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Leading executives in the licensing and merchandising space discuss encouraging toy sales, the return of location-based experiences and the rise of the metaverse.

As attendees descended upon London for the 2022 edition of Brand Licensing Europe (BLE), they do so amid an L&M market whose health is far better than the dual hurdles of a global pandemic and inflation would seem to allow.

“The L&M business is in a good place,” says Anna Knight, senior VP of licensing at Informa Markets, the organizer of BLE. “Licensing International’s global survey showed it is now valued at over £300 billion ($350 billion) for the very first time—and that’s following Covid-19 and hard times at retail.”

In the U.S., the toy industry has been proving its resilience despite an economic climate that seems poised to shake consumer confidence and spending patterns, with a 2 percent increase in sales to $11.4 billion for the first half of the year, according to The NPD Group. The encouraging spending growth in 2022 comes on the heels of record-breaking sales in 2021 and 2020, when U.S. toy industry sales were up by 20 percent and 18 percent, respectively.

“While the toy industry has pulled back to growth of 2 percent, this is remarkable as only 6 of the 14 industries that NPD tracks posted growth at all in the first half of 2022 following two years of extraordinary consumer spending,” said Juli Lennett, VP and industry advisor for NPD’s U.S. toy practice. “This speaks to the resiliency of the U.S. toy industry during these uncertain economic times.”

For ADK Emotions NY, Beyblade Burst has been a top-performing IP in the L&M business since it launched in the U.S. in 2016—and its toy sales have been consistently good. “Toys have always been our top-selling category,” says Alexis Wilcock, licensing manager at ADK. “Overall, we’ve launched over 80 SKUs for the brand and are continuing to expand our list of licensing partners worldwide.”

SHELF SPACE
Beyblade Burst, as an interactive toy brand, still benefits mightily from being a presence on the physical shelves of brick-and-mortar retailers. “The opportunity to be in-store with product has always been top of mind,” says Wilcock. “There is nothing quite like a kid pulling on their parent’s arm in the toy aisle, asking to expand their growing collection of Beys and showing up in person to battle in a tournament with their friends.”

Wilcock also notes the parallel need to have an e-commerce presence, mainly as Covid-19 accelerated shifts in buying patterns worldwide, as well as the value of having robust online spaces for fans to interact with each other and the Beyblade brand. “Our social media channels have become hubs for fans to geek out about their favorite Beys and replicate the same kind of word-of-mouth buzz we used to only see on the playground. We are focusing on executing more physical events now that the current climate has allowed us to, in addition to maintaining and expanding our digital presence so that fans can have multiple touch points with the brand,” adds Wilcock.

Jennifer Coleman, VP of licensing and marketing at Konami Cross Media NY, says that the L&M business for anime brands is “going gang-busters” and lists the company’s two strongest categories at the moment as collectibles and apparel. “We will continue to focus on those categories while we look for other avenues of growth in our category mix,” says Coleman, who notes Konami’s commitment to growing its overall social media marketing strategy across its brands.

“We will look for new ways to engage in an authentic way with fans to keep them abreast of the latest products, events and happenings for our IPs,” she explains.

Not only is Konami expanding its e-commerce presence in its efforts to offer more inventory, styles and products to fans of its brands, but it’s also rolling out pop-up shops and other avenues for in-person buying. E-commerce “is crucial for the merchandising success of all of our IPs,” says Coleman. “Limited pop-up shops and fan conventions are retail options that have been very successful for us in the recent past, and we will continue to explore opportunities for sales growth there.”

For Konami’s Yu-Gi-Oh! business, brick-and-mortar remains key. “That is where the trading card game is sold and where our fans and players can interact and play with each other at Official Tournament Stores,” explains Coleman, noting the sense of community this fosters for its fans.

Mediatoon Licensing, which specializes in European comics and Japanese anime, manages the licensing and merchandising rights of the Narutofranchise for Europe, Hunter x Hunterfor EMEA, Lucky Luke for the world and an assortment of other Média-Participations Group brands. Jerome Leclercq, CEO of Mediatoon Licensing, also sees the benefits of dividing brand-building resources between in-store and event retailing and online sales.

“Although e-commerce is growing, the majority of our merchandise sales are still in shops,” says Leclercq, noting IP-specific plans for pop-up stores in China and Europe. “Moreover, we’re managing two e-shops: one entirely dedicated to consumer products from French and Belgian comics in limited series and the other dedicated to both comics and merchandising.”

Leclercq adds, “We are fortunate to be part of a large publishing and entertainment group, which allows us to work in 360 degrees and activate all the leverages that brands need since our group includes a video game publisher, a streaming platform and a theme park. This year, we have a lot of events around the 20th anniversary of Naruto, notably a musical show that will tour in ten cities in France—and I hope in the rest of Europe next year.”

In terms of digital extensions, Mediatoon is trying to further grow its brands through its streaming and webtoon platforms, as well as via NFT projects, e-shops and its video game sister company, Microids. In the coming years, Leclercq believes that “metaverses and webtoons will bring out new brands very quickly.”

As David Kleeman, senior VP of global trends at research and strategy consultancy and digital studio Dubit, sees it, we are still in the very early stages of metaverses—so early that it almost eludes a clear definition. “You may have heard the expression that the future is here; it’s just not equally distributed,” says Kleeman. “Well, the metaverse is here, but it’s in pieces, and we need to put it together. The great thing about that is that we can envision the metaverse we want, not just take the one handed by the big companies or anyone like that. We can build a metaverse that is great for kids, building on the brand equity we as television executives have built over the years.”

