Winter 2014
Departments 6 Editor’s Point
8 Stat Shot
10 Industry Update 12 LIMA Update Looking forward to a new year of licensing, expectations are high for licensed products. 14 LIMA UK Though Christmas is over, licensing executives keep the holiday season going with toy fairs around the world. 39 Blogger Bash Laurie Schacht announces a brand new conference connecting bloggers and brands. 44 Property Profile: Downton Abbey Carnival Film & Television Ltd. and Knockout Licensing bring Downton Abbey into fans’ homes through a full licensing program. 48 Licensing in India Distribution First, Brand Second 50 Licensing Administration Amos Biegun discusses how to minimize risk when implementing complex software. Volume 31, NumbeR 1
Features 16
Toy Fair 2014
Our annual look at the U.S. toy industry’s biggest event, with coverage of licensed products across all toy categories. Check out the latest kids’ properties, as well as the evergreen classics, and what’s on deck to keep kids’ interests up across the board.
42
The World of Licensing
This year’s lineup of blockbusters is expected to produce one of the strongest years in recent history for toys tied to movies. Scarlett Wisotzki, editor in chief of das Spielzeug, discusses past, present, and future trends.
46
The Top Two Reasons Why More Retailers Are Multi-Testing
Carol Spieckerman, president at newmarketbuilders, discusses how the days of trying one thing at a time are quickly fading, the top two reasons why retailers turn to multi-testing, and how this translates into opportunities for brand marketers who are ready to jump into multi-testing mode.
52 SURTEX In its 28th annual show, SURTEX will feature the world’s top artists, designers, studios, and agencies all under one roof. 54 Of Counsel James Kipling discusses the ins and outs of minimum royalty guarantees and what you might be missing. 57 Entertainment Licensing Derrek Lennox analyzes the cost of optioning. 58 Directory
THE LICENSING BOOK, Winter 2014 “THE LICENSING BOOK” (ISSN-0741-0107) is published quarterly, by Adventure Publishing Group, Inc.®, 307 Seventh Ave., Room 1601, New York, New York, 10001. Periodicals postage paid at New York, NY 10001 and additional mailing offices. © 2014 Adventure Publishing Group, Inc®. All rights reserved. No part of this publication may be reproduced or transmitted in any form, or by any means, electronic or mechanical, including photocopying, recording on any information storage and retrieval system, without permission in writing from the publisher. Printed in U.S.A. Subscription rates: $48 per year. THE LICENSING BOOK, THE LICENSING BOOK INTERNATIONAL, WORLDWIDE LICENSING, and the “WLE” design are trademarks and service marks of Adventure Publishing Group, Inc.® registered in the United States Patent & Trademark Office Postmaster: Send address changes to THE LICENSING BOOK, c/o Adventure Publishing Group, PO Box 47703 Plymouth, MN 55447.
EDITOR’S POINT
LICENSINGBOOK
®
THE
Cover Art by Hyperdesign Inc.
www.licensingbook.com
ADVENTURE PUBLISHING GROUP INC.® Vol. 31, No. 1, Winter 2014 I recently took my daughter, Lena, to the preview for The Lego Movie. It was very entertaining for both the adults and the kids in the audience, and when we got home the first thing Lena wanted to do was play with Legos. Well played, Lego, well played. I am certain that the next time we go to the toy store, there will be Legos in my shopping cart. Ask a kid, “If you could have one new toy, what would you choose?” Depending on the child, his or her toy of choice might be Transformers, Barbie, Monster High/Ever After High dolls, Skylanders, My Little Pony, Legos, or Hot Wheels. All of these items have something in common. They are all successful properties launched by toy manufacturers. They all have some form of entertainment attached—movies, TV shows, webisodes, video games, and apps—but the main component of the property is the toy itself. The biggest toy manufacturers— Mattel, Hasbro, Lego, and Spin Master— can really be considered entertainment companies first and foremost (and really, what are toys if not entertainment?). Hasbro, which has always been in the entertainment business with its cartoon lineup, took it to the next level when it launched The Hub Network in 2010, and has had varying levels of success turning some of its biggest toy properties into 6 • The Licensing Book
movie franchises. The next installment of the Transformers franchise, Age of Extinction, will be in theaters on June 27 and will surely give a boost to the toy line and the licensed products as well. Not only are these properties driving demand for toys and saving manufacturers big money on royalties, but, as the property owners, they are making money in the form of licensed bed sheets, backpacks, pajamas, and even toys made by other toy manufacturers. As manufacturers continue to expand their proprietary entertainment properties, often—but not always—successfully, how will traditionally licensed toys be affected? Today, 30 percent of all toy dollar sales and 25 percent of units are in licensed products. However, some experts anticipate a decline. It is expected that the leading toy manufacturers will continue to put emphasis on building their own brands, allowing them more control over their products, and putting more dollars in their pockets. We may even begin to see some decline this year, but I don’t expect licensed toys to become insignificant anytime in the near future. As long as there are companies with irreplaceable content, such as Disney and Sesame Workshop, licensing will remain a critical part of the toy business. ••••
President/Co-Publisher Laurie Schacht laurieschacht@aol.com
Co-Publisher Jonathan Samet jsamet@adventurepub.com
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Stat•Shot
S TAT S HOT The Mobile Landscape
BILLION
The number of smartphones in use last year
1 in 4
Online searches are conducted on mobile devices
$400
By 2015, mobile marketing in the U.S. will generate
BILLION
85
compared to $139 billion in 2012.
Percent of users who prefer native mobile apps to mobile websites 8 • The Licensing Book
PERCENT
SMARTPHONE
PERCENT 41 25 34
TABLET Apple iPad Samsung Galaxy Tab Amazon Kindle Fire
PERCENT
Mobile Market Share
1.4
OPERATING SYSTEM Android Apple iOS Other
Apple Samsung Other
52 40 8
88 9 3
Top 5 Smartphone Apps
based on mobile audience reach 1. Facebook 2. Google Play 3. Google Search 4. YouTube 5. Pandora Radio
Source: WebDAM Solutions, November 2013
Winter 2014
Dollar Sales, U.S. TOY INDUSTRY Supercategories Categories
2012
2013
Action Figures & Role Play
$1.4 billion
$1.4 billion
Building Sets
$2.0 billion
$2.0 billion
Arts & Crafts Dolls
Games & Puzzles
Infant & Preschool Toys Youth Electronics
Outdoor & Sports Toys Plush
Vehicles
All Other Toys Grand Total
$1.0 billion $2.7 billion $1.8 billion $3.8 billion $0.4 billion $4.3 billion $1.3 billion $1.6 billion $1.7 billion $22.0 billion
*Consumer is a sample projected to 100 percent.
Change
2 percent
$1.2 billion
14 percent
$2.7 billion
0 percent
0 percent
$1.9 billion
3 percent
$3.6 billion
-6 percent
$0.6 billion
32 percent
$1.4 billion
10 percent
$1.5 billion
-9 percent
$4.4 billion
1 percent
$1.5 billion
-6 percent
$22.1 billion
0 percent
Source: The NPD Group/Consumer Tracking Service
Top 20 Toy Licenses Within Total Toys BARBIE
IRON MAN
BATMAN
JAKE AND THE NEVERLAND PIRATES
CARS: THE MOVIE
TEENAGE MUTANT NINJA TURTLES
DISNEY PLANES
SOFIA THE FIRST
DOC MCSTUFFINS
STAR WARS
BEYBLADE
DISNEY (ALL OTHERS) DISNEY PRINCESS
DORA THE EXPLORER HELLO KITTY
MICKEY & FRIENDS SESAME STREET SPIDER-MAN
THOMAS AND FRIENDS WWE
*Ranked on dollars, sorted alphabetically **52 weeks starting January 26, 2013 through week ending January 4, 2014 Source: The NPD Group/Retail Tracking Service
Winter 2014
The Licensing Book • 9
Licensing News BRAND LICENSING
Debra Joester, Joanne Loria Named to LIMA Licensing Hall of Fame The board of directors of the International Licensing Industry Merchandisers’ Association (LIMA) has selected Debra Joester and Joanne Loria, co-founders of The Joester Loria Group, for induction into the LIMA Licensing Industry Hall of Fame. Joester and Loria will be honored at the annual LIMA Awards Ceremony on June 17 during the Licensing Expo in Las Vegas. Joester, the company’s president and CEO, and Loria, the executive vice president and COO, have presided over numerous highly successful, award-winning global brand extensions and breakthrough initiatives for some of the world’s most recognizable brands and emerging trends. Joester and Loria’s many accomplishments include strategic brand extensions for food, automotive, and media; reigniting Care Bears as a multi-billion dollar property; and establishing successful programs for pop culture breakout hits.
TV LICENSING
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TV LICENSING
Zodiak Kids, LeapFrog Sign Deal for Tickety Toc
Saban Brands, Bandai Partner for Digimon Fusion Product Line
Zodiak Kids has signed a deal with LeapFrog Enterprises Inc. to have the preschool TV series Tickety Toc available across LeapFrog multimedia platforms and tablets. The first bundle of episodes will be available in the U.S. in February. Future episodes will be released throughout the year and will be accessible through the LeapFrog App Center. The program will launch on LeapFrog devices in the UK and other territories later this year.
Saban Brands has partnered with toy licensee Bandai to produce a product line including toys, trading cards, and digital apps for Digimon Fusion, which is entering its sixth season. The first product in the line, Digimon Fusion Collectible Card Game, is now available. Additional Digimon Fusion products will be available for purchase beginning in midFebruary at various retailers. The Digimon Fusion Shoutmon Smash online game will be available this month on digimonfusion.com, myvortexx.com, and other websites worldwide. Saban Brands will supply additional digital games and digital assets to support TV partners globally for Digimon Fusion.
10 • The Licensing Book
Winter 2014
BRAND LICENSING
BRAND LICENSING
Scientific Games, Hasbro Expand Licensing Deals
Mattel, Epic Records Partner for Multi-Tiered Barbie Campaign
Scientific Games and Hasbro Inc. have amended their long-term licensing agreement to expand the Scientific Games lottery and WMS Gaming brands for real-money Internet wagering. With the amendments, Hasbro brands, including Monopoly, will now be included in social casino gaming channels of distribution. The duration of these licensing agreements has also been extended from 2017 to 2020, with a potential three-year extension. Monopoly has been the No. 1 licensed brand in the lottery industry and is among the top licensed brands in slot machines. Scientific Games has secured the rights to license seven additional Hasbro brands for its slot machine portfolio and has expanded the territories for its lottery licensing rights.
Inspired by the Barbie brand tagline, “With Barbie, Anything Is Possible,” Mattel has debuted a new brand anthem for the doll this year. Serving as a positive, empowering beacon for girls worldwide, the high-energy, catchy pop song will be voiced by all-girl group Fifth Harmony. The partnership with Epic Records/SYCO recording artists Fifth Harmony includes the global debut of the lyric music video on barbie.com, followed by the launch of a music video and a Fifth Harmony Barbie doll collaboration. To celebrate a year of girl empowerment together, Barbie will debut a full-length music video later this year featuring Fifth Harmony that brings the anthem’s spirited lyrics to life. Mattel will also introduce fans worldwide to a Barbie doll collection including five dolls created in the likeness of each Fifth Harmony member. The doll collection is set to launch at select retailers in the U.S. this holiday season and at retailers worldwide in early spring 2015.
BRAND LICENSING
Pepsi and Mountain Dew Sign Deals with New Licensees The Joester Loria Group has expanded PepsiCo’s licensing programs with new tabletop, entertainment, and home décor partners for the Pepsi and Mountain Dew brands. Permasteel has created a line of indoor and outdoor coolers specifically designed for the Pepsi brand that will be available for purchase this spring. Art.com will create Pepsi print-on-demand art and photographic prints, posters, canvas, and wall décor using Pepsi’s graphic archive of more than 110 years. iCup has created a line of everyday glasses, pitchers, canisters, and trays along with a set of acrylic and melamine products. The Pepsi collection took inspiration from more than a century’s worth of logos and graphics to design modern and retro houseware items. The Mountain Dew collection will include mason jars and other novelty items. Both collections will launch this spring and will target both mass-market and specialty channels. Pepsi-brand indoor cooler
Winter 2014
BRAND LICENSING
AALMG Signs Bellagio Resort & Casino for Licensing Program Bellagio Resort & Casino, a AAA Five Diamond award-winning Las Vegas property, has hired All-American Licensing & Management Group (AALMG) to develop a licensing program that will bring the Bellagio Collection of luxury-branded products to retailers nationwide. The collection will include a variety of products, including bedding, bath, furniture, lighting, jewelry, and apparel, all based on the Bellagio brand.
The Licensing Book • 11
LIMA Update
Looking Forward to a New Year of Licensing by Martin Brochstein, senior vice president of industry relations and information, Licensing Industry Merchandisers’ Association (LIMA)
A
s we move into the early part of 2014, the global licensing community feels optimistic about future prospects, while acknowledging some of the issues that need to be dealt with to raise the probability of success going forward. More than 200 licensing professionals worldwide responded to a LIMA survey in late December and early January, and 81 percent expect their licensing business to grow this year. That response level is five percentage points higher than we saw in last year’s survey, when 76 percent of respondents projected increases. Nearly 63 percent of those who responded to the current survey expect to record year-on-year increases of 4 percent or more in their licensing businesses this year. The optimism seen in those numbers is spread fairly evenly among the major constituencies in the licensing business. A higher percentage of property owners (86 percent) than agents (79 percent) and licensees (79 percent) are predicting increases this year. There’s definitely a lot of enthusiasm in the marketplace. One UK licensee says the overall out-
“The industry is full of energy—the retailers, and ultimately the consumers, will determine what’s successful by their choices.”
