To TLL’s North American readers, welcome back from your long holiday weekend. This last week we saw 5,000 brands at the 2017 Licensing Expo in Las Vegas. Perhaps because of the date shift—the show landed a month earlier this year—there was noticeably less foot traffic on the floor for all three days.
Every year, I get asked, “What were the top brands?” The answer this year the answer is—take your pick. This year’s floor wasn’t overrun by a Frozen or a Minions, and the mood among (relatively) smaller players was highly optimistic. The dominance of A-list properties, after all, is nothing new.
Focus, Focus, Focus
On the whole, a welcome change from last year was the near-universal focus exhibitors exhibited regarding the areas they seek to grow their brands—whether it be in consumer goods, retail distribution, or digital expansion.
Rather than “360-degree” programs that aimed to invade every corner of a consumer’s life (“from their bedding, to their toothbrush, to the emoji on their messenger app”), licensees and agents were keen on promoting partnerships that targeted the root of their brands’ message and their core demographic.
In addition to watering down a property, an over-broad licensing program promotes both consumer and retailer fatigue. With this greater focus, it is likely that even as A-list properties continue to grow their share, they won’t be stealing it from the rest of the industry.
New Players on the Block
One of the most exciting things was seeing the over 140 new exhibitors—Scott Living, Coca-Cola, FAO Schwarz, Funko, Line Friends, Level 5 abby, and others. Look forward to more announcements from them and others over the next couple of weeks.
Generally, home, fashion, and food/beverages brands were better represented on the floor this year. Art brands have always suffered from poor placement at Expo, although this year was somewhat better. That doesn’t mean that the section wasn’t sparse, however.
Lost in Translation
The floor wasn’t entirely dominated by children’s entertainment/character brands from the English-speaking world (namely the U.S. and U.K.)—Asia (China, Japan, and Korea), Latin America, and CEE (in particular, Masha and the Bear from Russia) are getting more skin into the game. And the properties are skewing older, with new content aimed not only at preschoolers, but also at kids ages 6–12 years-old. But foreign brands’ increased presence at Expo doesn’t necessarily translate into deals.
For one, the brand owners and representatives have the doubly difficult task of translating the essence of their properties and otherwise educating retailers on their reach. This should be an obvious step for everyone in the branding business, but even when consumer engagement is high, buyers will snub that which they do not understand.
Another point of difficulty is that most of these properties currently enjoy digital distribution in North America, rather than air time on traditional linear television. And while some properties like Masha will soon air on the small screen, others are currently facing tough realities.
Retailers & Digital-first
Properties whose reach is exclusively through digital mediums such as streaming, YouTube, and social media, aren’t the most attractive option for retailers, who are looking for a sure thing. Just two years ago, getting a mass retailer to stock merchandise based on a YouTube series was unthinkable.
But the mood is shifting, with reports on the floor that even mass buyers like Toys ‘R’ Us and Target appear more open to digital-first properties. I predict that within five years, most retailers will get their heads on straight, and the linear/digital distinction won’t matter. The learning curve might be larger for Cannes audiences (who booed Netflix’s and Amazon’s film offerings at the festival).
Amazon Studios graced the Expo floor for the first time—albeit with a disappointedly small acreage—for its preschool and children’s properties (Tumble Leaf, Wishenproof, etc.). YouTube was noticeably absent, after what appeared to be a disappointing showing at its pavilion last year (admittedly, in a terrible location). But other digital entertainment platforms like Crunchyroll and Buzzfeed were out in full swing with older-skewing properties.
One of the most appealing factors about working with digital-first properties is the detailed level of statistics production companies have on hand to track consumer engagement, and even purchases of merchandise. And of course, digital engagement is second only to the high level of dedication consumers show by buying—and then wearing, eating, or otherwise surrounding themselves with—branded merchandise.
And then there are the brands with strong multi-platform engagement getting into the game. We’re familiar with children’s toy and entertainment brands expanding with short-form YouTube videos, for example. But for the older crowd, one of the strongest players in the social media space is National Geographic, which is aggressively pushing its revamped licensing program.
Virtual Reality (VR) is Getting Real
Last year, we saw a slew of releases for top-of-the-line VR consoles. Adoption, however, remains low. Few consumers are eager to cash in on the higher-priced tech, especially with so few games available (at least, in comparison to “traditional” consoles).
Major game production companies commented that there is little impetus to develop VR-enabled versions of even their most popular titles for this very reason. The noticeable exception on the floor was Sony, which showed off its Ghostbusters VR: Now Hiring for the PlayStation VR.
But that doesn’t mean that production companies aren’t developing VR content. While there is no news fit to print (yet), media companies of every size are staffing up on VR development teams.
One low-cost VR console option is coming this fall from a former Mattel exec with VR Entertainment. While the eyewear resembles Google Cardboard (you bring your own phone), it’s a higher-quality plastic and comes with a steering wheel or fishing rod. The company is expected to sign licensing deals for 2018.
Mini-trends for 2017
Unicorns, rainbows, and princesses are a top trend this year—but next year looks to have a horror slant. Still cute, but in a creepy way.
Live touring shows, character appearances, conventions, and other types of experiential content is back in a very big way. Even as consumers are increasingly accessing brands through digital means, they are excited about experiencing them live. Comic book and anime brands have conventions already baked in to their fan culture, but licensors like A+E Networks and Hasbro are also creating their own, to great success.
The hottest trend of Q1 2017—the fidget spinner—seems to be dead before any licensed products will manage to land shelves.
Notes from the Floor
If you didn’t attend the show, or didn’t get to leave your booth for very long, here are some general notes from the field.
Traffic on Wednesday resembled that of Thursday from yesteryear. While part of the reason was that many exhibitors and attendees took off for the last day on Wednesday afternoon (as they do every year), others explained the difference away by the move of major exhibitors like Disney and Mattel off the main show floor. Despite the slow showing, exhibitors reported brisk foot traffic all-around.
The top “give-away” trend this year was coffee, a welcome shift from last year’s deluge of t-shirts. Most of the major booths were stocked with baristas serving up quality beans. Of the few “giveaways”, there were less USBs and more pens, notebooks, and bottles.
And of course, at the TLL booth we were giving away free three-month digital subscriptions to the newsletter (new faces only). Know someone who might want one—either a colleague in your office, or a business partner? Email me to sign them up.