Licensing Industry Shrinks in 2008
08-21-09
The Licensing Merchandising Association (LIMA) conducted their annual International Licensing Survey and announced from Las Vegas June 3, 2009 that Brand owners received $5.7 billion in licensing royalty revenue in 2008, a reduction of 5.6 percent less than collected the previous year,
This decline was in eight of nine categories of licenses tracked. The one exception – royalties collected by schools and affiliated organizations jumped 3.5 percent to $208 million.
Of course this could be connected to the economic recession but will this trend continue? I believe a good solid brand or young upcoming viable project like District 9 or some yet to be launched brand that the public will get behind should have no problem generating income. The key will be diversification into as many markets as possible without thining the subject material so that the consumer is not strained or perceives the brand owners are just milking the franchise/core business. I’ve explained this before in a previous post, that you don’t want to allow your brand or characters from your brand onto products that don’t fit in with the kind of brand you have created or put them onto poor quality products. This will reflect badly.
In 2008, the largest sement of licensing royalty revenues were generated from the Character sector within the entire entertainment industry, accounting for 46 %, while major segments like Corporate Trademarks & Brands held onto 17 %, Fashion at 14 % and Sports only came in at 1 percent of the entire industry.
The Survey seems to indicate that retail distribution for licensed merchandise may be changing. Brand owners are exploring retail opportunities beyond regular channels. Mass merchandisers still remain important but some brand owners report they are seeking relationships with smaller, independent retailers, viewed as better able to quickly respond to market trends, changes and seem willing to take new, untested properties and products.
So how do you get your brand and associated products into these markets earning multiple royalty streams? Keep returning to read future posts and you will find out.
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