12 • The Licensing Book
look for the business is “very exciting. There is such a lot of creativity and a striving for new innovation. The industry is full of energy—the retailers, and ultimately the consumers, will determine what’s successful by their choices.” (Survey responses were anonymous, though we asked for company characteristics, such as location and their role within the business.) A U.S.-based licensee expressed confidence that “licensing will continue to live and thrive, but we need to find new models, relative to royalty rates, retailer needs, and over saturation of ‘same products’ in the market. We need to create excitement at retail and make it fun to shop again.” Those are only a few of the challenges that everyone faces. Some are macro issues—the health of local, regional, and global economies and their effect on retailers’ and consumers’ attitudes and spending— that are well beyond the licensing business’ control. Other issues raised by several of the executives are challenges familiar to anyone already in the licensing business—retail conservatism and the dominance of a few strong properties, two factors that are somewhat tied in to the economic environment. “The biggest challenges the licensing industry will face over the next 24 months are the same ones we have been facing since the economic turn-down beginning in 2008,” writes one U.S.-based licensor. “The major problems [are] retail buyers supporting only a small range of licensed properties due to their
Winter 2014
hesitation to provide support to lesser known or ‘unproven’ properties.” Says a U.S.-based licensee: “Retailers either want the standard A property or the next hot thing. It’s getting tougher to build even the strong B properties and to grow hot licenses into ongoing business (versus flashes-in-the-pan).” A European property owner defines the challenge for that territory as “establishing new local brands in a Star Wars/Disney/international brands world.” The increasingly global nature of the licensing business, whether in toys or any other category, offers both a significant growth opportunity as well as a host of challenges. Several executives mention the difficulties of managing currency fluctuations and their effect on profitability, and a few mentioned specifically that overseas markets are being relied upon for their growth. (Seven in 10 of those responding say they expect the percentage of overall business they do outside of their home markets this year to increase.) But there’s some consternation that the global business will go mainly to large multinational licensees. “The number of categories signed by global licensees is growing,” complains one Middle Eastern agent. “It may be easier for a major licensor
Winter 2014
to sign a global [deal], but there are negative implications. It takes the agent out of the game, disincentivizing them, and hurts alignment with media support, which ultimately may hurt brand building.” Another interesting note: Sourcing was raised as an issue for the first time this year. This may reflect the rising profile of environmental concerns and worker safety issues that have arisen over the past 18 to 24 months. One UK licensee says that his biggest challenge is “sourcing and compliance due to the ever-increasing requirements on the auditing of factories.” A U.S.based licensor expressed concern about “our licensees’ ability to source ethical products that are price-competitive.” These and other issues will continue to challenge the business acumen and creative talents of brand owners, entertainment creators, artists, designers, sports marketers, manufacturers, agents, and everyone else who sees the opportunities offered by the licensing model. More than 80 percent expect to show growth this year. As always, LIMA stands ready to be a resource to help those companies reach their goals, and to foster new and creative ways for people to do business. ••••
“[A global deal] takes the agent out of the game... and hurts alignment with media support, which ultimately may hurt brand building.”
Marty Brochstein joined Licensing Industry Merchandiser’s Association (LIMA) in 2008. Brochstein was a business journalist for more than 20 years, covering the consumer products and retail industries. He spent five years as senior editor of Television Digest and was the founding editor of Consumer Multimedia Report. He was also editor of Consumer Electronics Monthly and Electronics Merchandising, and spent time with Discount Store News, Chain Store Age, and Home Furnishings Daily.
The Licensing Book • 13
LIMA UK
I
When the Tables Turn
Licensing executives keep the holiday season going with toy fairs around the world. by Kelvyn Gardner, managing director of Licensing Industry Merchandisers’ Association (LIMA) UK
t’s quite ironic when you think about it: Children spend the whole of December thinking more than ever about new toys. When we get to January, it’s their parents’ turn, or at least those parents involved in the toy industry, the licensing industry, or anything related thereto. In fact, in my early days in licensing, the Harrogate Toy Fair in Yorkshire (still going to this day, but now more of a Christmas supplies fair) used to take place in the slot now occupied by the Hong Kong show. The atmosphere couldn’t have been more different, except in that the first few days of January, both then and now, were a chance for toy executives to celebrate the year that just ended and open the order books for the 12 months ahead of them. There’s still a post-Christmas buzz about the London Toy Fair, which is squeezed in between Hong Kong and Nuremberg, before you may be tempted to move on to New York. It’s hardly surprising, given that this business is perpetually looking forward to Yuletide. It’s also the fact that there’s still a kid in each of us, and I can’t be the only visitor who still loves being exposed to what’s going to be landing in Christmas stockings almost 12 months ahead of time. When visiting toy fairs, licensing executives are looking for several things. Which of these toys—classic, new, or revived—might cross the divide into those brands, such as Transformers or Barbie, that have launched successful licensing campaigns into all other areas of merchandise? What toys will launch in a blaze of glory, only to sink without a trace (Barcode Battler, anyone)? What licenses, evergreen or new, are appearing in ever-wider ranges of toys, confirming or building on the steps that the core intellectual property has taken into the toy world, and
14 • The Licensing Book
the wider world of licensing? To this day, prospective licensees for any new brand never fail to ask of the agent, “Who is your toy partner?” I can’t see that changing any time soon. So, we find ourselves in the Toy Fair aisles acting out several roles at once as we look for new opportunities. First, we’re business analysts, absorbing the marketing plans and the ranges and anticipating the sales results that may deliver plenty of licenses. Then, we’re product developers, wondering how we might turn a highly successful digital gadget into a range of greeting cards, socks, confectionery, or any other product category that represents our own field of enterprise. We’re also spies and detectives, looking to identify that quiet little success-to-be before the competition does, delving into their retail penetration, trying to ascertain if it will soon burst out of boutique distribution and into the retail giants. Furthermore, we’re TV producers, A&R men (and women), web designers, and digital media geeks—creating, in our heads at least, the films, TV shows, music albums, apps, and platforms that will expose these little secrets to the masses, and ensure us of our own big success if we can sign the rights quickly enough. Maybe a visit to a toy fair is a role-playing opportunity for us all. Whichever fairs you’re visiting this year—happy hunting. ••••
Kelvyn Gardner has been in the international licensing business for almost 30 years. Since 2006, he has served as the managing director of the UK division of LIMA. Gardner contributes to the judging of the UK Licensing Awards and is a trustee of the industry's charitable company, The Light Fund.
Winter 2014
Sesame Workshop Heads to the UK, Produce Aisles
Children’s brands Sesame Workshop and CBeebies have joined forces for the first time to co-produce a new children’s show, The Furchester, about a close-knit family of cheerfully incompetent monsters who own and operate an “almost” world-class hotel. Starring Elmo and Cookie Monster from Sesame Street, the show will be filmed at CBeebies’ new home at MediaCityUK in Salford, England. The show aims to develop creative problem-solving skills in young viewers. As the Furchester family scrambles to meet the needs of its guests, the monsters will use some exceptionally fuzzy thinking to devise solutions—some of which even work. The daily mishaps and mix-ups at the hotel provide opportunities to model ways in which preschoolers’ natural curiosity and creativity can be harnessed. The proprietors of The Furchester are Funella Furchester, the welcoming monster owner, her dear and beleaguered husband Furgus Fuzz, and their daughter, the unflappable Phoebe Furchester-Fuzz. Some helpful staffers include Elmo, Phoebe’s cousin, who is on an extended visit and fascinated by all the hotel has to offer—lift buttons to push, phones to be answered, and new friends to make. There is also Cookie Monster, who has landed his dream job as room service and dining room waiter; and Isabel, a furry creature with a bell on top. The series enters production this year and will debut on CBeebies in the fall. Sesame Workshop, along with the Produce Marketing Association (PMA), has joined the Partnership for a Healthier America (PHA) in a two-year agreement to promote fresh fruit and vegetable consumption. The agreement allows Elmo and Cookie Monster will appear on The Furchester PMA’s community of growers, suppliers, and retailers to take advantage of Sesame Street’s brand strength and influence without a licensing fee, using characters including Big Bird, Elmo, Rosita, and Abby Cadabby to help deliver messages about the value of fresh produce. Shoppers can find Sesame Street characters in stores by mid-year. Sesame Workshop is also excited about the new Sesame Street infant toy line from Prestige Toys, which is launching at retail in July. Rosita for Partnership for a Healthier America
Winter 2014
Illustration of Sesame Street musical pull toys, from Prestige Toys
The Licensing Book • 17
DEMDACO Makes Plush Modern and Colorful Knitzies plush
DEMDACO’s Knitzies is a high-end plush line designed by licensed artist Lori Sieber. These whimsical animals have hand-crafted, unique looks that use a mix of patterns, prints, and textures. Knitzies plush toys are branded as “huggable hand-me-downs” and are suitable for kids of all ages. Nat & Jules, by DEMDACO, has partnered with the children’s apparel brand Zutano. This new line of products blends plush toys and keepsakes with the modern designs of Zutano’s apparel. Along with plush animals and dolls, the line includes children’s activity toys, rattles, accessories, picture frames, and banks.
Saban Brands Shows Off New Power Rangers, Digimon, and Julius Jr. Toys and Merchandise
Saban Brands will show off new merchandise for its Power Rangers franchise, coinciding with the launch of Saban’s Power Rangers Super Megaforce on Nickelodeon this year. Global master toy licensee Bandai America has released a new edition of the Power Rangers Scanner app, available on iTunes and Google Play. App users can unlock new functions by using the Key Scanner feature on Ranger Keys, which are sold with Power Rangers Super Megaforce toys. One of the new functions allows users to morph into a Power Ranger by uploading a portrait and scanning the key. Another digitally integrated toy is Swappz Interactive’s Power Rangers Megaforce: Swappz MegaBrawl, a mobile game for iOS and Android. With Swappz MegaBrawl, kids can scan in their Swappz Power Rangers collectible characters using their smartphones or tablets and, within seconds, their Power Ranger transports into the game complete with special abilities. Bandai is the global master toy licensee for Digimon Fusion, the sixth installment of the Digimon franchise. A new product line will launch this year, ranging from a combination of boys’ action toys and figures to construction, and incorporating the show’s digital elements into the designs. The series airs on Nicktoons and will premiere on Vortexx on The CW this year. The animated preschool series Julius Jr. is inspired by the lovable characters of Paul Frank. The show currently airs on Nick Jr. in the U.S. and will premiere in international markets later this year. Licensed products will hit shelves in the fall, with categories including toys, apparel and accessories, craft and activity, publishing, role play, and more. Fisher-Price Inc. will serve as the global master toy licensee for the property.
18 • The Licensing Book
Winter 2014
The Bridge Direct’s Menu Features Strawberry Shortcake
The Bridge Direct will introduce new toys for its entertainment licenses. The Strawberry Shortcake Sweet Beats Stage Playset puts Strawberry Shortcake and Cherry Jam center stage with their band, the Sweet Beats, for a live performance. The stage sparkles with bright lights and plays clips of two songs from the TV series Strawberry Shortcake’s Berry Bitty Adventures. The play set includes Strawberry and Cherry dolls. The Strawberry Shortcake Sweet Beats Singing Doll stands 11 inches tall and is dressed in a sparkly ensemble. When Strawberry’s microphone is raised to her mouth, she sings and gives shout-outs. From The Bridge Direct’s Basic Fun division comes the My Little Pony Charmling Bracelet. There are a total of 12 pony charms and assorted bracelets to collect, and each package contains one bracelet and three charms. The My Little Pony Rainbow Dash Keychain causes Rainbow Dash to change through a rainbow C3 WWE StackDown Ring Playset of colors when kids touch the bottom of the magic cloud. The WWE StackDown Universe is part of the new C3 construction brand, which lets kids create, construct, and customize. The C3 WWE StackDown Ring Playset includes three figures with snap fit design—John Cena, The Miz, and a referee—and more than 350 pieces. The C3 WWE StackDown Train ’n Rumble Playset lets kids recreate brawls between Rey Mysterio and Sheamus in a two-level training room. The play set includes more than 200 pieces, including a weight rack. C3 WWE StackDown Starter Sets include High Flyin’ Sin Cara, Kofi Kingston with Ladder Match Set, and Santino Marella’s Cobra Cage. Each set includes one figure and more than 70 pieces, as well as unique accessories.
Doctor Who Regenerates as Underground Merchandise
Doctor Who celebrated its 50th anniversary last year, and this year, Underground Toys will unveil new additions to its Doctor Who electronic plush assortments, including Daleks and the Tardis with LED lights and sound effects for its 24-inch talking plush range. The Doctor Who Pocket Pal Talking Clip-On features sound effects and phrases from the Daleks, the Cybermen, the Doctor, and the Tardis. The key chain features a sculpted mini replica of the iconic Tardis. Underground’s Doctor Who Tumbling Tardis Tower, a classic, family-friendly game of skill built of 36 Doctor Who Tumbling wooden bricks, challenges players to poke, push, pull, and wiggle the bricks one at a time and build the Tardis Tower Tardis Tower high without letting it tumble. New figural collectibles include the highly detailed Doctor Who 4-inch collectible resin figurines and a separate range of new 3.75-inch action figures, alongside one-of-a-kind collectibles. Part of Underground Toys’ new range of Doctor Who accessories are stylized wallets, tote bags, and iPhone cases. Some special 50th anniversary editions within the ranges incorporate artwork from designer Anthony Dry. Additionally, Underground Toys has interactive and battery-operated toys, including R/C toys and role-play toys, such as sonic screwdrivers; a range of computer accessories, such as USB hubs and desk protectors; kitchen accessories, including cookie jars, teapots, and mugs; and high-end collectible watches, alarm clocks, and wall clocks.