DIGITAL WORLDS
“It lowers frustration barriers to people doing the things they want to do,” adds Kleeman. “You can be a gamer—you can play a game or make a game. You can tell stories. You can be part of somebody else’s stories. You can learn. You can teach. We mostly find people are using it right now for socializing, communicating and gameplay, and they’re becoming creators. Shopping is emerging in it. It’s more about brand awareness and affinity than about actual shopping.”

ADK’s Wilcock also sees the future potential of metaverses, particularly regarding the social aspect. “As we enter the age of the metaverse, the merchandise we bring into our digital lives becomes increasingly important,” she says. “Just as physical products allow fans of an IP to bond and connect in person—e.g.: ‘Hey, I love your Beyblade shirt! Where’d you get that?’—digital collectibles will take on the same social clout.”

The company’s digital extensions include the mobile app games Beyblade Burstand Beyblade Burst Rivals, which have both seen significant engagement around the world. “We think about these apps as creating another space for fans to battle with one another, and they’ve allowed us to expand our reach to all corners of the globe,” says Wilcock.

Wilcock notes that despite the expansion in the digital dimension for brands, slowly emerging out of the worst of a global pandemic has meant that people are more eager than ever to connect in person once again. “Location-based experiences can feel like a balm to the years of isolation we’ve all experienced,” says Wilcock. “There’s nothing like a Beyblade fan being able to find and battle with other Beyblade fans at a con or tournament. Brands have an opportunity to create spaces for connection and to attract new potential fans who don’t want to miss out on the fun via in-person and physical events. We are focusing on executing more physical events now that the current climate has allowed us to, in addition to maintaining and expanding our digital presence so that fans can have multiple touch points with the brand.”

Alma’s Way, a preschool series made by Fred Rogers Productions for PBS KIDS and sold by Sinking Ship Entertainment, held an event to celebrate the launch of its new digital game, The Alma Train, at New York City’s Grand Central Station last month. The Alma Train Party at Grand Central Station featured activities and stations from renowned institutes from the Bronx, Alma’s hometown, including The Bronx Children’s Museum, The Bronx Zoo and The Bronx River Alliance, and the New York Public Library.

The interactive event enabled the brand’s young fans to take photos with the Alma costume character, play the new The Alma Traindigital game, meet real female MTA subway conductors, learn traditional Puerto Rican Bomba dancing and more.

In the global content industry, there remains an ongoing debate about the value and demand of known IP versus original ideas—and the same goes for the licensing and merchandising industry. A new property that aims to break through in the L&M space is Zoonicorn, for which Toonz Media Group has signed licensing agreements with E Graphic Design and SRM Entertainment. E Graphic Design will produce custom-designed wallpaper, wall decals, acrylic frames and PVC for the preschool brand that will be available on the company’s website this fall. A division of Jupiter Wellness, SRM Entertainment will use Zoonicorn with its proprietary Sip With Me children’s cup line of products and dinnerware that is slated to launch at retailers next spring.

The CGI series, which follows zebra and unicorn hybrids that enter the dreams of young animals to take them on adventures to learn social-emotional skills, has premiered on NBCUniversal’s Peacock in the U.S. and is debuting around the world on additional platforms such as Kidoodle.TV (U.S.), Astro (Malaysia), Truecorp (Thailand), La Teletuya (Venezuela) and Viu (Hong Kong).

Among the properties in Mondo TV’s portfolio with significant brand potential are MeteoHeroesand Grisù. The former, which follows six super-powered kids on environmentally minded adventures, already has inspired its own video game in MeteoHeroes—Saving Planet Earth!A co-production between Sony Interactive Entertainment España (SIE España), development partner Gammera Nest and Mondo TV Studios, it invites children of all ages to help save the Earth in an action platform game that sees players find hidden items on the screen as they try to protect the world from pollution and decay.

Grisù, set to debut in the fall of 2023, centers on a young dragon aspiring to become a firefighter. It’s a property for which Mondo sees great potential in the L&M space. In Italy, the licensing program already has partners in the publishing category that will deliver books, activity books, coloring books and sticker albums to the market.

CHASING BUZZ
Konami’s Coleman believes categories can set a property apart, whether a known IP or a newcomer. “In my experience, I don’t believe that [the market] is skewed to known brands as much as I think it is skewed to categories,” she says. “What category your IP falls into is critical for success when under consideration by a licensee or a retailer. There needs to be buzz for the brand happening on social media to help an IP cut through and [find] the right demographic appeal. Everyone is about Gen Z now and how to be seen by that demo.”

The ability of a new IP to cut through in the kids’ space comes down to the quality of its storylines, visuals, play patterns, world-building and fandom, according to ADK’s Wilcock. “To push past the point of just watching a show to wanting to buy merchandise for it, you need to have a specific hook,” she says. “Brands that are inherently collectible also have a huge advantage because they create a reason for buyers to keep coming back.”

She adds, “In our case, kids want to replicate what they’re seeing in the content they’re consuming—whether that be battling as they see in Beyblade Burst QuadDrive, connecting to the characters in the show by wearing them on their apparel or back-to-school gear or building their collections of Beys, stadiums and launchers.”

Leclercq expresses optimism about the potential in less-established IP while noting that the path to profitability can be more challenging. “There are opportunities for niche IPs, even if the market is tilted in favor of well-known and evergreen brands,” he says. “To launch a new IP, you need qualitative content, time, maximum visibility on networks, media in several territories at the same time, a lot of work and luck.”

There will be challenges ahead in the L&M market, notably disruption to the supply chain, increasing energy costs and sustainability, according to Informa Market’s Knight, but there’s every reason to believe the industry will find a way to solve for them. “We have already seen the industry step up and make a difference when it comes to sustainability and have witnessed innovation—particularly within the apparel and toy sectors—in relation to product design and manufacturing.”






About Chelsea Regan

Chelsea Regan is the managing editor of World Screen. She can be reached at cregan@worldscreen.com.

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