Retail Battle

In the lead-up to Brand Licensing Europe (BLE), rights owners outline the L&M strategies needed to get products onto retail shelves and into consumers’ hands.

Kids do seem to still be getting what they want these days, even with the shuttering of Toys“R”Us earlier this year. Toy sales reached $18.4 billion in the first half of 2018, up 4 percent over last year across Australia, Belgium, Brazil, Canada, France, Germany, Italy, Mexico, the Netherlands, Russia, Spain, the U.K. and the U.S.—the 13 international markets tracked by The NPD Group’s Global Toy Market Report. In the U.S. alone, toy sales were up 7 percent to $7.9 billion.

And the collectibles market continues to be strong, with global sales increasing by 26 percent. In fact, collectibles now account for 11 percent of dollar sales in the overall toy industry. That’s music to the ears of companies like 4K Media, which manages the Yu-Gi-Oh! franchise outside of Asia for parent company Konami Digital Entertainment. Collectibles are high up on consumer wish lists, says Jennifer Coleman, the VP of licensing and marketing at 4K Media. “Offering bespoke and limited-edition collections is something retailers and consumers all around the world are looking for.”

Two different Yu-Gi-Oh! collectible ranges—one from Funko and the other from GameStop—recently launched to the mass market. “We’re also excited to be working with the high-end collectible company First 4 Figures, which is going to be doing a beautiful resin statue for Yu-Gi-Oh!,” Coleman continues.

For 4K, the popularity of Yu-Gi-Oh!’s lead character has been key to its L&M success. Peter Kleinschmidt, the international commercial director of Studio 100 Media and m4e, believes that brands such as Maya the Bee, Mia and me, Arthur and the Minimoys and Wissper also lend themselves so well to toys and other consumer products because they all feature “likable key and secondary characters” that work well for a “wide toy range.”

Marie Congé, GO-N International’s head of sales and business development, notes that as both boys and girls can relate to the titular character in Simon, the property should be a home run in the L&M market. Simon is “an adorable little boy who looks like a rabbit, but he also makes mistakes,” just like young viewers, she says. “Kids can see themselves in him, and children and parents love him.”

CHARACTER APPEAL
Yet, it’s not just the characters themselves that can strike a chord with young viewers. For Joseph Kim, head of the global business team of the animation division at CJ ENM, the messaging behind brands also makes them appealing and can help drive the licensing program.

“Pucca has been a huge hit in the past across the world, and we are rebooting this outstanding brand soon,” Kim says. “With love and passion as themes, Pucca will be appealing to every consumer group, regardless of age or gender.” The same goes for the girls’ property Rainbow Ruby, which “delivers the message that children can become anything they want with their passion and dreams.”

Valentina La Macchia, Mondo TV’s licensing director, also believes that the nature of a property and the storylines in a TV show can drive licensing and merchandising. “Invention Story, the tale of an intelligent, thoughtful and creative fox who in each episode comes up with a new invention, is toy-oriented, most obviously through the various inventions and the tools used to build them, as well as the memorable characters in the show,” she explains.

Kleinschmidt echoes La Macchia, noting that the basis of the licensing and merchandising of Studio 100 and m4e’s brands lies in “continually adding more content to the series in the form of new seasons or feature films.”

Storytelling is also a vital pillar of the L&M strategy for SUNRIGHTS, which represents the Beyblade franchise. “The very essence of the Beyblade Burst brand sets it up for success,” says Natasha Gross, the director of TV sales and licensing at SUNRIGHTS. “The brand is a continuing rollout of new, relevant stories wrapped around highly collectible toys, all lending themselves to further merchandising opportunities.”

Gross adds, “The key to keeping the brand fresh is making sure its television content and merchandise are relatable to today’s young, active consumers from around the world.” Thus, the company is ramping up the brand’s digital and social media presence.

“We have worked on creating a more robust social experience for the Beyblade Burst brand through our GEN BEY campaign [offering fans new products, sneak peeks, giveaways and more] and new partnerships with WildBrain and BeybladeGeeks for a global YouTube experience and new, original social content,” Gross explains.

Once the content message is in place, rights owners must then convince licensees and retailers to support a property. Kleinschmidt notes that the current focus for Studio 100 and m4e is on “signing licensing agents for important markets. Our strategy on new brands is to first get the classic, content-driven categories in place in order to create awareness and acceptance within the target group.” Food and beverage, home and living, and personal care are top-of-mind at the moment. “Regarding Arthur and the Minimoys and Gormiti, we are still looking for licensing partners in several categories,” he says.

For Mondo TV, La Macchia says the goal is to expand its brands’ L&M programs to “any and all territories where our shows are available.”

Similarly, CJ ENM’s Kim states that the company is keen to “enter into every available L&M category for all of our properties, which includes toys, publishing, apparel, accessories, back-to-school, shoes, housewares, food and beverage, promotions and events.”

4K started working with a new subagent in France in the past year for Yu-Gi-Oh!, Coleman says. “We’re still looking to get further penetration for Yu-Gi-Oh! in Europe, including the U.K.” The company also wants to continue the momentum it has experienced in North America and hopes to expand further in Latin America as well. “We are talking to a couple of agents there, so Latin America is probably going to be our next big push following Europe.”