Winter 2014
The Licensing Book • 19
Mattel, Marvel Team Up for Super-Powered Hot Wheels Products
Mattel and Marvel have collaborated on co-branded Hot Wheels cars and play sets featuring Marvel’s iconic superheroes. The Hot Wheels Marvel Ultimate Spider-Man Web Swing Drop-Out Play Set is themed to Marvel’s Ultimate Spider-Man animated cartoon. The object of this gravity-based set is to make Spider-Man’s web swing back Hot Wheels Marvel The Amazing Spider-Man 2—Speed Circuit and forth and then launch the enemy Venom car toward him. The vehicle escapes the web, Showdown Play Set gets knocked off the track by the web, or gets caught in the web. Based on this year’s new The Amazing Spider-Man 2 film, the Hot Wheels Marvel The Amazing Spider-Man 2—Speed Circuit Showdown Play Set includes a 1:64-scale car that represents the villain Electro. The set features a battery-powered booster and a figure-eight track for continuous play. The Hot Wheels Marvel Hulk Smash Spin-Out Track Set is based on Marvel’s Avengers Assemble animated cartoon. The set includes a 1:64-scale basic car representing the Hulk’s archenemy, Abomination, and features a four-speed launcher, a jump ramp, and a Hulk figure with spinning and smashing fists to smash Abomination in mid-air. Mattel will also introduce the Hot Wheels Marvel Character Car Assortment, which features 12 vehicles. All of these sets are designed for kids ages 4 and up.
eOne’s Peppa Pig Is Ready for Prima Time
Entertainment One (eOne) will expand the Peppa Pig brand with new toys and a DVD. The Peppa Pig Singing Ballerina Peppa, from Fisher-Price, is dressed as a prima ballerina. Kids ages 3 and up can give Peppa a squeeze to hear her talk and sing a ballerina song. Also from Fisher-Price is Peppa’s Ballet Bag, suitable for kids ages 3 and up. The set features Peppa Pig and Candy Cat, who are getting ready for their big ballet recital. They can warm up on the ballet barre, choose which of three tutus to wear on stage, and check out their prima ballerina moves in the included mirror. Everything stores inside the ballet bag. The My Birthday Party DVD welcomes kids ages 2 to 6 to the charm and magic of Peppa’s world with 14 episodes and two never-before-seen educational extras, “Learn the Alphabet” and “Learn to Count.” In the title episode, “My Birthday Party,” it’s Peppa’s birthday and all of her friends are invited to her party, where Daddy Pig attempts to perform a magic show. Other episodes feature Peppa’s animal friends, such as Suzy Sheep, Pedro Pony, and Danny Dog, and include an exciting boat race, a school play, and more adventures. Peppa’s Ballet Bag
20 • The Licensing Book
Peppa Pig Singing Ballerina Peppa
Winter 2014
Lego’s Licensed Lines Appeal to Everyone
New to Lego’s Disney Princess line is Cinderella’s Romantic Castle. Kids ages 6 and up can explore the castle’s different rooms, attend a ball with Prince Charming, and find the key that unlocks the treasure chest full of jewels. Romance is in the air as Cinderella and Prince Charming dance and share a moment in front of the fireplace. The set includes Cinderella and Prince Charming mini-dolls, Lucifer the cat, and Bruno the dog. Also new to the Disney Princess line are Cinderella’s Dream Carriage, Rapunzel’s Creativity Tower, Merida’s Highland Games, Ariel’s Magic Kiss, and Ariel’s Amazing Treasures. Little superheroes can build the DC and Marvel Universes with the new sets in the Lego Super Heroes line. DC fans can strap Batman into the ultra-fast Batcopter, fire up the powerful engine, and help Nightwing foil Man-Bat’s attack on Gotham in
the Batman: Man-Bat Attack set. The set includes Batman, Nightwing, and Man-Bat minifigures with an assortment of weapons. Marvel fans ages 7 and up can rescue Mary Jane in the Spider-Helicopter Rescue set. Kids can help Power Man and SpiderMan launch the web net at the Green Goblin. If that fails, they can release Spider-Man from the helicopter and swing in with the web to carry Mary Jane away. The set includes Spider-Man, Power Man, and Mary Jane minifigures, and a Green Goblin figure. Lego will also extend its Lego Star Wars line with a new Clone Turbo Tank; classics such as the Millennium Falcon, TIE Interceptor, and X-Wing Fighter; and more. With the Battle on Saleucami set, kids can stage a battle against the Droid Army and fire the powerful BARC speeder springloaded shooter to knock down droids.
Batman: Man-Bat Attack
Kids Preferred Brings Kids’ Classics to Life
Kids Preferred will release new toy and gift lines inspired by children’s books. The Guess How Much I Love You collection, based on the work of Sam McBratney and Anita Jeram, will debut this year with new products. The Guess How Much I Love You Rattle features Nutbrown Hare on top of a soft rattle that has the book’s title message printed on its side. He also appears on the Guess How Much I Love You Light-Up Pullstring Musical Toy, which brings together music, lights, and a light-up moon with the slogan, “I love you right up to the moon and back.” The Guess How Much I Love You Jack in the Box offers music and action, as Nutbrown Hare jumps out of the colorful musical box, which features art from the book on all four sides. With The Very Hungry Caterpillar as its centerpiece, The World of Eric Carle, represented by the global licensing agent The Joester Loria Group, has inspired both a Little Artist and a Little Musician Collection. The Little Artist Collection for spring includes artistic toys and accessories, such as a wood easel with a paper roll and paint cups. The set also comes with a chalkboard, a dry-erase board, and magnets that can be used to display artwork. From castanets to maracas, the Little Musician Collection helps kids make their own music and march to their own beat. Select items from the spring collection include wood maracas in caterpillar and ladybug shapes, designed to stimulate and to be shaken. The maracas are contoured for easy holding and maGuess How Much I Love neuvering, as well as safety. You Jack in the Box
22 • The Licensing Book
Winter 2014
Make a Beeline for New Anchorman Collectibles
Beeline Creative will introduce new Anchorman collectibles. A new series of 8-inch collectible action figures features the entire Channel 4 News Team: Ron Burgundy (Will Ferrell), Champ Kind (David Koechner), Brick Tamland (Steve Carell), and Brian Fantana (Paul Rudd). Each figure includes a custom-tailored fabric suit and a signature accessory. The 13-inch Ron Burgundy features 12 iconic movie quotes, two customtailored outfits, six accessories, and “Scotchy Scotch Scotch Vision.” The 7inch Bronze-Style Ron Burgundy Collector Bust has an engraved nameplate of the popular newscaster for display. Also from Beeline comes new Stretchable Helmet Covers that transform helmets into Teenage Mutant Ninja Turtles characters. Designed to fit all helmet sizes, the Stretchable Helmet Covers will be available this fall alongside Bike Safety Lights and Bike Sound Effects. Additional licenses and a variety of original designs will also be available. Anchorman 8-inch collectible action figures
Goldie Celebrates Transformers’ 30th
Goldie International will introduce a set of miniature figures to celebrate the Transformers brand’s 30th anniversary. The Transformers 30th Anniversary Figurines Assortment features characters from the past 30 years, including the Prime, Film, and Generation styles. The figures come in single, three-, and fivepacks, and are suitable for kids ages 7 and up.
Cuddle Barn’s Lil Bub Gives Back
Lil Bub, the female cat known for her ever-protruding tongue and big eyes, is an Internet feline sensation. Her success has led to TV appearances, a heavy web presence, a documentary, and her own book and web series. Lil Bub uses her celebrity status to advocate for homeless and special needs pets worldwide. With her big green eyes and signature tongue poking out, Lil Bub is now a plush toy from Cuddle Barn. With this soft plush suitable for kids ages 3 and up, Lil Bub’s fans can share her joy for life as they snuggle up with their favorite feline. In keeping with Lil Bub’s charitable efforts, Cuddle Barn will donate a portion of the proceeds to good causes.
Transformers 30th Anniversary 5-Pack
Winter 2014
The Licensing Book • 23
Mega Bloks’ New Barbie Set Is Fab and Fashionable
The Mega Bloks Barbie Fab Mansion features five rooms and a patio to build and decorate, and includes Barbie and Skipper mini-fashion figures. The Mega Bloks Hello Kitty—Fun at the Fair set includes more than 200 pieces and two Mega Bloks Hello Kitty figurines, a moving merry-go-round, and a ferris wheel. The Mega Bloks Skylanders Swap Force—Skylands Spinner Assortment lets kids choose their hero and build, spin, and smash their way to victory. Kids ages 5 to 7 can assemble the spinner, choose a battle tip, and launch their hero into the Frost Guard Battle Arena. Mega Bloks will introduce the new SpongeBob SquarePants construction line, which features collectible micro-action figures, buildable vehicles, and Mega Bloks Barbie Fab Mansion play sets. The main tank of the Mega Bloks Call of Duty Heavy Armor Outpost is a direct fire, heavy armored vehicle. Designed for kids and collectors ages 14 and up, it comes with a heavy machine gun and main cannon on a rotating turret, and tracks that spin.
Wicked Cool Features Monster Jam, WWE
Wicked Cool Toys and Feld Entertainment have rolled out a new line of licensed Monster Jam novelties and plush. Popular Monster Jam trucks, including Grave Digger, Max-D, and Monster Mutt will be featured in fall product assortments, including Total Destruction key chains, high-flying coin banks, 6-inch plush Total Destruction slammers, and 16-inch plush Crashers. Wicked Cool has secured rights to expand its WWE portfolio with collectibles, novelties, electronic products, and more for the fall. The WWE Superstar toy line for spring will include Superstar Bands, ThumbPERS, key chains, microphones, banks, and bobble head figures. Wicked Cool Toys will also introduce the Real Scale Collector Ring, measuring 22 inches by 22 inches, as well as gigantic, fully articulated 31-inch figures. Wicked Cool Toys’ portfolio has expanded this year to include toys in licensed categories such as preschool, plush, novelties, role play, electronics, and travel accessories. Crashlings, a boys’ collectible line, will be the company’s first TV-promoted line and national TV campaigns will run throughout the year. New licensing deals include Disney, Marvel, DC Comics, Monster Jam, and a master toy licensing agreement with Wild Kratts. New categories utilizing top licenses include Vrüm for ride-on portable storage, as well as mobile tech accessories such as Hero Holders, which are action-figural holders for touch-screen devices that resemble favorite branded 31-inch WWE John Cena characters. Made in partnership with Status Media, Hero Holders feature licenses including WWE, Teenage action figure Mutant Ninja Turtles, Marvel, and Warner Bros. Wicked Cool Toys will also introduce a comprehensive line of figures, accessories, vehicles, play sets, role play, and plush products based on its master toy license for the PBS show Wild Kratts. In addition, the company will also expand its programs with The Wiggles and Teenage Mutant Ninja Turtles.
24 • The Licensing Book
Winter 2014
Tomy Has Heavy Kid-Sized Machinery
Tomy has redesigned its John Deere Steel Stake Wagon this year. The classic wagon features rugged steel construction, a new StableSteer front axle for easy maneuverability,
and smooth-ride pneumatic tires. The wagon is designed for kids ages 2 and up.
Kids can help John Deere and his hard-working crew tackle everyday adventures on
the farm and construction site with the Gear Force vehicles, designed for kids ages 3 and up. The Gear Force Combine Harvester Playset has the largest vehicle in the John Deere
Gear Force fleet. The Combine features sounds and lights, and can pick up bales and pop them
Chuggington Checker Station Set
out of the hopper. The play set includes three figures, a bull, and accessories.
Based on Checker Station from season four of Chuggington, the Checker Station Set is for be-
ginning engineers. As Wilson rides through the swing gates and pulls into Checker Station, he must take the elevator up to the top
before heading on his next adventure. This set includes an elevator, swing gates, and a die-cast engine. It also features two levels of
elevation and multiple layouts, and is designed for kids ages 3 and up.
Tomy’s new Pokémon toys, inspired by the Pokémon X and Pokémon Y video games, include soft plush figures that are 8 inches
tall and designed for kids ages 3 and up. Kids ages 4 and up can battle their favorite Pokémon head-to-head with Pokémon X and
Pokémon Y 2-inch figures. The sets include Chespin vs. Wobbuffet, Fennekin vs. Meowth, Froakie vs. Eevee, and more. Each pack
contains two detailed 2-inch figures and two Attack Tags to bring kids’ battle play to life.
Kids Have Fun Learning with The Young Scientists Club
The Young Scientists Club will expand its line of science kits for kids. The Magic School Bus Math Explosion lets kids ages 5 and up
hop on board with Ms. Frizzle and discover science and math in an entertaining game. Players can customize
math facts with a math fact creator. The goal is to be the first player to explode the volcano by getting
their math facts correct. The two-sided, laminated game board includes both a speedy and an extended
game, volcano facts in the border, a volcano for the explosions, a bowl to catch the volcanic lava, and
colorful measuring cup game pieces. Also included in the kit are bonus cards, printable math
fact sheets, and an online math creator.
With The Magic School Bus Engineering Lab, Ms. Frizzle and her students invite kids
ages 5 and up to explore the world of engineering. Kids can become engineers in the kitchen
by building a solar oven, designing a car, constructing a bridge, and creating solar en-
ergy. This bus-shaped kit comes with 33 colorful experiment cards, a data notebook to
record experiment designs, a solar panel, a motor, a buzzer, and electric wires.
With the Clifford Animal Science kit, young scientists ages 3 and up can use the in-
cluded lab tray, measuring cup, and magnifying glass to perform experiments.
The Clifford Food Science kit lets kids explore the science of food with tasty experi-
ments such as rainbow ice, ice cream in a bag, homemade butter, rock candy, and more. The
kit includes a lab tray, a measuring cup, test tubes, a funnel, and a pipette.
