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INTERNATIONAL

European Licensed Sales Reach $33.6 Billion in 2017

Contact the Editor at karina@plainlanguagemedia.com.

Licensed retail sales in Europe grew 2.2% in 2017 to reach $33.6 billion, according to TLL’s Annual Licensing Business Survey. Visit the Licensing Data Bank for more charts and data here.

At just under 20% share of total worldwide retail sales, Europe slightly under-paced the global growth rate of 2.4% growth in 2017. Within the territory, Western European sales make up 98% of total sales, while Central & Eastern Europe countries contribute just under 2% to total territory sales.

Some respondents to TLL’s Annual Survey reported a surge in pan-European deals in 2017. This rise was attributed variously to larger manufacturers seeking to exploit a license throughout the continent simultaneously, larger retailers which had been aggressively expanding their store count filling up shelves, and consolidated demand for larger licenses.

Retail Sales of Licensed Merchandise, Worldwide, by Territory, 2016–2017
Note: Numbers may not add up exactly due to rounding.
(Figures in Millions)
Territory Retail Sales, 2017 Retail Sales, 2016 Change, 2016–2017 Market Share, 2017
Western Europe $33,033 $32,335 2.2% 98.3%
Central & Eastern Europe $563 $546 3.1% 1.7%
Total $33,596 $32,881 2.2% 100.0%

Distribution Trends

The European retail environment was especially challenging in 2017 thanks to downward retail pricing pressure from mass, discount, and value retailers.

While the share of ecommerce sales grew overall, Survey respondents reported mixed experiences over 2017. Some licensees bemoaned the over-exacting control of licensors who prevented them from taking programs online to Amazon, while others complained of underdeveloped and confused online and social strategies.

Property Types

One licensee summed up the consensus among Europeans: “There are no strong licenses, no new licenses—only remakes.” Entertainment/character brands lead in sales to practically the exclusion of all others.

A momentary trend that peaked in 2017 was rock music brands, but several licensees and retailers remarked that that its popularity wouldn’t extend into 2019.

Western Europe

In 2014, Western Europe turned around three years of decline to post 0.5% growth, followed by growth of 1.5% in 2015. That directionality continued in 2016 with 1.9% growth. And in 2017, that momentum sped up to reach 2.2% growth for total licensed retail sales of $33 billion.

As in the U.S., Survey respondents reported that entertainment/character and corporate trademark brands drove sales in Western Europe.
The largest market, the U.K. saw flattish 1.9% growth in 2017 to reach $7.7 billion in total sales. Attitudes towards Brexit are much more relaxed than they were last year: one agent commented, “The sooner the better!” Uncertainty over the details of business between the U.K. and the continent will continue to depress business, but it is generally accepted that companies will once more have to keep track of fluctuating exchange rates, import/export costs, and differences in law.Europe’s second leading economy with $6.7 billion in licensed sales, France saw 3.5% growth in 2017—a big improvement from tepid 1.5% growth in 2016. While soft sales last year were attributable to Disney properties, Survey respondents pointed to homegrown licenses as the largest generators of licensed sales this year. Foreign properties, meanwhile, continued to see flat or declining growth.

Germany, which led Western Europe with 3.6% growth in 2015, continued to chug along at 2.5% growth in 2017 after 2.6% growth in 2016. Licensed activity remains strong in categories like food & beverage, clothing, home goods, furniture and personal care goods.

Seven countries outpaced the average growth rate in Western Europe (2.2%): Portugal (4.o%), Ireland/Eire (3.8%), France (3.5%), the Netherlands (3.5%), Iceland (3.0%), Germany (2.7%), and Turkey (2.6%).

Greece, which dramatically plunged 25.6% in 2015, bounced back with -5.0% growth in 2016 and 0.2% growth in 2o17. The only two countries to see shrinkage were Belgium (-0.5%) and Luxembourg (-5.0%).

Central & Eastern Europe

The CEE region has finally chucked off the label of the “sick man of Europe” with positive 3.1% growth in 2017. Despite the climb, CEE sales still shrunk -7.1% over the five-year period in between 2012 and 2017.

Several countries in the territory, particularly the ones that are relatively insulated from the Russian economy, have continued to so well. These include Poland (3.6% growth), Hungary (4.1%), and the Czech Republic (4.5%).

On the entertainment/character side, growth can generally be attributed to Disney pumping large amounts of money into the region (as to whether the House of Mouse is getting a return on that investment yet is a different matter). Toy sales continue to do well. More broadly, low-cost, hyper retailers have been expanded into Central Europe at a brisk pace to boost all other categories of licensed merchandise.

Top European Countries, Ranked by Total Retail Sales of Licensed Merchandise, 2016–2017
Note: Numbers may not add up exactly due to rounding.
Rank, 2017 Country Retail Sales, 2017 Retail Sales, 2016 Change, 2016–2017 Market Share, 2017
1 U.K. $7,737 $7,593 1.9% 23.0%
2 France $6,750 $6,521 3.5% 20.1%
3 Germany $5,656 $5,507 2.7% 16.8%
4 Italy $4,434 $4,390 1.0% 13.2%
5 Spain $1,740 $1,716 1.4% 5.2%
6 Netherlands $1,387 $1,340 3.5% 4.1%
7 Belgium $857 $861 -0.5% 2.6%
8 Sweden $774 $764 1.3% 2.3%
9 Turkey $537 $523 2.6% 1.6%
10 Austria $500 $495 1.0% 1.5%
11 Switzerland $452 $450 0.5% 1.3%
12 Denmark $444 $441 0.7% 1.3%
13 Finland $314 $312 0.6% 0.9%
14 Portugal $298 $287 4.0% 0.9%
15 Norway $286 $284 1.0% 0.9%
16 Greece $221 $220 0.2% 0.7%
17 Russia $217 $214 1.4% 0.6%
18 Ireland/Eire $156 $151 3.8% 0.5%
19 Poland $130 $126 3.6% 0.4%
20 Czech Republic $66 $63 4.5% 0.2%
21 Hungary $60 $58 4.1% 0.2%
22 Iceland $41 $40 3.0% 0.1%
23 Luxembourg $19 $20 -5.0% 0.1%
Others Western Europe $429 $419 2.4% 1.3%
Others Central & Eastern Europe $90 $86 4.7% 0.3%
Total $33,596 $32,881 2.2% 100.0%

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