Licensing is not only the act of granting or leasing rights to a piece of legally protected intellectual property, e.g., an invention, design, image, or trademark.

It also signifies the imprinting of a brand, character, logo, signature, design, personality, or highly recognizable entertainment property on a product for the purpose of heightening its awareness or sales.

Over the past 30 years, brand licensing has exploded. I recall attending the first licensing show in 1980. It was held in a couple rooms at the New York Hilton. In 2010, this show, now called the Licensing International Expo, was held at the Mandalay Bay Convention Center in Las Vegas, Nevada, where consumer product manufacturers, retailers, brand and property owners, licensing agents, business development executives, marketing executives, and promotional strategists from more than 80 countries attended. It has grown into the largest show for licensing in the world. More than 500 exhibitors touted 7,000 brands and properties in a wide range of categories. For the most current show dates, check out www.licensingexpo.com.

The total worldwide retail sales of licensed merchandise surpass $190 billion, according to a report compiled by the editors of License! Global magazine.

In the current risk-averse business environment, companies are staying close to home and opting to sell products under recognizable licenses, or extend their own well-known house brands internally and through outlicensing. “Licensing is the god now,” says inventor Jim McCafferty, president of JMP Creative. “We have to figure out how to make the gods happy.”

To survive in an atmosphere of economic despondency and a fragmented retail marketplace, think about inventing specifically for a brand and be prepared to take a smaller piece of the pie.

If your new product or enhancement of an existing product is wed to an existing licensed brand, a licensee will reduce your royalty because there is a maximum royalty load any product can support. If a 5 percent royalty is being paid on an item or a line, for example, and you bring in a new product or an enhancement to an existing product, the company will probably ask you to take less to accommodate your royalty. In many cases, such eventualities are already covered by a license agreement. If a company is already paying an intellectual property (ip) owner 5 percent, it is very doubtful that another 5 percent would ever be added for you. But take heart: 1 percent can be a lot of money on certain products.

If a product is paying no inventor royalty but is well known, a company may give you less than a standard royalty. For example, in the toy business, a standard inventor royalty is 5 percent of net wholesale, but not on an existing brand unless what you bring to the party is guaranteed to boost sales. If you bring in a promotable feature that Hasbro wants for Transformers, it might offer 2 percent. But it might give Lucas 25 percent or more for the Star Wars license. Everything is negotiable.

You can make a good living inventing for existing brands, but it will take a different approach to the business. You will need to study the marketplace and see if any of your ideas can be applied in whole or part to an already successful brand.

One way to approach this opportunity is for you, as the product inventor, to go directly to the brand and make a deal to tie the brand into your concept. Then take the package to a potential licensee.

In 1998, I tracked down and telephoned Men Are from Mars, Women Are from Venus author John Gray and struck a deal for us to create a board game and license it. I saw this as a sleeping giant of an opportunity. No game publisher had yet approached Dr. Gray. Had a publisher first gone to him, there would have been no room for an inventor royalty. The game company would have done the game in-house or on a work-for-hire basis with a freelance talent. But I pitched the idea prepackaged to Hasbro and Mattel, and Mattel made us an offer we could not refuse. The game sold more than 1 million units.

I put together similar win-win-win deals creating products such as Duncan yo-yo key chains and board games based on Uncle Milton’s Ant Farm, Martin Luther King Jr., Jeopardy! winner Ken Jennings, and Magnetic Poetry, to name a few.

Prolific Chicago inventor Jeff Breslow once saw an opportunity to compete with Monopoly, published by Parker Brothers. He went to real estate tycoon Donald Trump and secured his interest in a Trump real estate game. Jeff licensed the game to Parker’s rival, Milton Bradley. He also did a Planet Hollywood game, among others, using this business model.

A couple years ago, working with a team of associates, we developed and patented a front-loading, battery-operated extruder for cake frosting. We positioned it as an alternative to the popular pastry decorating bag. Rather than attempt to license it as a stand-alone product, we approached Hasbro, manufacturer of the Easy Bake Oven, and pitched it as a brand extension. Hasbro licensed the concept and named it the Easy Bake Decorating Sensation Frosting Pen.

In 2010, a version of this concept for moms and professional bakers was introduced by Kuhn Rikon, a Swiss company known for high-quality kitchen tools.

On its website, HP indicates it is actively looking for partners with products that can benefit from its brand. The notice reads, in part: “HP’s Brand Licensing Program invites companies with innovative and exciting solutions to share in the power, prestige, and pull of the HP brand. We are looking for unique, customized, and specialty opportunities to enhance the HP customer experience.”

Over at IBM, there is also an interest in such opportunities. On its website, a notice reads, in part: “IBM has an active brand licensing program. IBM is willing to consider licensing an IBM trademark for use with suitable complementary products in exchange for appropriate compensation.”

Some companies use outside agencies to sort through and manage licensing opportunities. The Beanstalk Group, as one example, represents a wide range of marks such as L.L. Bean, Proctor & Gamble, Purina, Samsonite, Volvo, The Stanley Works, the U.S. Army, and Harley-Davidson, Inc., to name a few.

So as you come up with ideas, pay attention to which existing brands your ideas may compliment, and go after the intellectual property owners. If the brand owner does not want to license your idea itself, the company may put you in touch with a licensee that would consider your product.

Licensing is here to stay. Embrace it. Give yourself an added edge.