26 • The Licensing Book
The Magic School Bus Math Explosion
Winter 2014
Rubie’s Brings Out Kids’ Inner Hero
The Teenage Mutant Ninja Turtles Deluxe Donatello costume, from Rubie’s Costume Co., includes a jumpsuit with an attached belt and shoe covers, elbow pads, knee pads, a mask, and a stuffable shell. From Despicable Me 2, the Evil Minion costume includes a one-piece purple foam costume. Kids can also dress up as DC Comics’ superheroine, Wonder Woman, with a costume that includes a tutu dress, a cape, gauntlets, a belt, and a matching headpiece. On the other end of the comic book spectrum, the costume for the super-villain Harley Quinn includes a tutu dress, a headpiece, an eye mask, and glovelettes. Harley Quinn
Kids Can Rock Out with Sakar
Sakar International’s new kid-safe headphones allow kids to safely listen to music. The kid-safe headphone series features a built-in volume limiter, protecting kids’ hearing by automatically limiting audio volume to approximately 80 percent of the original maximum volume. These headphones are compatible with all devices that feature a 3.5mm stereo jack output, such as laptops, PCs, CD players, and home audio systems. Sakar’s collection of kid-safe headphones feature designs from licenses including Hello Kitty, Batman, Superman, Iron Man 3, Monster High, and Teenage Mutant Ninja Turtles.
Teenage Mutant Ninja Turtles Deluxe Donatello
eKids’ Disney, Marvel Styluses Are Real Draws
The Disney Creativity Studio Smart Stylus, from eKids, lets real Disney artists teach kids how to draw their favorite Disney characters. Activities such as tracing, connect the dots, and coloring provide hours of fun. Kids can access more than five different drawing tools, flip the stylus to erase, shake the stylus for special art effects, and easily change the line thickness for precision drawing. Complete with sound effects, backgrounds, and a variety of coloring and drawing tools, kids can use an iPad to create their own superhero scenes with the Marvel Creativity Studio Smart Stylus. The Stylus includes professionally illustrated coloring pages where kids can add flair with drawing tools and an extensive color palette and unlock special tools to color the page. An interactive grid system includes specialty drawing aids, such as side-by-side drawing canvas, trace lines, and a drawing scope, allowing artists of all levels to successfully learn how to draw these characters. Artists can build and animate action scenes with character stickers, sound effects, speech bubbles, and backgrounds, and can create custom stickers to add to the animated scenes. Marvel Creativity Studio Smart Stylus
Winter 2014
The Licensing Book • 27
Hasbro Has Elmo for Sing Alongs and Bathtime
There are three ways to play with the Elmo Guitar from Hasbro.
Toddlers ages 18 months to 4 years can sing along with Elmo to
New to the My Little Pony line is Pinkie Pie’s Rainbow Hel-
icopter Playset. This heart-shaped helicopter has a colorful rain-
“This Old Man,” “Row, Row, Row Your Boat,” and “Elmo’s ABC
bow propeller for kids ages 3 and up to fly Pinkie Pie around
light-up keys and whammy bar. Kids can also switch modes to
gage rack, and fashionable accessories.
Song,” or they can switch into free play mode and jam on the
play a color game with Elmo.
Toddlers can sing aloud with Super Grover on the Super
Grover Microphone. This brightly colored microphone features
Equestria. She travels with a small pink suitcase, a rolling lugMy Little Pony Equestria Girls Dolls That Rock let kids ages
5 and up make Pinkie Pie, Twilight Sparkle, or Adagio Dazzle
high-five and come to life singing the “My Little Pony Equestria
Super Grover singing “Old MacDonald Had a Farm,” “The
Girls” song. Each doll comes with fashionable accessories and a
The Elmo Bath Adventure Steamboat is a five-in-one bath
Glimmering wings, rainbow accents, and colorful, cascad-
Wheels on the Bus,” and “If You’re Happy and You Know It.”
toy for kids ages 18 months to 4 years. The
cabin is a water scoop, the smoke stack is a
musical instrument.
ing manes make the My Little Pony Fantastic Flutters winged
ponies look majestic. Kids can look for Princess Celestia, Princess
strainer, the hull floats, Captain Elmo floats
Twilight Sparkle, and Princess Cadance figures,
and squirts water, and the paddle wheel
each with gorgeous glow-edge wings and cutie
sticks to the tub wall.
mark-shaped glitter that swirls inside
This spring, Grover and Bert will
each translucent, water-filled pony
join the Sesame Street mini plush col-
figure when it is tilted or moved.
lection. Kids ages 1 and up can take
New this spring, Transformers
these soft and cuddly take-along pals on
the go.
The Sesame Street Racers Assortment fea-
Battle Masters Challengers bring Elmo Bath Adventure Steamboat
tures new vehicle two-packs that include Elmo driving an ice
Transformers characters to life. Play-
ers ages 5 and up must get their Autobots and
Decepticons into the ring to see who will rule after ultimate bot-
cream truck and Oscar the Grouch in a recycling truck, and Ernie
smashing action. The game comes with a special digital code that
bus. Additional duos include Super Grover and Cookie Monster,
which will be available in April. The game includes one figure
driving a tow truck and Big Bird behind the wheel of a school
unlocks more features in the Transformers Battle Masters app,
Big Bird and Elmo, and Ernie and Cookie Monster.
and a controller.
sortment features Marvel Super Heroes and villains with inter-
ages 3 and up to immerse themselves in the worlds of their fa-
create their ultimate hero. Each Marvel Super Hero Mashers elec-
or Snow White as they travel along the 3-D game board through
The Marvel Super Hero Mashers electronic action figures as-
changeable parts and accessories, so kids ages 4 and up can
tronic action figure comes with Battle Gear pieces, including a launching missile and an electronic light-up piece, plus addi-
tional mash-up pieces for even more combinations. Four figures
will be available in this assortment this year.
28 • The Licensing Book
The Pop-Up Magic Disney Princess Castle Game allows kids
vorite Disney Princesses. Kids can play as Ariel, Belle, Rapunzel,
twists and turns to the magical pop-up castle to win. The set in-
cludes four princess figurines and friend tokens. Also available
are Pop-Up Magic Disney Tangled, Cinderella’s Coach, and
Frozen games.
Winter 2014
Cardinal Turns 70 with More Licenses
In 1944, Les Berger founded Cardinal Industries as a manufacturer of dominoes, poker chip racks, hula-hoops, and Mah Jongg sets. Seventy years later, the company has grown into a board game and puzzle company with worldwide reach and an extensive number of licensed products. This year, Cardinal will have new Color Your Own puzzles and games that use Crayola technology, including Color Wonder and Color Explosion, and will feature licensed characters from Disney, Marvel, Mattel, Sanrio, Hasbro, and Despicable Me. The company’s latest games also include Hollywood Game Night!, based on the NBC TV show. It features five action-packed mini-games, such as Celebrity Name Game and Take a Hint. The My Little Pony Rainbow Magic Game challenges players to work together to form a magical rainbow. Meanwhile, the Thomas the Tank Engine Topsy Turvy Turntable Game challenges players to balance freight atop a Troublesome Truck, and comes with both Thomas the Tank and Troublesome Truck figures. Cardinal will continue to add licenses to classic games such as Toss Across, Tip it, Uno, and Scrabble. Children’s playing cards will feature licenses such as Disney and Marvel. For adults, there will be playing cards featuring imagery from The Walking Dead and the U.S. Army. Cardinal’s new puzzle line will feature the pop art of Lisa Frank. These puzzles are bright and colorful, featuring images of unicorns, cute animals, and rainbows, and packaged in lunchbox-style tins, boxes, and bags. The unique Puzzle Binder has eight puzzles packed in an actual binder with compartments for storage and display.
Bandai Expands Power Rangers Line
Bandai has added Legendary Ranger Keys to its Power Rangers toy line. Every Zord Builder and roleplay toy SKU comes with at least one Ranger Key that activates different functions, giving these toys more extensive play value. Role-play items interact with the keys to unlock unique sounds and features. Each key includes a code that activates a morphing and battle sequence when scanned with the Power Rangers Scanner app for smartphones and tablets. New to the Zord Builder line, the Power Rangers Super Megaforce Deluxe Megazord includes a Ranger key and five individual Zords that can be combined. The key inserts into the back of the Megazord to open the chest compartment to store items, including the Ranger Key. The Super Megaforce Deluxe Megazord connects with other items in the Zord Builder Collection. The line also includes new 5-inch Action Hero figures with 13 points of articulation, two accessories, and 6.5-inch Double Battle Action Figures, which allow kids to control the figure’s arms and battle gear Super Megaforce Deluxe Megazord through the lever control on the back of each figure. A pack that includes three Ranger Keys is also available. Bandai will also introduce the Power Rangers Super Megaforce Deluxe Legendary Morpher and the Deluxe Super Mega Saber. The Morpher allows kids ages 4 and up to insert Legendary Ranger Keys to activate lights and sounds. There will be approximately 60 keys available to collect and key combinations will unlock additional phrases. The Super Mega Saber features battle sounds and lights and comes with one Ranger Key. Ranger Keys activate more LED lights in the blade, along with additional battle sounds.
30 • The Licensing Book
Winter 2014
NKOK Brings Favorite Characters to the Open Road
NKOK puts a fun twist on Nickelodeon’s SpongeBob SquarePants cast by turning the characters into vehicles made of squishy vinyl that never scuffs or breaks. Designed for kids ages 3 and up, these vehicles play SpongeBob’s signature “Getaway” song whenever he tries to get out of a jam. The WWE Diecast Hauler adds to NKOK’s licensed line of die-cast haulers, R/C vehiSpongeBob cles, and other die-cast race cars for kids ages 8 and up. These collectible haulers feature fan-favorite Vinyl line wrestlers’ faces, and different themes and variously colored trucks accompany different wrestlers. NKOK has teamed up with the animated cartoon Scooby-Doo to create R/C vehicles featuring the mystery-solving gang and their dog pal. The Wheelie Mystery Machine features Scooby as the driver. Kids ages 3 and up can zoom around, pop wheelies, or do other fun tricks with Scooby. This vehicle features button-activated sounds and motion. NKOK has also teamed up with Discovery Kids to make learning an engaging and fun-filled experience. The R/C T-Rex lets kids ages 4 and up explore the world of lights, sounds, and dinosaurs. They can play and learn with this T-Rex whose eyes light up and flash. The dinosaur walks and roars at a kid’s command.
Carrera Is on Track
Cars’ Francesco Bernoulli and Lightning McQueen can duel and light up in neon with Carrera’s Shift ‘n Drift. The 6.2-meter circuit provides space for racing maneuvers. The loop, high bend, narrow section, junction, and fly-over give kids ways to accelerate and keep the action going. Special LED lights light up the cars. Carrera Transformers lets kids guide their favorite character to high-speed victory. The 4.2-meter circuit offers two wellmatched opponents and a fly-over.
S-K Victory
S-K Victory will expand its Fairy Tale High line of fashion dolls this year. Fairy Tale High is a place where fairytale characters come together in a modern-day high school setting. Fairy Tale High is licensed from The Toon Studios of Beverly Hills. The new students who will walk the halls of Fairy Tale High this year include Teen Prince Charming; Teen Peter Pan; Teen Victoria, the Wicked Witch of the West; and Teen Pocahontas. All of the new dolls are fully articulated and stand 11.5 inches tall.
K’nex Gets Zombified
The Plants vs. Zombies Pirate Seas Plank Walk Building Set, from K’nex, allows kids ages 7 and up to defeat the zombies and save their brains on the Pirate Seas. The buildable replica of the Pirate Seas level in Plants vs. Zombies 2 includes special “rumble grid” action. Kids can turn on the battery-powered motor to make the zombies move down the rows toward the plants, just like in the game.
Teen Pocahontas
Winter 2014
The Licensing Book • 31
Spin Master Flies High with Disney, DreamWorks
Little girls ages 5 and up can bring the magic of Disney into their
homes with Spin Master’s Flying Tinker Bell. She flies guided by the palm of a child’s hand, and easily launches
from her display stand with the push of a button.
Flying Tinker Bell
DreamWorks Dragons Action Dragons Assortment brings
the action-packed dragons of Berk to life. Each 8- to 11-inch Action
Dragon has flapping wings and other action features, such as
Toothless’ spinning tail barrel roll, the Skrill’s lightning strike attack, and the Thunderdrum booming blast. Kids ages 4 and up
can combine the Action Dragons with 3-inch Viking figures.
Ionix, Spin Master’s line of shape-shifting construction bricks,
has expanded with the How to Train Your Dragon 2 Mini Battle
Ohio Art Goes Micro
Ohio Art has expanded its nanoblock line with Hello Kitty Sea Cruise. Kids can create 3-D works of art with these micro-sized building blocks. With more than 210 assorted pieces, kids can construct a Hello Kitty scene small enough to fit in their palms. Hello Kitty Travel Doodle Sketch includes a Doodle stylus, which makes drawing simple and fun for kids ages 3 and up. The go-anywhere handle makes carrying a breeze for onthe-go play. The Doodle eraser erases images in a flash, so kids can draw, erase, and start again as many times as they like.
32 • The Licensing Book
Evolution Packs available in Bulbasaur, Charmander, kids bring the pixilated video game to life. Vinyl
tances of more than 50 feet. Kids ages 4 and up
a real dragon.
with Pikachu, Ash, and more, as well as Pokémon
The Minecraft Vinyl Figure Assortment lets
can soar into the sky reaching heights and disdragon stunts as Toothless flaps his wings like
Pokémon Ionix collection includes a mini-figure assortment and Squirtle variations.
DreamWorks Dragons: Real Flying Toothless
can adjust his tail to unleash flying acrobatic
Playset, Deluxe Toothless Set, and Mini-Figure Assortment. The
figures include Steve with his pickaxe and grass
cube, Diamond Steve with his diamond helmet and sword, and
the Creeper vinyl with a diamond cube.
Spin Master has signed with NASCAR to produce NASCAR
Authentic Toys this year. The NASCAR Authentics 1:43 Diecast
Snap Kit includes all of the pieces kids need to create a race-
accurate model without using glue.
