TV Kids spotlights strategies that help build successful licensing and merchandising campaigns for kids’ programming.

As shelf space becomes more and more crowded, L&M executives must arm themselves with knowledge about current trends to give their properties the best chance for success and, if they’re lucky, staying power in today’s challenging retail landscape.

Much like TV-watching habits are analyzed to track viewers’ preferences, trends related to the purchase of licensed products must also be evaluated so that retailers and L&M execs can stay in the know, make consumers happy and keep profits flowing. Recently, global information company The NPD Group unveiled its U.S. Kids License Tracker, which provides “a holistic view” of licensed purchases in the country for kids up to age 14. The new service explores how license spending and buying behavior varies across such categories as apps and in-app purchases, arts and crafts, baby gear, books, clothing, footwear, school supplies, toys/puzzles, accessories and more. Insights include purchase methods and occasions, pricing, items bought, and demographic profiles of both the buyers and children.

“NPD’s new service will provide our clients with a complete view of the kids’ licensing market and key insights to help retailers and licensors identify new opportunities,” said Joanne Hageman, the president of NPD’s entertainment sector, when announcing the launch of the U.S. Kids License Tracker. “The cross-industry coverage enables clients to refine their license’s positioning, become more strategic in their marketing and product-development efforts and guide their efforts toward understanding what is most important to their target audience.”

NPD also recently reported that across the 12 global markets it tracks, toy industry sales inched up 1 percent in 2017. In the U.S., they rose by 1 percent to $20.7 billion. Mexico and Russia experienced the fastest growth, partially due to inflation, with sales rising 12 percent and 11 percent, respectively. Sales were flat in Germany and Italy, while the U.K., France and Australia experienced declines.

In this challenging environment, having a strong brand is necessary to rise above the fierce competition.

“We have a company mission, which is to create everlasting memories for children, and that is the central focus for everything we do with our brands,” says Ami Dieckman, the senior VP of international licensing at Entertainment One (eOne) Family & Brands. “What this means is that we’re creating global brands with longevity and making sure that they remain relevant.”

While some companies have a renewable pipeline of content, when it comes to its L&M catalog, eOne Family & Brands prefers to hone in on a few high-quality properties that will hopefully continue to thrive for a long time. PJ Masks has been in the marketplace for nearly three years, and the now evergreen Peppa Pig will celebrate its 15th anniversary in 2019.

“Our overarching global strategy leads with investment in content,” adds Dieckman. “It’s about keeping it relevant, keeping true to the spirit of the original brand but also making sure that people are feeling like they’re getting quality at every point of engagement. If you get that part right, it simply translates to product around the world.”

Atlantyca Entertainment takes a similar approach to investing in a brand’s longevity by ensuring that the content always remains fresh. “We look for strategic partners who are open to building long-term” collaborations, says Marco Piccinini, the company’s licensing manager. “And we develop new style guides in order to refresh our brand and consistently update/transfer the key values of the properties onto the possible retail products.”

Atlantyca’s main highlights for licensing and merchandising on an international level are Geronimo Stilton, a book-based brand that has been enjoying success in the publishing, stationery, food and promotional categories in the U.S., Europe and Asia, as well as Bat Pat, for which “collectible is the key word,” says Piccinini. In Italy, the company is also pursuing additional L&M opportunities for School of Roars, a new preschool series, and H20: Mermaid Adventures, for girls aged 4 to 8.

One helpful (but certainly not crucial) ingredient for L&M success is a property that has already proven itself in the marketplace in one way or another—a trend that has been ongoing for years.

“Toy specialists used to be trendsetters and were more inclined to get behind new properties,” says Marie-Laure Marchand, the senior VP of global consumer product and media distribution for the Asia Pacific, U.S. and U.K. at Xilam Animation. Now, they want “established brands with major marketing and digital support behind them in order to limit risks. Therefore, the main challenge for small independent studios is attracting the attention of retailers. Given the unstable economic situation and the plethora of properties available, they tend to choose the safe brands over potential opportunities from smaller players.”

In response to the demand for tried-and-true properties, Xilam is working on Mr Magoo, a reboot of the classic 1960s series. “We are confident that our fresh take on the show will capture kids’ attention across the globe,” says Marchand. “We have already secured major TV exposure for Mr Magoo through broadcast deals with France Télévisions in France, K2 in Italy, ITV and CITV in the U.K., along with Cartoon Network in Asia, and we have many more partners to be announced soon.” The company’s L&M catalog also consists of the flagship Oggy and the Cockroaches, which is celebrating its 20th anniversary this year, the slapstick comedy Zig & Sharko, and Paprika, Xilam’s first preschool brand.

Mondo TV has also reinvented a preexisting property with Heidi Bienvenida, a live-action franchise that takes inspiration from the 1881 book. “Heidi Bienvenida—a co-pro between Mondo TV Iberoamerica and Alianzas Producciones—is an adaptation of the classic tale of the happy, carefree girl who leaves her beloved mountain home to live in the big city,” says Valentina La Macchia, director of consumer products. “Alongside that engaging storyline, it also offers an exciting mix of themes attractive to its target audience of teens, such as music, comedy, color, magic, love and technology, all of which in turn offer many licensing opportunities.”

