A licence is personal permission for someone to occupy accommodation. It does not give the licensee a legal interest in (or control of) the land. Without the licence the occupier would be a trespasser. A licence can be fixed term or periodic.
A licence is not a lease: it is a personal right or permission that offers no security. The distinguishing feature of a lease, as opposed to a licence, is that the tenant has exclusive possession of the let property.
Landlords should always be cautious when granting a licence as in certain circumstances, if a licence fulfils the characterises of a lease a tenancy will be created. Should a tenancy be created the occupant could benefit further from security of tenure under the Landlord and Tenant Act 1954. The leading case is the House of Lords' decision in Street v Mountford  AC 809 which was more recently reinforced in Clear Channel UK Ltd v Manchester City Council  EWCA 1304.
Examples of where licences can be used are between a landlord and tenant between exchange of an agreement of lease and the grant of a lease. The use of a hall for periodic fitness classes, the use of a room for lecture, co-working arrangements.