Disney Beat the Parents pits kids ages 6 and up against each
other and challenges them to prove who knows Disney best. In
Disney Fibber, kids ages 7 and up can’t get caught fibbing or their
noses will grow. The player with the shortest nose wins the game.
Ceaco Buzzes into Toy Fair
The Hive 24-Piece Puzzle, from Ceaco, features the characters from the kids’ TV show The Hive. The series focuses on “learning to bee,” and shows kids how to enjoy life and have fun while being mindful of each other and their surrounding world. With the Bee Family front and center, this brightly illustrated puzzle is designed for kids ages 3 and up.
Winter 2014
All Things Equal Asks: What Would You Do?
What Would You Do for a Klondike Bar?, from All Things Equal, challenges teens and adults to get creative, think quickly, and put their talents on display. In this game of minor skill and major will, players compete in creative, courageous, and cockamamie challenges while racing to collect all six Klondike bars. In the end, glory rests with the player who best answers the call, “What would you do for a Klondike Bar?”
Warner Bros. Celebrates Milestone Anniversaries
Warner Bros. Consumer Products (WBCP) will display a lineup of global licensees in support of the studio’s entertainment properties, milestone anniversaries, and upcoming theatrical debuts. The highly anticipated summer blockbuster Godzilla, from Warner Bros. Pictures and Legendary Pictures, leads the licensing lineup with support from master toy partner Bandai America Inc., among others. The Wizard of Oz, which leads WBCP’s milestone celebrations this year, will see licensing support from a number of cross-category partners. WBCP will also spotlight its DC Comics portfolio, including Batman and Superman, as well as Looney Tunes, The Hobbit, The Big Bang Theory, Harry Potter, and more.
Hedstrom Has a Ball with TMNT
Suitable for kids ages 3 and up, Hedstrom Entertainment’s Sculpted Teenage Mutant Ninja Turtle Balls can be tossed for fun and collected, and are made out of squishy sculpted foam.
Batter Up for Radz Brands
The new Radz MLB Collection, set to arrive this spring, features licensed Radz characters for all 30 Major League Baseball (MLB) teams. Each of these baseball-shaped dispensers has a team insignia on its hair and side, and can clip to a backpack or a belt loop. Each comes with a pack of gluten- and peanut-free candy.
St. Louis Cardinals MLB Radz
Winter 2014
The Licensing Book • 33
Exodus Film Readies Cra-Z Color City Line
Laser Pegs Teams Up with Nat Geo
Exodus Film Group will feature a new product line from Cra-Z-Art
The first Laser Pegs National Geographic Kits will feature
Color City. La Rose Industries/Cra-Z-Art will create crayons, sta-
Landmarks & Archaeology.
based on its upcoming crayon-themed animated movie, The Hero of
tionery, and toy
products—including activity kits— based on the film.
The Hero of Color
City is set for U.S. release from Magnolia Pictures.
themes such as Oceans, Animals, Dinosaurs, Space, and It’s possible to build six, 12,
24, or 30 different models, depending on which kit is
used. Kids will be able to explore their imaginations,
just as geologists and scientists have done over the
years with the marvels included in these kits.
Delta Offers Bedroom Furniture with Licensed Looks
The new Marvel 3-D Spider-Man Twin Bed, available in April from Delta Children, helps transition kids from crib to big kid bed. Constructed with a high-quality plastic and a metal frame, it is lightweight, yet provides safety and durability. The footboard features a 3-D Spider-Man. With the November launch of the Pixar Cars Toddler-to-Twin Bed, the brand will now offer bedroom furniture for kids ages 0 to 12. A new addition to Delta Children’s wood, plastic, and metal twin bed collections, it is designed to resemble the character Lightning McQueen. Offering authentic race car style with a steering wheel, a spoiler, working headlights, and built-in storage space under the hood, it converts from a toddler bed to a twin bed by switching out a crib mattress for a twin mattress. Once converted to a twin bed, the built-in storage becomes an oversized toy box, providing plenty of space for toys, blankets, or books. The new Teenage Mutant Ninja Turtles Toddler Bed also features a high-quality plastic and metal frame. The bed is built low to the ground to allow for easy child access, and comes with side rails for safe, secure sleeping. This year will also see the launch of Hello Kitty toddler beds, toy boxes, and multi-bins.
Disney 3-D Spider-Man Toddler-to-Twin Bed
34 • The Licensing Book
Pixar Cars Toddler-to-Twin Bed
Winter 2014
Want to Reach Millions of Consumers During the Holiday Season? • Holiday Gift Guide in the
November issue of Woman’s Day magazine, read by nearly 19 million* consumers (*MRI Fall 2013) AS SEEN IN
• Extensive Online Presence A comprehensive companion website, toyinsider.com, features links to participating advertisers’ and retailers’ websites and includes product reviews, demo videos, and guest blogger contributions.
• Widespread Media Coverage Laurie Schacht, the TOY INSIDER MOM, appeared in more than 200 National and Major Market TV segments, along with hundreds of print and online features.
• Participation in National Sweepstakes and Guerilla Marketing Programs to showcase participants’ products
To participate in the 9th Annual The Toy Insider™ contact: Jonathan Samet —(212) 575-4510 x 2321, jsamet@adventurepub.com Laurie Schacht — (212) 575-4510 x 2320, laurieschacht@aol.com www.toyinsider.com
Kids Can Cuddle Up with Jakks Pacific
Jakks Pacific will introduce the Good Night Daniel Tiger & Tigey plush. Dressed in Trolley pajamas,
Daniel uses encouraging phrases and the “Good Night” song to comfort kids ages 2 and up. Tigey
has a soothing glow. This plush can be set to lights only, or to play phrases and the song from the
show. Jakks will also feature the Ugga Mugga Daniel Tiger plush.
Dance with Me Clover hops, spins, flaps his ears, and wags his tail. When kids ages 3 and up
squeeze his hand, Clover teaches them his moves step-by-step in learning mode, and sings and dances
in dance mode. Clover comes with a magical lesson card to use with the Talking Magical Amulet. Jakks’ Sofia the First line also features the Talking Magical Amulet, the Color ‘n Play Activity Playland, and
role-play products.
Nintendo Wall Climbers, based on the Mario Kart 8 video game, can drive up the wall or other
smooth surfaces. These R/C vehicles have a vacuum suction feature to keep them adhered to the wall
as they move forward, backward, left, and right. Kids ages 8 and up can choose from Mario, Luigi, or Yoshi. The Nintendo line also includes figures and plush.
The new 14-inch Cabbage Patch Twinkle Toes, for kids ages 3 and up, wears Skechers Twinkle Toes
shoes that light up and sparkle when tapped—just like the real shoe line.
Good Night Daniel Tiger & Tigey plush
Pressman Toy Launches Licensed Board Games for Kids
The Diary of a Wimpy Kid 10-Second Challenge Game, from Pressman Toy, includes jumping, balancing, offbeat, unusual, and brainy challenges. If players ages 8 and up can complete the challenge in 10 seconds or less, they can out-wimp their friends and win the game. The game includes 90 game cards with original illustrations by the book series’ author, Jeff Kinney. How to Train Your Dragon 2 Sheep Launcher Game includes four dragon figures. Kids
ages 5 and up place the sheep on the catapult and fire. A player scores extra points for landing in his or her own basket, and the black sheep scores double points. Kids must move their
dragon figure along the outside path whenever they score.
The Bible game is based on the TV series and is designed for four or more players ages 10 and up. Players start by choosing to play Old or New Testament sections. During play,
trivia spaces ask players general and picture questions, using photo stills from the TV series. Activity spaces require players to do charades and draw objects and events from The Bible.
Special cards let players explore biblical passages further as a group, adding more texture
to the experience. The first team to travel around the game board wins. Goodnight, Goodnight, Construction Site Game and puzzles are based on the No. 1 New York Times best-seller.
After a day of doing construction, the hard-working vehicles have to rest up for another busy day. Pressman’s upcoming game and
puzzles tap into the excitement of building and moving for preschoolers.
36 • The Licensing Book
Winter 2014
Yomega Puts a Galactic Spin on Yo-Yos
Yomega Corp. puts the power of the Force in the hands of kids and yo-yo fans with a new collection of yo-yos based on the legendary Star Wars saga. Star Wars Yomega Yo-Men High Performance Yo-Yos and Action Stands provide kids and collectors with a way to play and display their yo-yos featuring Star Wars characters. Yomega Yo-Men come with a Star Wars Yomega Fireball yo-yo cradled in a highly detailed Yo-Men Action Stand sculpted in each character’s likeness. The yo-yos feature a bold character image and Yomega’s patented transaxle system, which allows for high speed and smooth spins. Yo-Men are available in Darth Vader, Clone Trooper, Yoda, and General Grievous, and are designed for kids ages 8 and up. Star Wars Yomega Fireball merges the Yomega Fireball yo-yo with Star Wars characters, including Darth Vader, Clone Trooper, Yoda, and Boba Yomega Yoda Yo-Men and Yo-Men Action Stand Fett. Star Wars Yomega Fireball yo-yos feature the patented transaxle system and are more than three times longer than an ordinary yo-yo. The yo-yos will feature character imagery and will include String Bling, a collectible ring molded in a Star Wars character’s likeness. The yo-yo string attaches to the String Bling ring for added comfort, while kids ages 8 and up perform classic and advanced yo-yo tricks. Yomega Elite Metals Glide: Star Wars Special Edition combines the competition-level Glide yo-yo with Star Wars characters and imagery, including Darth Vader, Stormtrooper, Boba Fett, and the Rebel Alliance and Imperial symbols. This showcase piece features laser etching that is perfect for collectors. The Yomega Glide is the first introduction in Yomega’s new Elite Metals collection. The Glide features a silicone pad return system and the Dif-e-Yo Yomega Darth Vader Yo-Men and Yo-Men KonKave bearing. Action Stand
Paper Punk Adds Nickelodeon Properties
Paper Punk’s paper-based construction toy line has expanded with Teenage Mutant Ninja Turtles kits. Each hero in a half shell will have its own all-inclusive kit containing 16 punch-n-fold shapes, more than 30 stickers, and 40 adhesive dots to construct a 9- by 3by 5-inch 3-D paper figure. The SpongeBob SquarePants kits will feature main characters SpongeBob and Patrick. Each kit contains everything kids need to make a free-standing figure for play and display. The SpongeBob SquarePants kit will include 16 punch-n-fold shapes, more than 150 stickers, and 40 adhesive dots to construct a paper figure standing 7 inches by 7 inches by 4 inches. The Patrick kit will include eight punch-n-fold shapes, more than 150 stickers, and 40 adhesive dots to create an 8- by 7- by 3-inch figure. Recommended for kids ages 6 and up, Paper Punk kits are designed to enhance creative thinking skills.
Winter 2014
Paper Punk Teenage Mutant Ninja Turtles kit
The Licensing Book • 37
Ripple Junction Gets Grumpy
Ripple Junction introduces Grumpy Cat as an 11-inch tall, officially licensed plush toy for kids ages 3 and up. Workaholics bobbleheads bobble their heads up and down for kids ages 12 and up. Workaholics Adam, Anders, and Blake bobbleheads bring their TV show personalities to life, are 7-inches tall, and are made of resin. Grumpy Cat plush
Marvel, Disney Have a Marvel-ous Year Planned
Marvel Entertainment and Disney Consumer Products will showcase product lines for some of Marvel’s classic franchises, along with this summer’s movie release Guardians of the Galaxy. Hasbro will expand its Super Hero Mashers line featuring iconic Marvel heroes. The toy company will also introduce toys for Marvel’s Guardians of the Galaxy, and continues to support The Avengers and Spider-Man franchises with new TV- and film-based offerings. Other Guardians of the Galaxy products include a new line from Lego, as well as FRS walkie-talkies, iHome headphones, and additional consumer products from KidDesigns. C-Preme will show off a line of cutting-edge, 3-D helmets and protective gear incorporating stylized designs based on Marvel’s superheroes, while Huffy debuts a line of bicycles, tricycles, scooters, and accessories based on the films Captain America: The Winter Soldier, The Amazing SpiderMan 2, and Guardians of the Galaxy.
Captain America: The Winter Soldier bicycle, from Huffy
38 • The Licensing Book
MasterPieces Lets Kids Piece It Together
MasterPieces Puzzle Co. has added the National Football League (NFL) to its 1,000-piece Panoramic Stadium Puzzles line. The line includes puzzles featuring 28 NFL teams designed for kids ages 13 and up. The puzzles measure 13 inches by 39 inches and make great collectibles for sports enthusiasts. NFL Rusherz are 100-piece puzzles for kids ages 5 and up. Each puzzle features artwork from the NFL Rush Zone TV show and measures 12.75 inches by 16.5 inches. The line includes all 32 NFL teams. MasterPieces’ Highlights for Children line expands with new kids’ puzzles, such as the Puzzlemania Activity Puzzle Pack, designed for kids ages 6 and up. Kids can store, sort, and save their puzzles with Elmer’sbranded products. Elmer’s Sort & Save includes six interlocking puzzle-shaped stackable trays that kids can use to sort their puzzle pieces. With the Elmer’s Roll & Stow, kids can save their puzzle for later without ruining their progress. Made with high-quality acrylic felt and non-slip footpads, the Elmer’s Roll & Stow will always stay in place. Elmer’s Puzzle Glue uses a patented Elmer’s Spreader Cap, spreading glue with less mess and more speed so kids can save their finished puzzles.