Meanwhile, CJ E&M is hoping to launch a new animated series next year centered on Pucca, a popular Korean character. “With love and passion as a subject matter, Pucca will be appealing to every consumer group, regardless of age or gender,” says Joseph Kim, head of the company’s global animation business division. CJ E&M is also currently seeking licensing and merchandising opportunities for Rainbow Ruby, a girl-oriented animated show meant to teach children that they can become anything they want in life.

Another way for a company to achieve success with a brand is to avoid making the mistake of “eating its own young.” As obvious as this may sound, it’s also easy to understand why it might be tempting to want to replicate the popularity of a hit property; after all, imitation is the most sincere form of flattery.

“We don’t expand our portfolio for the sake of it, and we are conscious not to cannibalize on our own brands,” says eOne Family’s Dieckman. “We actually reject quite a lot of content pitches that we come across—even if we love them. There’s just no point in picking up another girls’ 2-to-5 that will directly compete with Peppa, and likewise with a boys’ show” that could potentially pose a threat to PJ Masks.

This is a key strategy for Mondo TV, whose L&M highlights include the teen-geared Heidi Bienvenida as well as the younger-skewing Robot Trains, the second season of which it is co-producing with CJ E&M. “These two properties illustrate an important part of our approach: they don’t conflict with each other,” says La Macchia. “They are aiming at two very different target audiences, enabling us to build clearly defined licensing relationships across brands that complement—rather than clash with—each other.” Mondo TV is also seeking a master toy licensee for Invention Story, an upcoming co-pro with Henan York Animation.

South Korea’s CJ E&M, the IP owner of Robot Trains, is already moving forward with product development for the show. “Even though it is in an early stage of business, the animated series is continuously being launched on major TV channels, and consumers will be able to find Robot Trains toys all over Europe,” says Kim. “Currently, Robot Trains’ L&M program is being developed at a rapid pace, with competitive licensees in a number of major categories.”

One of the other important strategies for a licensing program is deciding on the best time to begin thinking about consumer products.

CJ E&M, for example, starts contemplating a brand’s licensing and merchandising potential from the get-go, according to Kim. “We consider the possibilities for L&M success from the early stage of IP development,” he says. “We think about L&M for our property from the preproduction stage.”

“Atlantyca’s strategy is to pitch the new properties when they are starting on TV,” says Piccinini, “in order to find the right licensees that will release the product 6 to 12 months after the premiere, and put the products on shelves when the series will have reached a strong audience following.”

Over at Xilam, the company starts “pitching for a master toy partner, alongside the publishing category, straight away,” says Marchand. “In general, for brand-new properties we will wait for the first TV ratings to come in before speaking to licensees and then, once brand awareness has started building and the fan base begins to grow, we will introduce the first products into the market.”

According to La Macchia, Mondo TV also plans a brand’s L&M approach immediately. “You have to work in advance to develop a substantial licensing program; you can’t just wait for the property to be already consolidated or launched on TV,” she says.

La Macchia stresses the importance of staying organized and maintaining close contact with retailers. “Brand owners who embrace retail support will see the benefits of investing in retail to drive the brand message outside their traditional channel. Therefore, we ensure at all times that we keep retailers updated about our properties and our TV and L&M plans.” However, she notes, “It isn’t simply a matter of telling licensees our plans and strategy for an exciting brand and expecting them to jump on board. They want guarantees about TV, marketing campaigns and more; that’s why we always try to secure TV broadcasting on the best free-to-air channels and invest heavily in marketing activities in partnership with retail, such as promotional campaigns and loyalty programs.”

Dieckman says that eOne Family contemplates L&M early on, “but we don’t consider it from the point of view of, how do we make this fit in a toy program?” Instead, the company focuses on “creating a holistic consumer-products program, rather than just a brand that we can sell on the shop floor. It’s important to create a program with international appeal, yet still connect with consumers on a local level.”

But even if a company finds itself in possession of a strong brand with long-lasting appeal and manages to choose the perfect time to kick off a licensing program, there may still be additional hurdles to overcome.

Take, for instance, the shuttering of major toy retailers around the globe. “The closure of Toys“R”Us in the U.S. and U.K., as well as La Grande Récré in France, will not just have an impact on ourselves, but on other smaller independent studios too,” says Xilam’s Marchand. “However, we expect this to be partially overcome with potential new lucrative business opportunities that the digital market presents.” She mentions that the company recently launched its own online store, which “gives fans of all ages the opportunity to purchase a wide array of merchandise” based on Oggy. You know what they say—if you want something done right, you have to do it yourself!

The sheer volume of properties on the market nowadays also presents a bit of a problem. “The number of new brands being debuted every year is definitely a challenge for longevity,” says CJ E&M’s Kim.

“It’s a really crowded marketplace,” concurs eOne Family’s Dieckman. “Retail is a shrinking white space right now—everyone’s been affected by it.” But she also sees this obstacle as an opportunity: “It makes you smarter, forces you to think harder about how to get to that shelf space and drive innovation across your product lines to meet the demands of this competitive landscape. Overall, we work harder as a result to produce a real quality brand experience for the consumer across multiple touch points. Let’s talk about how we can really collaborate with the people that are left out there, and how we can support everyone for the benefit of the whole licensing community.”