Category: Blog

The reform we were waiting for seems a reality FDI in retail seems in the anvil albeit with some problems! Check here for why we believe this will be a catalyst to Licensing industry growth

http://yourstory.in/2011/10/toying-with-dreams-the-dream-theatre-story/Miles to go before we sleep…and dream again!

Wow! The large toy companies are blurring the lines between toy and content! Mattel has bought out Hit Entertainment -the much loved home for Thomas the tank engine, Bob the builder, Barney etc. This is the second toy company that has shown serious effort at forging ties with content and broadcasters. First, Hasbro tied up with Discovery channel. This move was more of creating content around Hasbro’s top shows and making them multi dollar brands. Trivial pursuits, My little pony, GI Joe will all evolve into TV and digital content and find a home on Hasbro TV.
(more about Hit Entertainment…)

Mattel of course had significant success with Hit brands like Thomas, Bob and Barney and they will now leverage the popularity of the brands and make ancillary revenues outside of pure toys. I am keen to know how broadcasters react to this partnership.  Our experience has been that every toy player (regardless of how engaging content is…) has needed to pay for placement. Some of the Japanese properties like Beyblade are an exception but whenever they know its a toy company creating content; they would demand their pound of flesh. This is now the norm.  So broadcasters will make some more change whether on placement or via disguised incremental advertising spends. So, Hasbro in a way, safeguarded these struggles with their Discovery tie-up.

In India, pre-school content has no value as all broadcasters are driven by advertising monies. Since our Indian rating systems do not capture 0-4 year old’s; the broadcasters pretty much look at this as “dead inventory” and do not invest in these magnificent shows. A pity really! But then, all motivations are purely commercial. Who really cares what consumers want right?

Good luck to Hit and Mattel. Two remarkably cool companies. We of course represent Hit on the licensing business. Will we be HIT? Right now, we will put our heads down, work and show our METTLE!

Star Wars has made more monies on licensing and merchandising than Box office! Today, more licensees are shying away from movie licensing. They say, shorter life cycles of the movie business as the prime reason. Hollywood films have created a science out of extending life cycles: Theatrical launch followed by home video, merchandising, TV syndication etc.
I don’t believe that Bollywood is far behind on mirroring Hollywood trends. However, there has been no real effort at building a licensing & merchandising program. Part of the reason is to go with a plan that has worked historically i.e Box office, home video, satellite rights and usual marketing touch points. why fix whats not broken? The second is that its not seen as a serious tool of a marketeers arsenal and so, there are no integrations at a script level keeping licensing in mind. We (in our last avatars) worked on three movies Drona, Bhoothnath and Love 2050. In the case of Drona, a key product that was launched did not feature in the final cut of the movie while we had invested in launching the product. A small slip! Drona and Bhoothnath sank like the titanic and so all the products including the Pink teddy bear was stuck with the licensees as dead stock. Bhoothnath at least did not lose money for our licensee.
However, all of these were half hearted efforts and afterthoughts.
This brings me to Ra-One! I am agnostic on how it will fare at the Box office but full marks to SRK for making a genuine effort at creating a licensing, merchandising and gaming program. Check the store. One may criticize quality of products, the movie content etc. but dont forget, Krish had an opportunity and they did not do it!
SRK has used his existing endorsement clients to push the Ra-one message. He has created, games, comics, products, Mcdonalds Happy meal giveaways. Will the movie tank and with it all the products? This is unpredictable but this is the first genuine effort at building a superhero licensing program. For this, much respect!

Most retailers we have been meeting have been speculating that it’s just a matter of time before the Indian government opens up FDI on “multiple brands” in India.The “matter of time” has taken really long but latest news is that the government is hinting on raising the ceiling on “single brands” from 51 percent to 100 percent.  This is great news! I have already expressed why this change in policy (FDI fo multiple brands) has a very favorable impact on licensing in india. The waiting continues!

Paris Hilton has licensed her likeness to Brand Concepts and there are plans to launch merchandise and stores in India. Most of us  would harbor the thought: Who is Paris Hilton? Her reputation has not been pristine, her personality is not something aspirational and she is just an average pretty lady. So, will this work?
( more about Brand Concepts… )
Before dismissing this project, lets look at the trends round the world. Celebrity based licensing generated close to 4.87 billion dollars in 2010 (The Licensing Letter). The two big learnings from Global trends- “B class “celebrities have done better at Licensing. They are more available for appearances and promotions of the brand. Sarah Jessica Parker’s fragrance has been a hit in a cluttered market and analysts speculate that its due to her finding time in promoting the line.
Second,  with “B class” celebrities, there is now sharp “ups and downs” e.g Miley Cyrus at her peak of fame launched  Max Azria at Wallmart was heralded  for its fashion but sales fell as her popularity waned. Licensing has worked best when the association is more fashion and less talent. So, Jessica Simpson’s musical carreer is on a decline but licensing is on a trot. She has launched her 22nd category with diamonds!

Then, there are the numbers – The women’s fashion accessories market in India is estimated at Rs 6,000-6,500 crore and Paris Hilton has 17 product lines, including handbags, eye-wear, watches, fragrances, apparel, footwear, music albums, pet products, stationery and bedding. This can all be housed under a retail format.
So, we will  wont be surprised if it works in India. My only caveat- we need to build a brand before we license. Has Paris Hilton done anything in India to be a brand is the question…Time and the efforts of execution will be the answer.