A television show can earn once per episode. A licensed franchise, on the other hand, earns every time someone sells something with its name on it.

The latter makes up a lot of revenue for TV shows, with Licensing International’s latest study suggesting that global retail sales of licensed merchandise are around $389.8 billion.

It’s an industry growing quicker than traditional retail as well. In 2025, licensed merchandise sales increased by 5.45% whereas the general retail sector grew by 4.52%.

Mechanics of a Licence Deal

The rights holder, usually a studio or network, grants a licensee the right to use a franchise’s name, characters, and artwork in a defined product category, territory, and term.

The licensee will pay royalties on sales or a lump sum of money, and carry the full cost of making, marketing, and selling the product. All the licensor does is approve the designs before they’re distributed and sold.

As a result, for the licensor, most of the risk sits with the licensee, making them attractive deals, especially for TV shows that can sell their likeness.

Territory Deals

Territory deals sell a franchise into a country. The rights holder licenses a local broadcaster or streamer to show the series, and makes a localised version with partners in that country so the product is domestic rather than imported.

For example, AMC’s The Walking Dead: Daryl Dixon kept its American leads, like Norman Reedus and Melissa McBride, but in its third season they’re in Spain, filming across Galicia, Aragón, Catalonia and Valencia with Spanish cast members including Eduardo Noriega and Óscar Jaenada.

Venue Deals

Then there’s location-based entertainment. Netflix House opened its first two sites in late 2025, at King of Prussia Mall near Philadelphia and Galleria Dallas, each well over 100,000 square feet.

Inside the Netflix Houses are ticketed experiences built around popular shows, like Squid Game and Stranger Things. They’re able to offer such experiences by licensing the name from the TV show creators.

Category Deals

Category deals are when a licensor sells their name to a specialist product category. Toys, for example, go to a toy company. Clothing, on the other hand, goes to an apparel group.

It even stretches as far as slot casino games licensed for UK players. The Walking Dead has done this with games like The Walking Dead 2, The Walking Dead Cash Collect, and The Walking Dead Scratch (a scratch card game).

Licensors sell their names to these types of companies as the licensee already has the infrastructure, processes, expertise, and specialisation to succeed in this area. For the licensor, it’s just an extra way to generate revenue from their name.

One Show, Three Deals

A single show, if popular enough, can own licensing revenue from all of the three deals above: territory, venue, and category.

By doing so, they’re able to diversify their revenue streams, far beyond the revenue a TV show can bring once the hype has died down.