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F
by Laurie Schacht, Toy Insider Mom, founder, Blogger Bash or the past four years, The Big Toy Book’s Sweet Suite event has been the go-to event for bloggers looking to connect with the top toy companies. During Sweet Suite, each toy company gets a designated play area where it can share its latest products with the top bloggers nationwide. The bloggers get to directly interact with company representatives face-toface, while also getting hands-on experience with amazing new products in advance of the holiday season. With hundreds of bloggers attending the event and a growing wait list year after year, we will expand this year’s Sweet Suite into a two-day conference called Blogger Bash. Parent bloggers have become some of the most influential voices when it comes to promoting toy brands and new products. Over the past five to seven years, we’ve seen influential leaders emerge in this space, garnering thousands of followers and creating complete online communities. These women (and often men) are far beyond the basics of blogging, and Blogger Bash will provide them with the next tier of their professional development. With events, parties, round
Winter 2014
table forums, speed dating sessions with brand representatives, and, of course, lots of swag to enjoy and review, Blogger Bash will give bloggers everything they need to establish new connections with leading manufacturers. Held in New York City on July 16 and 17, this event will draw hundreds of bloggers nationwide. The conference will kick-off on Thursday evening with Sweet Suite, where bloggers will play with new toys, indulge in sweet treats, and leave with tons of swag. From a brand standpoint, why is Blogger Bash for you? Because social media matters, and these bloggers have a lot of influence on Facebook, Twitter, Pinterest, and more. The power lies with the consumers—and that’s exactly what these bloggers are. Sweet Suite generates millions of impressions annually, and bloggers talk about all of the great things they saw well into the holiday season—prime time for manufacturers. If you are interested in learning more about Sweet Suite ’14 and the new upcoming Blogger Bash event, please contact me at thetoyinsidermom@gmail.com or (212) 575-4510. ••••
The Licensing Book • 39
New Uglydoll Line Rocks Out with Kiss
Ice-Bat Batman plush
Pretty Ugly LLC and the Kiss band members have teamed up to present the Uglydoll Kiss 11-inch and clip-on plush dolls. These plush collectibles are available in Ox Demon, Wage Spaceman, Babo Catman, and Big Toe Starchild. The 11-inch plush dolls are suitable for kids ages 1 and up, while the clip-on plush is designed for kids ages 3 and up. Uglydoll has also partnered with DC Superheroes for 11-inch and clip-on plush dolls. This year, Uglydoll will release the second phase of its twist on the iconic DC Superheroes with Ice-Bat Batman in pink and purple, Wedgehead Robin, and Tray Wonder Woman. The 11-inch plush dolls are suitable for kids ages 1 and up, while the clip-on plush is designed for kids ages 3 and up. Funko will also produce Uglydoll DC Comics Vinyl Figures, which measure approximately 4.5 inches to 5 inches in height. These figures love justice and snacks, and will be available in IceBat as Batman, Wedgehead as Robin, and Babo as Superman. The vinyl figures are designed for kids and collectors ages 14 and up.
DHX/Imports Dragon’s Caillou Says Bonjour DHX Media will feature a new Caillou Talking Doll, from Imports Dragon, based on the children’s TV show character who appears regularly on PBS Kids and Sprout. Kids can press Talking Caillou’s belly to hear him say, “Hello,” “Bonjour,” and other friendly phrases. The Caillou Talking Doll is suitable for kids ages 3 and up, measures 15 inches tall, and is dressed in his familiar school uniform and matching backpack.
Tech 4 Kids Is Gonna Rumble
WWE Rumble Fists and Spar Bags, from Tech 4 Kids, get kids ages 4 and up ready to rumble with oversized soft play fists featuring John Cena, Dolph Ziggler, and the Rock. Each set comes with motion-activated sound effects for realistic action. Kids can prepare for the fight with the Spar Bag, which comes with a full-size John Cena graphic and a water-filled base. My Little Pony Lite Friends are soft, squishy pony friends that glow to help kids ages 3 and up fall asleep. Lite Friends are available in a variety of licenses, including Transformers, Teenage Mutant Ninja Turtles, Spider-Man, and Hello Kitty. Transformers Action Lites are light-up action figures that help make kids feel safe at night. Tech 4 Kids will introduce Fash’Ems for kids ages 4 and up. Fash’Ems are soft, squishy, fashionable figures for girls who like to dress up and play with their favorite characters, such as My Little Pony and Hello Kitty. Style Packs include a Fash’ems character and two fashion accessories. My Little Pony Fash’Ems
40 • The Licensing Book
Winter 2014
New Licensees Usher in Age of Discovery
Discovery Communications will debut new products for its TLC, Animal
Planet, and Discovery Channel brands.
The licensing line inspired by the TLC show Cake Boss is expanding
into the kids’ space. TLC will actively look for new licensees at Toy Fair.
Wooky Has Sketchbooks with Sweet Rides
Wooky Entertainment will add to its Design Masters
line, aimed at kids ages 7 and up. The Micro Charged
Sketchbook To-Go is a new line of travel-ready sketch-
books for the Lamborghini Aventador LP 700-4 and
Discovery Consumer Products will seek additional partners for its
Ford GT, each featuring stencils, illustrated inspiration
ing and construction sets, and more. Current licensee Bendon Publishing
The Backlit Tracing Studio helps auto enthusiasts
Animal Planet brand in categories including plush, arts and crafts, build-
sheets, an official graphite pencil, and stickers.
will feature Animal Planet color and activity books.
create their dream rides. Available in Ford Backlit Trac-
ery Channel series Gold Rush. The kit gives individuals the experience of
both kits illuminate car details to enable artists to trace
Pay Dirt will debut the Gold Rush Panning Kit based on the Discov-
panning for gold from the comfort of their homes. It includes a bag of au-
thentic pay dirt guaranteed to
ing Studio and Lamborghini Backlit Tracing Studio,
and then personalize their vehicles.
contain gold, a professional
gold pan, a snuffer bottle, a vial, and a certificate of authenticity.
Discovery Consumer Prod-
ucts also seeks strategic licen-
sing partners for arts and crafts,
building sets, seasonal toys, and other categories.
Bachmann Gets Going with New Chuggington Sets
Based on the Chuggington TV series, Bachmann introduces two HOscale Chuggington electric train sets. Wilson’s Freight Adventures features a Wilson locomotive with an operating headlight, a lowsided gondola, and a box car. Brewster’s Cargo Caper features a Brewster locomotive with operating headlights and two colorful hopper cars. Both ready-to-run sets include a 36-inch circle of snapfit E-Z Track, a power pack, a speed controller, and an illustrated instruction manual. Separate-sale locomotives and rolling stock are also available.
Winter 2014
The Licensing Book • 41
World of L icensing
The
by Scarlett Wisotzki, editor in chief, das Spielzeug; German member, International Toy Magazine Association
B
e it from a blockbuster movie, TV show, app, or an original brand, manufacturers like to adapt and capitalize on successful characters for kids. Despite regional differences, the major themes seem to work well across international borders. We have been keeping our ears close to the ground for both current and emerging themes. Last year, it was family feature films with established characters that inspired toy makers to create new licensed products in a host of different areas. Launching a diversity of action figures, cuddly toys, games, and models, they gave kids the opportunity to immerse themselves in the world of
Marvel characters from the Disney portfolio capture the imagination on screen whilst generating toy sales around the world.
42 • The Licensing Book
“The global potential of the licensing business is very promising. Experts expect this year to be the strongest year in recent history for toys tied to movies.” films such as Iron Man 3, Monsters University, Despicable Me 2, and Planes. “Planes is also growing in Sweden,” says Lena Hedö, editor in chief of Swedish toy magazine Leksaks Revyn. “In addition, Hasbro’s My Little Pony is experiencing a comeback.” She also points out that the licensing market also has other avenues, as steady local heroes such as Pippi Longstocking show. Similarly, the key European markets all seem to have their own characters, such as Horrid Henry in the UK, Die Maus in Germany, and Titeuf in France. “Licensed toys account for about 25 percent of
Winter 2014
Besides global themes, each country has its own licensing stars. For example, the animal characters from Dezico in China.
the overall toy market in Poland,” says Anna Wakulak, editor in chief of Polish trade magazine Swiat Zabawek. Successful trends there include app stars Angry Birds, Mattel’s Monster High, the newly styled Minnie Mouse, and Star Wars.
The global potential of the licensing business is very promising. Experts expect this year to be the strongest year in recent history for toys tied to movies. “[This year], we think Teenage Mutant Ninja Turtles will be strong, and maybe the first Lego movie as well,” says Hedö. The latter is a 3-D animated adventure based on a story centered around the Lego construction sets, featuring popular and new figures. To mark the occasion, Lego will launch a line of its own, which will be complemented by a diverse range of products from licensees worldwide. Sequels to successful films will equally define the business in the near future. Accordingly, The Amazing Spider-Man 2, Jurassic Park 4, Transformers 4, and the last part of the The Hobbit trilogy will soon appear on cinema screens. In 2015, cinema-goers will meet old friends Charlie Brown and Snoopy, as announced in October by Peanuts Worldwide. This will be preceded by 500 completely newly animated short stories based on the comics and characters created by Charles M. Schulz. The new collection will be available for global distribution this fall. ••••
Disney Tops the List
Star Wars remains a best-seller. It ranked second in the 2012 top 10 of the most successful merchandising themes in the American and Canadian licensing market, generating U.S. $1.47 billion in sales, second only to Disney Princess and ahead of Sanrio’s Hello Kitty. Having acquired Lucasfilm, Pixar, and Marvel, there is no doubt that Disney leads the field in this sector. The heroes of the American corporation are also high in the popularity stakes in Asia, alongside established local characters. The cartoon series Boonie Bears and Dezico, for example, appeal to younger kids in China. Armor Hero, on the other hand, offers plenty of action for boys, whereas Balala the Fairies targets girls.
Winter 2014
Lego construction sets and a diverse selection of licenses will coincide with the release of The Lego Movie.
The Licensing Book • 43
Property Profile
Bringing
D OWNTON A BB EY to life
Downton Trivia
The cast of the fourth season of Downton Abbey
✥ Downton Abbey, produced by Carnival Films, part of NBCUniversal International Television Production, airs in more than 200 territories around the globe, making it one of the most widely watched television drama shows in the world. ✥ Downton Abbey’s wordless opening theme song’s title is "Did I Make the Most of Loving You?" ✥ The third season finale of Downton Abbey (February 17, 2013) was watched by 12.3 million U.S. viewers, surpassing everything else on broadcast and cable TV as that night’s top-rated show. ✥ The Downton Abbey production team includes Alastair Bruce, an expert on state and court ritual, as historical adviser. ✥ Rose grower Weeks Roses has bred a new grandiflora rose variety named “Anna’s Promise” (patent name ‘Rosa WEKdoofat’), inspired by the Downton Abbey TV series. It is a beautiful, strong-stemmed, and large-flowered rose with a sweet and spicy, fruity fragrance. ✥ The premiere episode of Downton Abbey’s fourth season (January 5, 2014) was the most-watched drama debut in PBS history.
HERITAGE LACE
The new Downton Abbey collection captures the color, texture, and tactile appeal of fine laces, sheers, linens, velvets, burlap, natural wovens, and embroideries that would be right at home (upstairs and downstairs) at Downton Abbey, while also fitting modern tastes and sensibilities.
44 • The Licensing Book
KURT S. ADLER
Fans can enjoy the elegance and grandeur of Downton Abbey with holiday ornaments from Kurt S. Adler.
Winter 2014
THE REPUBLIC OF TEA
From Lady Violet Crawley to Lord Grantham, The Republic of Tea’s Downton Abbey Inspired Tea Collection captures the essence of the TV show’s beloved characters. English Rose and Grantham Breakfast Blend are available at republicoftea.com. Downton Estate is available exclusively at Cost Plus World Market.
WINES THAT ROCK
The Downton Abbey Wine Collection, from Wines That Rock, is crafted with premium grapes from France’s famed Entre-Deux-Mers region—the same vines, soil, and region used to produce wines from the Downton era. Fifthgeneration winemaker Jean-Marc Dulong has created a collection of finely balanced, elegant wines that are eminently drinkable. These wines are available at downtonabbeywine.com.
FIFTH SUN
Fifth Sun has released its spring 2014 line of Downton Abbey apparel for juniors and young men, which features sublimation print and screen tees on fashion Tshirts featuring the cast and classic quotes. Trend right designs are currently available at Hot Topic and Kohl’s. The shirts are also available at www.fifthsun.com.
Winter 2014
1928 JEWELRY CO.
The Downton Abbey Jewellery Collection, from 1928 Jewelry Co., captures the look and feel of the jewelry seen on the TV drama in a licensed line of contemporary jewelry that carries vintage flair. The spring 2014 collection is available at retailers including www.1928.com, Macy’s, and Amazon, among others.
RUNNING PRESS
The grand home of Downton Abbey comes to desktops everywhere with this collectible mini kit, from Running Press. A miniature replica of the iconic manor house with a unique lightup feature and the Downton Abbey theme song, as well as a 48page book with favorite quotes and images from the show is included. This kit will be on sale everywhere in March.
The Licensing Book • 45
THE
Top Two Reasons WHY MORE RETAILERS ARE
Multi-Testing
B
by Carol Spieckerman, president, newmarketbuilders
ack when stores were their central showcases and risk resided on the shelf, retailers prized security over speculation. If a buyer decided to carve out space for an untried brand or product, something safe had to be supplanted. It’s no wonder that even tests that were run in limited numbers of stores were fraught with tension for both buyers and suppliers. Now, the make-or-break constraints of the past are lifting as retailers dive into the deluge of digital and material options available to them. The days of trying one thing at a time are quickly fading, and a new era of rampant experimentation is dawning. Here are the top two reasons why retailers are pulling the trigger on many trials at the same time, and how this translates into opportunities for brand marketers who are ready to click into multi-testing mode.
