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China & India Propel Asia Licensed Sales Growth to 2.7%

By Karina Masolova,

Move over China and Japan; India is now the hottest new market for licensed merchandise worldwide. Thanks to these a handful of countries, growth in licensed retail sales within the greater Asian territory nearly matched the worldwide average growth of 2.7% in 2016.

If you’re a current subscriber to the Licensing Data Bank, see more charts and historical data for Asia here. And even if you’re not, click here for a downloadable cheat sheet covering mainland China.

Retail Sales by Country

The largest market in Asia is Japan at almost 50% market share. The country is also the second-largest market for licensed merchandise in the world, behind only the U.S.

But Japan’s licensed retail sales have contracted 0.6% from 2014 through 2016, and its general market was flat at 0.5% GDP in 2016.

While Japan remains the go-to market for established brands seeking a presence in Asia, due to its comparatively mature market and the presence of established agents and manufacturers familiar with licensing, the markets to watch are China and India.

Unsuprisingly, these are also the countries with the highest population. As of 2017, China counts nearly 1.38 trillion people at No. 1, while India has a population of roughly 1.28 trillion at No. 2, according to the CIA World Factbook.

China is remarkable in terms of its relatively rapid slowdown. In 2013, licensed retail sales grew by 8.0%; in 2014, by 9.2%; and in 2015, by 6.0%. In comparison, the 2015–2016 growth rate of 7.0% was an improvement, but it still outperformed GDP at 6.7% in 2016. In this way, China more closely resembles a mature market like the U.S. or U.K., where licensed sales tend to outperform GDP.

While mainland China has enjoyed double-digit GDP throughout the last decade, these growth rates are not expected to be seen again. The biggest challenge for the country’s economy is expected to be the move of “temporary” factory laborers from its large cities and back into the countryside. The decline of its China’s cheap manufacturing labor base will mean that the country’s economy will grow more reliant on imports as well as consumer spending. As mobile penetration increases and ecommerce systems develop, domestic spending is expected to remain stable even in rural areas.

Most of the new growth in China is expected to come from its Tier 2 cities, from which the new middle class is already emerging. The Chinese consumer is increasingly becoming more brand-conscious, and are eager to “trade up” as their fortunes improve. The biggest spending categories, generally, are food/beverages (although it will necessarily be capped at a certain point), apparel, leisure, health and beauty, and travel.

India, on the other hand, has grown its licensed retail sales by almost 20% from 2014–2016, sustaining a 9.2% rise from 2014–2015 and 9.5% growth from 2015–2016. But most of the trends observed with the Chinese consumer also apply to the Indian—greater upward mobility, connectivity, and brand consciousness mean that the population is

One of the major factors contributing to India’s economic growth are the development of roads making large shopping centers more accessible, as well as the proliferation of mobile devices and ecommerce systems.

Smaller Asian countries like Vietnam are another bright spot, but these rapid growth rates are largely a factor of the countries’ size—the tiny nation of Vietnam is ranked No. 49 worldwide by retail sales of licensed products at just $12 million in 2016. Similarly, the Philippines generated just $85 million and Thailand $23 million in licensed retail sales in 2016. On the other side of the spectrum, Macau with just $59 million also fits the bill.

South Korea and Hong Kong, shrinking -1.9% and -4.5% from 2015–2016, respectively, underperformed in 2016 thanks to volatile internal economic conditions. According to the Census and Statistics Dept. of Hong Kong, consumer spending declined by 6.1% in 2016, despite the CIA recording a 1.4% growth in GDP. But South Korea is expected to rebound in 2017 to grow at a similar rate observed in 2014–2015 (2.3%) thanks to a more stable political and economic enviornment.

Retail Sales of Licensed Merchandise, Asia, by Country, 2015–2016
Note: Numbers may not add up exactly due to rounding.
(Figures in Millions)
Rank, Worldwide Country Retail Sales, 2016 Retail Sales, 2015 Change, 2015–2016 Change, 2014–2016 Market Share, 2016
2 Japan $10,125 $10,155 -0.3% -0.6% 49.8%
5 China (mainland) $6,736 $6,295 7.0% 13.4% 33.1%
15 India $811 $741 9.5% 19.6% 4.0%
17 Taiwan $542 $533 1.7% 3.9% 2.7%
23 South Korea $413 $422 -1.9% 0.4% 2.0%
25 Hong Kong $287 $301 -4.5% -3.0% 1.4%
36 Singapore $94 $93 0.5% 1.1% 0.5%
37 Philippines $85 $82 4.3% 8.6% 0.4%
38 Malaysia $64 $64 -0.4% -0.1% 0.3%
40 Indonesia $63 $62 1.0% 1.5% 0.3%
41 Macau $59 $64 -7.5% -16.3% 0.3%
46 Thailand $23 $22 3.2% 5.8% 0.1%
49 Vietnam $12 $12 8.0% 16.1% 0.1%
Others Asia $1,021 $1,001 2.0% 2.1% 5.0%
Total $20,335 $19,846 2.5% 4.8% 100.0%

Retail Sales by Property Type & Product Category

In the latest year for which segmented retail sales by property type and product category are available for greater Asia, entertainment/character-based licensing leads with 38.5% share and over $7.6 billion in retail sales in 2015. As sustained growth continues in the area, TLL expects to see a slightly higher share for fashion- and corporate/trademark-based brands in the coming years.

On the product category side, apparel/accessories/footwear leads with 43.5% share and over $8.6 billion in licensed retail sales in 2015. Publishing and toys/games are the next-largest categories, at 12% and 11.7% share, respectively. Following global trends, the stationery/paper and gifts/novelties categories are expected to stay flat or decline over time. One bright spot we expect to see edge up in share? Health and beauty products, counting just over $640 million in licensed retail sales in 2015.


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