Today, Caterpillar has agreements with key licensees who work with their distributor partners and retail partners throughout the world. But even in the company’s early years, it put the Cat and Caterpillar name on various specialty items to support marketing efforts, special events and promotions. In the 1960s, it supported internal customers with promotional products and began its scale model program.
Into the mid-1980s and early 1990s, Caterpillar established a formal licensing team to focus on working with third-party licensees to enhance the company’s image through consumer-oriented branded products. The goals were to increase brand awareness as well as to provide Caterpillar and Cat dealers with merchandise to support marketing efforts and special events. In addition, the company entered the footwear and workwear consumer categories.
During the mid-1990s, Caterpillar entered into a licensing relationship with Wolverine World Wide to develop industrial footwear and a casual line to include footwear for women and children.
To date, more than 120 million pairs of Cat footwear have been sold globally. Additionally, Caterpillar entered into the lifestyle apparel and additional consumer categories, launching products such as bags, watches, gloves and eyewear.
The company also entered the children’s market through a program that develops smart, creative children’s products that reflect the power and purpose of Cat equipment. The strategy started with core vehicle-based toys then developed into categories such as books, role-playing games and bikes.
Sponsorship of race vehicles and sporting teams was another focus. For more than 20 years, Caterpillar has been sponsoring such events worldwide with new opportunities for licensing emerging from these sponsorships.
All of this work has helped to build on Caterpillar’s reputation as a genuine work brand with an authentic heritage. Its licensed merchandise is a direct reflection of the global values built into every Cat product, including quality, durability and value.
“The consumer may or may not own or operate Cat equipment, but they can now associate themselves with the powerful brand through a new product category,” Beaupre says. “The brand is enduring. Retailers and consumers can count on it being there, meeting expectations over the long haul.”
A New Age
More recently, Caterpillar began its freestanding retail store footprint, launching the pilot in 2009. There are now more than 100 Cat retail stores around the world. In 2011, the company expanded into the mobile phone and accessories category and other industrial categories such as auto accessories and lights.
Growth in the footwear, phones, apparel, bags, toys and industrial products like battery chargers and jump starters were key drivers for retail sales in 2014. In all, 29 freestanding Cat lifestyle retail stores opened worldwide in 2014, and the company’s lifestyle collection continues to attract new consumers.
“A corporate licensor must be true to their brand wherever they are operating in the world,” Beaupre says. “As a brand grows and extends its life in the marketplace, the natural growth into new categories is closely explored and then, when appropriate, becomes an extension beyond the core work products.”
The company has an internal process to determine whether a new category is a good fit for Caterpillar. The focus is on staying in alignment with the core Cat identity and looking for products where the company can transfer the same basic values of its brand to those products.
Among the priorities for Caterpillar’s licensing efforts in the coming years are increasing trademark protection, working with current licensees and their distributors for increased distribution worldwide, and working with licensees to create products that reflect Cat and Caterpillar globally and are mindful and modified to reflect a region’s culture.
In the retail arena, the expansion into freestanding retail stores drives the Cat lifestyle look and feel directly to its expanding consumer base and introduces the brand to a broader audience. In addition, it attracts and educates current and new consumers.
In 2015, Caterpillar will launch additional Cat retail lifestyle stores in Central and South America and China and expand distribution of Cat phones and mobile accessories including the Cat S50 rugged smartphone. Additionally, expect the Cat brand to grow in mobile apps, videos, games, tool storage and safety workwear.
“We will continue working with current licensee partners to develop exciting new styles and products that reflect Cat brand attributes,” Beaupre says.
The company will carefully select new licensees and enter into categories. Everything must be consistent with the Cat brand promise, Beaupre notes. Partners must be leaders in their respective categories. Proposed products must make a connection with the Caterpillar brand, and partnerships must not expose the company to unnecessary risk.
“We will continue our close collaboration with licensees to protect the brand and preserve the brand value through the licensing agreement and product approval process,” Beaupre says. “It is important that we understand regional culture and laws as they relate to merchandise and stores. We will also identify new categories and find the right partners while ensuring products align to the brand promise, making it easy for the consumer to understand the extension.”