1. Platforms ease the pressure.
Retailers are no longer just boxes that sell stuff. They’ve quickly evolved into platforms that pull together websites, mobile apps, new store formats, service ventures, partnerships, technology acquisitions, and more. Retailers’ newly expanded ecosystems give them more places to move, and also offer much more forgiving environments for experimentation. Even though product sales are still a major contributor to their bottom lines, ancillary busi-
46 • The Licensing Book
nesses, such as financial services, telcom, fuel, and digital entertainment, are propping up the platforms of many retailers, including Walmart, Tesco, and Carrefour. Of the three, Walmart stands out as being particularly aggressive in the multi-testing department. Shopycat, Polaris, Get on the Shelf, and Goodies are just a few of the significant technology innovations and campaigns that have been developed and launched in the two years since Walmart’s innovation incubator, @walmartlabs, was established. In the last couple of months, predictive analytics startup Inkiru was added to Walmart’s brain trust in the wake of its acquisitions of two Bay Area start-ups, One Ops and Tasty Labs. Walmart has also concurrently embarked on several other major initiatives, including the opening of additional Walmart on Campus stores, the accelerated rollout of its Neighborhood Market and Walmart Express formats, and the launch of e-commerce delivery lockers in select Walmart locations. This comes in addition to multiple mobile shopping app launches, ongoing entertainment exclusives, cloud-based media advancements, and consumer financial solutions, such as its Bluebird partnership with American Express. Walmart’s cornucopia of kick-offs forms a synergistically supportive structure, one that ensures that no single program will have to carry all of the weight. Marks & Spencer, Target, Home Depot, Staples,
Winter 2014
and Tesco are among the retailers that have followed Walmart’s example by setting up technology-focused innovation labs. Clearly, the global torrent of retail trials will only accelerate across multiple tiers and categories in the months and years to come. Brand marketers that take the time to learn about the growing number of supplementary initiatives that retailers are taking on, and those that draw meaningful connections to them, will be ahead of the focus-onthe-obvious crowd. Also, in this highly experimental environment, “sell and wait” is a relic of the past, and live testing is replacing private refinement. Licensees and licensors that are ready to launch multiple brand and product scenarios, and correct their courses throughout each program, will be able to keep pace with retailers.
2. Digital is exponential (and millennial).
Retailers such as Debenhams, Walgreens, and Macy’s have been running a variety of in-store experiments in flagship locations, rather than deploying them chain-wide and waiting to see what happens. Doing so allows these retailers to test all kinds of product, brand, and service ideas in locations that enjoy high traffic and diverse customer bases without risking multi-store mishaps. By contrast, most retailers have mainly dabbled in digital tests, primarily through selective launches of online brand previews and exclusives. Target’s campaign for the critical back-to-college season demonstrates how much that is changing. In July, it launched a full-on, multi-initiative digital assault, including its Bullseye University Digital Experience, which featured live streaming of popular YouTube personalities in a life-size “dorm” that was created on a studio set in Los Angeles. Visitors to the dedicated website could shop Target products from the dorm rooms, enter to win college gear, and interact with the roommates through social media. Target also brought back its uStyler online tool, launched last year, which allows students to design and outfit virtual dorm
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rooms and share their creations through social media. Meanwhile, its Checklist tool allows students to organize and personalize their shopping lists, while providing targeted recommendations. Student’s lists can be printed at home or at any Target registry kiosk and shared via Facebook. Digital-forward tactics are a spot-on approach to attracting millennial shoppers during important shopping seasons, and they allow retailers to adjust program elements on the fly and integrate successful aspects into future ventures. Enlisting digital-savvy celebrities with significant fan followings and encouraging social media sharing amplifies the overall impact. Going forward, store-centric strategies will take a back seat, as multi-pronged digital campaigns gain traction, and particularly as more retailers set their sights on wooing millennial shoppers. Smart licensees and licensors with direct-to-retail programs will forge relationships with retailers’ digital market teams and build strategies that transcend store counts and merchandising maneuvers. When it comes to celebrity partnership decisions, social media standing and digital acumen will carry as much or more weight than universal name recognition and traditional media popularity. As more retailers exercise their multi-testing options, brand marketers that jump in with them will tap into opportunities that surpass the shelf. •••• Carol Spieckerman, president of newmarketbuilders, is a retail speaker, writer, and strategist. She ties together emerging developments that are shaping the future of retail across tiers, categories, business models, and borders. To learn more about how multi-testing and other retail dynamics impact your future retail strategies, visit Carol’s blog at www.nmbblog.com, follow her on Twitter @retailxpert, or call her directly at (479) 586-7491.
The Licensing Book • 47
International
Licensing in India Distribution First, Brand Second
I
By Sid Shah, president, The Wild East Group
ndia is as interesting as it is complex in both culture and in business. Because India has traditionally been a trading and export hub, the domestic retail market gave rise to a very complex, multi-layered distribution system that varies from state to state. Licensing in its various forms has been a growing practice for about 10 years, with character licensing having the strongest foothold. Companies such as Viacom, Disney, and Mattel have invested heavily in building their distribution and retail network and are starting to see the returns on that investment. On the other hand, licensing for lifestyle, corporate, and celebrity brands is very new and beginning to gain momentum in India. Most organized retailers or department stores that are pan-India are glorified real estate agents, and rent space takes a percentage of margin and rarely holds inventory. Ninety percent of the market is still in the unorganized space, which is largely governed by the distribution model and multi-brand outlets (MBOs), which also present the largest opportunity. The biggest challenge in India is compliance and payments, as it is almost guaranteed that the brand will only receive the minimum negotiated guarantee. The biggest challenge for brands from a compliance perspective is what happens after the product leaves the licensee and goes into the magical black box of distribution. Cash payments, multi-layered margins, and sales or returns are just part of the compliance nightmare. Once companies get deep in the weeds in the distribution layer, they can really understand how the process works and where the real opportunity is. Simultaneously, the most ardent argument a licensor will hear in India is, “Why should I invest in your
48 • The Licensing Book
brand when I can just create my own?” The argument that brand awareness can increase shelf space and consumer demand is often dismissed in favor of higher margins. Additionally, the value of a brand is still something people don’t completely rally around. At the end of the day in this growing brand-conscious market, consumers are looking for brands that they have heard of and trust; however, it is the distributors and unorganized retailers that favor margins and push products where they can maximize their revenue, which leaves a gap. Considering those challenges, how does one still give the consumer what they want, and work with the multilayer distribution system? One model is to convince brand owners to forego the licensing model and go straight into the distribution model via their licensing agency. Manufacture the product, sell to distributors with healthy margins, and push the product with little (or no) marketing. This is a new model we recommend to some of our clients, typically for commodity products such as innerwear, grooming, and hygiene products that might follow their category leaders, such as apparel. It is all about getting the product into the market for categories that can succeed off of margins alone. With 1.2 billion people, the potential in India is huge, but brands have to look at the big picture and be flexible on different models in order to crack this market. •••• Sid Shah is president of The Wild East Group, a business development and brand extension agency focused on celebrity, lifestyle, and corporate brands in India. Its clients include Hrithik Roshan, Playboy, Times of India, Miss India, Paul Frank, Yash Raj Films, and the Kolkata Knight Riders.
Winter 2014
Licensing Administration
How to Minimize Risk: The Selection Process Part One in a Series
A
By Amos Biegun, CEO of Counterpoint Systems
s a provider of rights management and royalty processing systems to the industry, we are often asked for our thoughts on how to implement complex software with minimal risk. Having implemented systems for more than 26 years, we have seen our fair share of projects and learned how to avoid pitfalls and leverage resources, thus bringing about successful implementations. That being said, there are a number of risks associated with implementations of all sizes and complexities that must be weighed carefully before embarking on a system replacement, upgrade, or new initiative. There are risks associated with every decision made in business. For those in the licensing industry, risks are faced every day with every brand and product released into the market. Knowing whether consumers will become loyal to brands and buy the products associated with them is something that isn’t easily predicted and requires its own degree of risk management. Still, there are more and more brands getting into the licensing business with great aspirations for brand awareness, loyalty, and the rewards of large profits. Risk has always been a part of the licensing business. Software decisions can be equally risky, as an organization can become stretched during an imple-
mentation as it assembles the right teams to implement new solutions while keeping the business working to its full potential. That’s why making decisions in this field are some of the most difficult, as options can become confusing and benefits can become blurred. Learning how to mitigate risk by doing your homework and researching the many options available to you takes time and careful analysis. So, how do technical decisions that require significant resources get made? How do we stop long enough to ask the right questions of the right partners so that we obtain all of the benefits presented while keeping our risk to a minimum? How do we invest in tools that will help us manage and grow our business rather than drain our resources without clear or measurable benefits? As the CEO of a software company that supports more than 400 clients across more than 25 countries, I can tell you from experience that the first and most important step you should take is to identify the business problem you’re hoping to solve by implementing an upgrade or new software solution. Begin at the end. Ask yourself what a successful implementation looks like in your organization and what the measurable benefits are. Weigh that up against the investment you are willing to make versus the costs of keeping things at the status quo, remembering always
“... the first and most
important step you should take is to identify the business problem you’re hoping to solve by implementing an upgrade or new software solution. Begin at the end.”
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that there are internal “soft costs” that are difficult to measure. Lastly, look for a partner in your software vendor. Any enterprise level implementation will have challenges and will require a partnership to navigate through the issues that arise. Both parties need to have an investment in the project. In my experience, there are three distinct types of customers I’ve come across: those who have a system in place but are unhappy with the limited functionality and/or outdated technology; those who have taken other standard office tools and tried to make them work in a way they were not intended to easily or effectively; and those who don’t currently have any system and are faced with the challenges of generating reports or auditing data without any tools with which to work. Each is unique in what drives them to seek solutions, yet all share the same desired destination: to endure the least amount of risk in order to realize the greatest reward. Finding and sourcing technology partners to mitigate risk is not an easy task. There is a wide range of options available, each with its own benefits, however I suggest you start by asking your software vendor or their representative the following questions: How much experience do they have with your industry and companies like yours; how knowledgeable is their team on specific issues facing your business? Do they have a team that works in your industry? Implementing software requires one skill set, understanding your business is a totally different matter. Make sure they fully understand your business requirements. Depth of experience in the licensing industry is critical to helping guide you through the many decisions that will need to be made during your implementation. What’s their track record, how many successful implementations have they have managed? Experience is everything in the software business, everyone makes mistakes and over time you learn how to eliminate
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those. Make sure your vendor isn’t having those earlyday experiences at your expense. How financially secure is your vendor’s business? Will it have the financial resources to ensure a supportive and long lasting relationship with you? Will they be around in five or 10 years? Relationships are tested during tough times and your vendor will have to “dig deep” if your project does not proceed well. Ensure your vendor has the resources to handle this. Is the proposed solution configurable or is everything hard coded and not adaptable to changing business needs or market conditions? It is hard to imagine that the business will be constrained because certain data parameters (rates, territories, or channels, for example) are not user-definable but require programmers to add or amend such data elements. Ask the question—you might be surprised by some of the answers. How up to date are they on changes and trends in the industry; have they made allowances for new and emerging distribution methods? The markets are changing all the time—you don’t want to be the one footing the entire bill for updates to the software that are necessitated by new market standards or conditions. Answering these five basic questions will go a long way toward qualifying a technology partner. Look for my next installment, “How to Minimize Risk: Implementing Software and Maximizing Benefits,” to learn the best way to manage a successful implementation. •••• Amos Biegun is the CEO of Counterpoint Systems, a provider of rights and royalties software for the media and entertainment, brand licensing, and music industries. For more information, visit: www.counterp.com.
