner who negotiates the agreement and the IP creative team who oversees and approves the development process. Simple temporary events can take up to six months, while major developments can take 2-3 years. 4. Inspire and enthuse the IP team. An incremental source of revenue is important to them, but protecting the reputation of the IP, and hence their core income streams, is going to always be their main concern. Provide reassurance that you will respect and protect the IP and have the capacity to bring it to life in a way fi lm or television cannot do. 5. Ensure negotiations for licence agreements are based on solid business planning. IP owners are rarely aware of the realities of attraction economics. Enter negotiations with a good estimate of the incremental impact of adding the IP in both revenue and cost terms to ensure you negotiate a fair agreement which allows both parties to benefi t. Look over the full term of the


agreement, as following the launch year the impact often diminishes. The term of the agreement should be suffi cient to pay-back on investment, for example, a 10-year period with options to renew. IP owners are more used to negotiating


two to three year licence agreements so again “education” is often required. 6. Be clear about your ongoing needs. Specify what support you require, such as exclusivity within a region or sector and commitment for the term.


AM 1 2015 ©Cybertrek 2015 AN IP NEEDS TO BE TRANSLATED INTO


AN ATTRACTION ENVIRONMENT IN A WAY THAT WILL SATISFY ITS FIERCEST FANS


LICENCE AGREEMENTS Licence agreements typically have two components: ■ A fi xed upfront fee, which guarantees exclusivity for the development period and funds the IP’s costs for supporting the development. ■ An annual share of the incremental revenue or profi t for the term of the agree- ment. A fi xed fee helps attractions plan and avoids complications determining what growth is specifi c to the addition of the IP. Or it’s a percentage of incremental revenue, in which case the IP owner needs a guaranteed fi xed amount, normally about 50 per cent of the expected total. Individual licencing agreements vary


considerably. To generalise, the annual cost can range from 4 to 10 per cent of incremental admissions revenue and 8 to 10 per cent of IP branded merchandise income. You’ll also incur costs relating to time spent liaising with the IP team and possibly higher investment costs relating to the addition of the IP.


IMPACT OF IP DEVELOPMENT The impact of IP development varies con- siderably but the majority of attractions I


reviewed experienced volume growth. For most, increases in admission


price related more to the scale of the development than the involvement of the IP. Hence the main driver of income growth was higher attendances, with IP-related merchandise sales a strong secondary benefi t. The greatest impact was often at mid-scale attractions adding an IP land, with examples of attendance growth of 30 to 100 per cent. On a larger scale, the Wizarding World of Harry Potter grew attendance at Universal’s Islands of Adventure by over 70 per cent in its fi rst two years. But it’s not all about money. The


emotional connection that a visitor has with an IP experience can be far greater than for other attraction experiences, a considerable benefi t for both the attraction and the IP owner. ●


Lesley Morisetti launched Morisetti Associates in 2010 to work with visitor attractions and experience providers, building on 30 years of international


operational and consultancy experience. www.morisettiassociates.com


Read Attractions Management online attractionsmanagement.com/digital 63


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