Getting the attention of retailers is never an easy process. It’s one that can be helped along if a property has some level of brand awareness already.

BACK IN STYLE
“For retailers, the awareness level is one of the most significant factors to building trust in a brand,” Studio 100 and m4e’s Kleinschmidt explains. “Every buyer wants products on shelves with a strong turnaround, and we deliver this from the bottom up to marketing campaigns. To work more closely with retailers, we created the position of retail manager last year. This enables us to focus even more strongly on the needs of every retailer and create tailor-made promotions.”

It’s also important to work with licensees to ensure that everyone is on the same page as far as where to take the brand and its L&M program.

“In general, our licensing department works closely with the production staff in order to produce a TV series that is not just a good production in terms of quality and content, but that can also translate into appropriate merchandise,” explains Mondo TV’s La Macchia. “We back up our merchandising work with strong graphical material and the rich style guide we try to provide every time we work on a new show. Character-based graphics as well as logos, patterns, icons, backgrounds and any materials that can aid in the development of good merchandise are part of this process.”

“Finding like-minded partners has always been and continues to be key to our long-term success around the world,” says Mark Teunissen, senior project manager at Mercis, which owns the rights to the classic Miffy property. “We truly relish long-term partnerships and find it very important to grow the business and global footprint together. Our task is to stay extremely focused on what collaborations or other initiatives fit the DNA [of the brand] and will further build on the rich heritage it already enjoys. This not only means finding partners but also sometimes saying no to deals that are commercially very lucrative but not in line with our core values.”

Coleman says that 4K Media works with its licensees as much as possible to leverage opportunities in the retail space. And it helps to have partners that are aware of the brand and what fans want. “The partners that we’re working with are staying on trend. Therefore, the designs that they are then able to create from the style-guide materials that we’re providing them are spot-on.”

To stay true to a brand like Yu-Gi-Oh!, Coleman notes that it is critical to work with partners that aren’t necessarily looking to “stock the next Frozen or Moana. You need to try to embrace your difference, own it and figure out where you can make it work in the market.”

Indeed, in this crowded L&M landscape, it is difficult to be “an independent Nickelodeon, Warner or Disney,” she acknowledges. “It’s an uphill battle. That’s why opportunities with specialty chains such as FYE, Hot Topic and GameStop are so valuable.” It’s retailers like these that tend to recognize the value of niche brands.

KNOW YOUR BRAND
“You have to respect your fan base,” Coleman adds. “It stems from that: be true to your brand, give fans the quality they’re looking for, give them the designs they want, because at the end of the day, if you don’t have them, you don’t have a basis for your business. Respect their knowledge, respect the investment that they’ve made in the brand, and they’re going to come back for more, especially with a brand like Yu-Gi-Oh!”

“The key to standing out lies in keeping your brand connected to its target audience of consumers, knowing what they want and what motivates them into action,” SUNRIGHTS’ Gross maintains. “To that end, we have looked to form licensing, merchandising and promotional deals that keep Beyblade Burst in sync with young fans.”

But rights owners agree, it’s still not easy. “The most difficult thing right now is the distribution of products,” GO-N’s Congé says. “It’s not only limited to dealing with the licensee; it’s getting your licensed product onto the shelf.”

“There is more competition than ever [vying] for less retail shelf space than ever,” says Lloyd Mintz, the senior VP of global consumer products at Genius Brands International, which represents the new girls’ preschool property Rainbow Rangers and the gender-neutral, book-based brand Llama Llama. The company has seen success with Rainbow Rangers, which it created from the ground up in “response to a market void in the girls’ preschool segment.”

Yet, bringing an entirely new property to retail can pose quite the challenge. “While everyone is interested in something new and different, at the same time, everybody is afraid of sacrificing shelf space from the tried-and-true for that ‘something new and different,’ so it’s a bit of a catch-22 for the retailers and the licensors to position their property as that ‘something new and different,’” Mintz explains.

“The biggest challenge is that the market is overcrowded and a property’s life can be very short,” La Macchia of Mondo TV states. “This means we need to make our properties stand out with lots of supporting marketing activities.”

For example, Rocco Giocattoli, the toy distributor in Italy for Robot Trains’ master toy licensee Silverlit, planned a marketing campaign to support the range. Similarly, the Italian launch of Heidi Bienvenida was supported by social media campaigns, competitions, cast interviews and appearances by the show’s star, Chiara Francia.

“Our challenges are to never become complacent or follow what others do, but always rely on the intrinsic strength of the brand and the people working with it,” stresses Mercis’s Teunissen.

Mondo TV’s La Macchia concurs, but notes, “Maintaining momentum is another challenge. We always work on long-term plans to renew the content and the brand constantly in order to keep awareness high and allow licensees to work on a long-term program.”

“It ultimately comes down to a brand’s relevance, collectibility and demand,” adds SUNRIGHTS’ Gross. “You not only have to know and stay in sync with the needs of your target consumer base, you also have to find ways to keep them hungry for and gobbling up the newest iterations of your brand.”