Retailers play it safe, want proven successes
It’s no secret that licensing is a major moneymaker for Hollywood. Last year alone, the biz minted $191 billion from merchandise tied to its tentpoles and TV shows.
But these days, with consumers keeping a tighter grip on their wallets during the recession, retailers are playing it safe when stocking their shelves.
So how do franchise-loving studios and their licensing partners keep up with the times?
The answer, seen in abundance at the recent Licensing Intl. Expo in Las Vegas is to keep well-known properties rolling on and in the public eye.
“What is new is what is old,” says Karen McTier, exec VP of domestic licensing and worldwide marketing for Warner Bros. Consumer Products, whose “Harry Potter,” DC and Looney Tunes characters have long been workhorses for the studio. “What retailers want is proven successes. In this environment they can’t take any chances.”
The licensing show has typically been a bellwether of what products — from toys and apparel to more pricey fare like jewelry and furniture — will appear in stores, as well as boost the bottom lines of studios over the next several years.
High-profile pics being pushed at this year’s Licensing Show were Sony’s fourth “Spider-Man” and “Smurfs,” WB’s “Jonah Hex,” U’s toon “Despicable Me,” Fox’s “Alvin and the Chipmunks: The Squeakquel” and “Chronicles of Narnia: The Voyage of the Dawn Treader,” DreamWorks Animation’s “How to Train Your Dragon,” and Disney’s “Toy Story 3,” “Tron” and “Prince of Persia: The Sands of Time.”
CBS Consumer Products, meanwhile, tubthumped for CBS Films’ upcoming slate of pics, and James Cameron‘s “Avatar” was also on hand but got a bigger push at the E3 vidgame confab the same week in L.A.
Disney continues to dominate the licensing arena, earning $30 billion last year alone. Its Disney Channel sold $3.6 billion in merchandise, besting the film side of the company because of shows like “Hannah Montana,” “High School Musical,” “Mickey Mouse Clubhouse” and “Handy Manny.”
But the Disney-Pixar toon “Cars” continues to surprise, earning $2.5 billion in licensing in 2008, two years after the pic’s debut.
“It defied all normal merchandise programs,” says Gary Foster, spokesperson for Disney Consumer Products. “It grew well past the theatrical release.”
A recognizable property isn’t enough to lock down a lucrative licensing deal. Retailers increasingly want to make sure that studios will continue generating for a franchise with new movies, shows or events.
The Mouse House is keeping boys’ interest in “Cars” alive with a series of shorts, an online world, a sequel, and by overhauling its California Adventure theme park with an entire section devoted to the pic.
The Mouse House got buyers interested in its Disney Princess line with plans to release three new films — “The Princess and the Frog,” “Rapunzel” and “The Bear and the Bow” — over the next three years.
Product line was introduced in 2000, but Disney had little to support it until now. “Frog’s” Tiana is the first new princess for the company in 12 years. “Bow” will also introduce a new Scottish princess.
The company’s Disney Fairies line is also getting a push with a new direct-to-DVD movie introduced every fall over the next five years, starting with last year’s “Tinker Bell.”
Warner Bros. has similarly been keeping its DC characters like Batman, Superman, Wonder Woman and the rest of the Justice League alive through animated direct-to-DVD movies or TV shows.
“Retailers want to know there will be a continual push,” McTier says. “They’re looking for significant events that will reach millions of people.”
Despite a slump in recent sales, the licensing biz is showing signs of growth in some areas.
While videogames keep driving up revenue, studios are brokering more deals with theme parks and event producers, as well.
Warner Bros.’ “Harry Potter: The Exhibit” has been traveling across the country since April, while Universal Studios Orlando will debut a “Harry Potter”-themed world next year. It’s also been working closely with iWorks to produce 3-D films for attractions and theaters.
After Disney proved that producing higher-end items like limited edition designer clothing, wedding gowns, jewelry and furniture can move merchandise at a premium price (a Dolce & Gabbana Mickey Mouse T-shirt has retailed for as much as $14,000), Warner Bros. is also getting in on the act.
The studio recently paired up with clothing designers Diane von Furstenberg, Jimmy Choo, Manolo Blahnik, Oscar de la Renta and Betsey Johnson to re-imagine a modern vision of the sparkling Ruby Slippers from “The Wizard of Oz” for a collection that’s making the rounds around the world, timed to the 70th anni of the film. Jewelry designer Tarina Tarantino has also created a “My Pretty” collection around the pic.
Warner Bros. also partnered with Von Furstenberg to design a high-end line of clothing featuring “Wonder Woman,” while Marc Ecko is creating a limited line featuring Batman and his villains.
The products not only help position brands with more trendy consumers but make the franchises more desirable with the masses.
“It’s a really important part of the positioning and marketing of the brand,” McTier says.