Which of the following is a benefit to the licensor in a licensing contract?

• A. Guaranteed Additional Sales
• B. Creation of a New Advertising Stream
• C. Higher Price Point
• D. Protection Against Trademark Infringement

Answer: (D)

In licensing contracts, protecting the brand is a central goal for the licensor, and one of the clearest benefits is securing protection against trademark infringement. When a brand owner licenses out its mark, the agreement typically includes rights to enforce use rules and take legal action against unauthorized or counterfeit uses. This safeguards brand integrity, preserves quality standards, and maintains the brand’s value and equity. Without that protection, others could misuse the mark in ways that dilute or damage the brand, reducing its overall worth.

While licensing can lead to revenue or new marketing opportunities, those outcomes aren’t guaranteed and are not the direct, inherent benefit being described here. Guaranteed additional sales aren’t ensured by the license itself, and a higher price point isn’t a guaranteed outcome of licensing. Creating an advertising stream can be a byproduct in some arrangements, but it isn’t the core protective advantage that a licensor seeks through a licensing contract.