The Licensing Book • 51
S urtex urtex
Art and Design
In its 28th annual show, SURTEX will feature the world’s top artists, designers, studios, and agencies all under one roof at the Jacob K. Javits Convention Center in New York City from May 18 to 20. ore than 300 exhibitors will convene to license and/or sell original artwork and designs for a broad spectrum of markets, including textiles, wall coverings, floor coverings, tabletop, giftware, stationery, greeting cards, gift wrap and other paper products, toys, ceramics, packaging, and publishing. SURTEX is an international marketplace, with 25 percent of exhibitors hailing from more than a dozen countries, including the UK, France, Italy, the Netherlands, Canada, Brazil, Mexico, Japan, and Thailand. The remaining 75 percent come from all across the U.S. This convergence of art and design talent is expected to draw more than 6,000 attendees—comprised of manufacturers from consumer, institutional, and contract
M
SURTEX show floor
52 • The Licensing Book
markets, as well as retailers—all seeking the latest creative surface designs and artwork for their product development needs. SURTEX is categorized into three main areas to meet the distinct needs of its attendees. With nearly 70 percent of exhibitors primarily licensing their art, images, and brands, the main focus will be on licensing studios and agencies offering the works of more than 1,000 individual artists. Longtime returning licensing exhibitors include Courtney Davis, Debbie Mumm, Giordano Studios, Kate Mawdsley, Lilla Rogers, Linda McDonald, Studio Voltaire, Sue Zipkin, Suzanne Cruise Creative Services, and Wild Apple Licensing. SURTEX will also welcome key brands for the first time, including V&A Licensing (Victoria & Albert Museum), Kathy Davis Studio, and other design studios. Exhibitors selling their designs (prints, patterns, repeats, and documents) will be easily identified under the second area under the umbrella Atelier, a section of the show highlighting textile design studios with cutting-edge, trend-forward designs. The third area is ReSource Hub, devoted to providing design business solutions and resources for attendees and exhibitors. Here, designers will find the latest in software (i.e., design management), printing technology, trend services, and many books, publications, and other design inspirations, as well as the Trend Theatre featuring the world’s top trend forecasters. The SURTEX Conference Program is considered the
Winter 2014
leading source for business information and trends impacting the art and design industry. This year’s Conference Program, titled Distinct Business Strategies from a Creative Perspective: Intelligence for Manufacturers, Designers and Retailers, will comprise of 12 90minute sessions organized into three distinct tracks. Market participants—from newcomers to veterans— will have the opportunity to learn the fundamentals, enhance their skills, and get information on relevant business topics from seasoned industry gurus. The first track, Basics: Monetizing Your Creativity, comprised of four sessions, is for artists and designers interested in creating a business out of their talent and skills. Topics include the basics of art licensing, how selling outright works, the ins and outs of engaging an agent, and an in-depth view of the licensing contract. The second track, Deep Dive: Legal and Product Intel, focuses on specific product categories: Textile & Home Fashion, Paper & Stationery, and Tabletop, Gift, & Home Décor. This track presents perspectives from manufacturers seeking artwork for these products and will cover copyrights and protection of artwork. The third track, High Level: Strategies for Business Growth, will be of interest to a broad audience. Focusing on business growth, the three sessions will address different strategies for manufacturers, retailers, and designers, including keys to successful branding, using global trends effectively, and expansion outside of the U.S. Registration for these courses is available by track, full conference package, or by individual sessions through www.surtex.com. Exhibitors are offered two complimentary sessions. The International Student Design Competition, designext, will present this year’s theme of Street Inspiration. The specific challenge will be for students to create a collection of surface designs inspired by what they think will be “street influences” in the year 2020. A panel of industry members will select four winners who will be invited to attend SURTEX, where final judging will take place and a grand prize winner will be chosen. SURTEX continually strives to enhance the experience of all show participants, and has a number of preshow and on-site amenities that create a more
Winter 2014
productive, enjoyable business environment. Pre-show benefits include a website for pre-show planning, educational webinars, and a semi-monthly enewsletter filled Wild Apple Licensing at SURTEX with industry and show news. On-site amenities include private on-floor meeting rooms and early morning VIP hours for exhibitors to meet with key customers, a convenient onfloor café with streaming SURTEX news, complimentary ongoing trend presentations in the Trend Theatre, networking/social events such as an exhibitor happy hour, and an industry-wide Cruise on the Hudson chartered yacht party for both exhibitors and attendees. Travel-related amenities include discounted New York metro hotel rates and complimentary shuttle buses between designated hotels and the convention center. SURTEX is essential for the growth and success of exhibitors, such as Wild Apple Licensing. “As the only international licensing show dedicated specifically to art licensing, we know our top licensing partners and leading retailers also plan to attend this show,” says Kat Gray, director of licensing at Wild Apple Licensing. “For 2014, we look forward to re-connecting with our fellow licensors, finding new talent, and, of course, planning many productive design meetings with key manufacturers.” Penny Sikalis, GLM vice president and SURTEX show manager, says, “SURTEX is where art and design professionals convene to examine, license, and buy the world’s best and most original surface design. It’s where vital relationships are started and built upon—producing new licensing deals For further information, visit and contracts throughout the year.“ www.surtex.com or contact GLM SURTEX will co-locate with the Customer Relations at International Contemporary Furnicustomerrelations@glmshows.com ture Fair and signature mix marketor (914) 421-3329. place, comprised of the National Stationery Show, Creative & Lifestyle Arts, and Gift>it. ••••
The Licensing Book • 53
Of Counsel
Minimum Royalty Guarantee:
The learning curve Licensing 101, Part 71 by James Kipling, Of Counsel
This article is the 71st in a series devoted to the documentation of the licensing relationship and elements of a typical license agreement.
L
et’s pretend that you have negotiated with a major motion picture studio for the use of the storyline and principal characters of an upcoming theatrical motion picture in your product line. The characters, the storyline, and the entire concept are fresh and new. The property has no prior track record, but you are convinced that it will fit perfectly within your product line and should provide substantial incremental sales for the next two or three years following the movie release. You are new to licensing, but you feel this is a “sure thing.”
Doing the Deal
The negotiations go well and you sign a deal memo for a three-year term at a 10 percent royalty rate across several product categories. You and the licensor’s account executive finally agree on a minimum royalty guarantee of $300,000. In fact, the guarantee was the most heavily negotiated part of the deal, and you’re well aware that new properties lacking pre-sold recognition are the most risky, so you bargained hard. Nevertheless, you feel confident that, with the initial buzz you have been
54 • The Licensing Book
hearing about the picture, you can cover most of the guarantee during the period of the initial theatrical release and the DVD release scheduled six months later. When the full agreement comes in, you check over the sections stating the major “business points” very carefully. You notice that the $300,000 minimum is broken up into equal portions payable by the end of each of the three calendar years of your term. An advance payment of $50,000 is due upon signing and is recoupable against the first royalties generated by the sales of your products. The rest of the first year’s $100,000 guarantee payment is due December 31 of the initial year, and the other two equal increments are due on December 31 of the second and third years. (It makes sense that the licensor wants certainty in the cash flow. Even if the property takes off slowly, you’ll catch up in due time.) The royalty rate is correct. The “standard terms” are just legalese, so you sign the documents and return them to the licensor along with your advance check. When your fully signed copy is returned, you put it in your file and get busy designing, developing, manufacturing, and selling your product line. Initial retail shipments precede the movie release date, your line looks great on the shelves, and the movie buzz escalates.
Winter 2014
Year 1: Box Office Hit
Having picked a late spring weekend without a major competing movie release, the studio from which the property was licensed reports excellent results, and retail movement of your first licensed product line is extraordinary. As a result, re-orders pour in and your factory turns out as much product as you’re comfortable ordering. The product stays hot through the summer, and by fall you have generated royalties well in excess of the first year’s guarantee. By year-end, you have paid the studio nearly $250,000. Your initial foray into licensing has proven fruitful, and profits are up greatly under the license. You have no doubt that you will be able to cover the last $50,000 of the royalty guarantee, no matter what happens over the next two years. Life is good.
Year 2: Slowing Sales
After Christmas, sales of your products slow down, so you cut back your manufacturing projections. By June of the second year of the license term, you receive cancellations from your retailers as the retail movement of the products dries up. Looking back at your P&L on the line, you show a significant profit and have no regrets. Current sales will easily cover the remaining $50,000 of your minimum guarantee and, in fact, when the fourth-quarter royalty payment is sent to the licensor, your total $300,000 minimum has been covered. You take a deep sigh of relief. You’re a success in the licensing business.
Year 3: End Game
Shortly after the second Christmas of your license term, your sales staff reports that it is unlikely that there will be significant additional sales of the licensed product line for the upcoming year. Whatever spotty placements may be maintained will only serve to deplete your residual inventory. This prediction turns out to be accurate, and total sales in year three generate only $25,000 in royalties. Never-
Winter 2014
theless, your overall experience as a neophyte licensee has proven very successful and you have cleared a tidy profit with your product line. Life is very good.
The Shell Game
Shortly after submission of your fourth quarter royalty payment for the final year of your license agreement, you receive a letter from your licensor. The content of the envelope gives you a shock. The letter is addressed to you from the studio’s finance department, rather than from the account executive with whom you have had all prior communication. The letter states that a “full statement of your account” is enclosed—it shows that you have paid $250,000, $50,000, and $25,000 for the last three years, a total of $325,000. Of course, you knew that. However, as you continue reading the account, your certainty turns to incredulity—and then to anger. The letter goes on to say that you are in default of payments of the minimums for the second and third years of your license agreement, each of which had a $100,000 minimum royalty guarantee. Wait a minute! Your deal was one guarantee of $300,000—where do they get three guarantees? Reading further, they say that your failure to make timely payment leaves you deficient by $125,000 plus interest—leading to the closing lines: “Amount Payable: $135,518. Kindly remit within five business days of instant date.” As soon as you have regained coherence, you call the account executive at the studio and demand an explanation. She tries to refer you to the finance director, but you insist that she stay on the line and that they both explain to you how you can possibly owe anything at all when you generated and paid the
The Licensing Book • 55
Signed Deal Memo Guarantee(s): Period: January 1, 2014-December 31, 2016 Amount: $300,000 Payable: $30,000 upon Licensee’s signing of the License Agreement, with any remaining balance at the end of the applicable guarantee period to be paid at that time pursuant to Section 4.2 of the Standard Terms and Conditions.
Signed License Agreement Guarantee(s): Period: January 1, 2014-December 31, 2014 Amount: $100,000 Payable: $10,000, on or before January 1, 2014, with any remaining balance at the end of the applicable Guarantee period to be paid at that time pursuant to Section 4.2 of the Standard Terms and Conditions.
Period: January 1, 2015-December 31, 2015 Amount: $100,000 Payable: $10,000, on or before January 1, 2015, with any remaining balance at the end of the applicable Guarantee period to be paid at that time pursuant to Section 4.2 of the Standard Terms and Conditions.
Period: January 1, 2016-December 31, 2016 Amount: $100,000 Payable: $10,000, on or before January 1, 2016, with any remaining balance at the end of the applicable Guarantee period to be paid at that time pursuant to Section 4.2 of the Standard Terms and Conditions.
56 • The Licensing Book
total $300,000 minimum guarantee plus another $25,000. The AE returns to the line with the finance director who sent you the statement.
Paragraph 37.1(c)
He explains that, while your sales did result in payment of $325,000 royalties, perhaps you had failed to notice that Section 37.1(c) of the Standard Terms of your license agreement states quite clearly that the annual increments of the minimum guarantee are not “cross-collaterized.” You demand that they tell you what that means, and they tell you that it simply means that excess royalties paid in one year of the term do not offset any portion of the minimum guarantee for any other year. The finance director says, “As a result, the statement of account is entirely consistent with the language of your signed agreement. Elsewhere in the agreement, there is also a provision that applies interest at 1.5 percent monthly to all unpaid amounts, and given the passage of time since your account became overdue, the interest calculation is also correct.” You stammer to the account executive, “But we agreed to a $300,000 minimum.” She replies, “That’s correct, but you can’t ignore Paragraph 37.1(c). It appears in all of our license agreements. You just have to know where to look.”
That’s All, Folks
You shout, “Well, this is the last time I am ever doing business with you!” “Not quite, sir, but please take care of this one remaining item of unfinished business before you do. Please pay us the $135,518 that is owed within the stated five business days. And you may also wish to refer to Paragraph 52.16(e)(iii) for our schedule of late payment penalties.” •••• James Kipling has represented licensors and licensees for more than 20 years, negotiating entertainment, sports, artwork, brand, invention, and technology agreements. He is Of Counsel with Dinsmore & Shohl LLP in Cincinnati, and can be reached at (513) 977-8536, or jim.kipling@dinsmore.com. Copyright: ©2013 James M. Kipling. All rights reserved.
Winter 2014
Entertainment Licensing
The Cost of Optioning: More Work Than It’s Worth?
by Derrek S. Lennox, Margin Doctors Business & Management Consultants
W
hether arranged through an agent or negotiated directly, the creation of an option to license an entertainment property can often leave the property owner with more work than it may be worth. An option is created when one entity wants to purchase the right to license a property for a certain length of time before actually licensing it, in order to see if they can profit from developing other products or services based on For the property owner who the property. options, he or she may have to: For example, a software company may option the rights •provide additional artwork to a graphic novel for six months to determine if platform compa•read proposed scripts nies, distributors, and financiers would support developing a •revise or write treatments video game based on the graphic novel—they want the six months •attend the casting calls to see if they can put together all of the deals necessary. •hold the casting calls An option can be a significant dollar value, but in many •interview potential vendors cases, may only be a few hundred dollars, leaving the license •call potential subcontractors price at something much higher, •hold meetings with financiers and often dependant on the deals that the optioning entity structures. So how can that be considered work for the property owner in the first place? In numerous cases, the entity that purchases the options requires a lot of help. In other cases, the property owner may also want to ensure that the property is developed a
Winter 2014
certain way. In both cases, this may involve hours of work on the part of the property owner. The property owner may need to provide copies of all completed works, all works in development, and a detailed story bible that outlines what can and cannot be done with the property from a story, morals, and/or character usage perspective, among others. This may have to be prepared and revised during the life of the option agreement. Questions may be asked—sometimes over and over again—about the story bible, and on “for instances” and “what ifs” around the property details. The property owner may be asked to attend countless meetings, pitch sessions—internal or external—without any further compensation than the initial option fee. The property owner may also be limited on the significant events and story bible alterations and progressions that happen while the option is in play, meaning that stories or developments that were planned but not included in the story bible document have to wait until the option expires. All of this means more work for the property owner. This is not to say that a property owner shouldn’t option their properties. Rather, they should be aware of the extra effort that may be required after the option is in place. After all, not all options will convert into license agreements, but some do. Finding a good agent can often help, but sometimes there is a lot of work for the property owner when moving from an option to a full license. •••• Derrek Lennox is the managing partner of Margin Doctors Business & Management Consultants. He works with the owners of small- and medium-sized businesses to improve their chances of longer-term success. He can be reached at dslennox@margindoctors.com.
The Licensing Book • 57
Directory of Properties, Products and Services
THE LICENSING BOOK, Winter 2014 “THE LICENSING BOOK” (ISSN-0741-0107) is published quarterly by Adventure Publishing Group, Inc.®, 307 Seventh Ave., Room 1601, New York, New York, 10001. Periodicals postage paid at New York, NY 10001 and additional mailing offices. © 2014 Adventure Publishing Group, Inc ®. All rights reserved. No part of this publication may be reproduced or transmitted in any form, or by any means, electronic or mechanical, including photocopying, recording any information storage and retrieval system, without permission in writing from the publisher. Printed in U.S.A. Subscription rates: $48 per year. THE LICENSING BOOK, THE LICENSING BOOK INTERNATIONAL, WORLDWIDE LICENSING and the “WLE” design, are trademarks and service marks of Adventure Publishing Group, Inc.® registered in the United States Patent & Trademark Office Postmaster: Send address changes to THE LICENSING BOOK, c/o Adventure Publishing Group, 307 Seventh Ave., Room 1601, New York, NY 10001.
Adventure Publishing Group..................................................................................................................................................59 BBC .......................................................................................................................................................................................5 Delta Children’s Products .........................................................................................................................................................7 Dracco Company Ltd ............................................................................................................................................................25 Entertainment One Family .....................................................................................................................................................15 Fam Brands..........................................................................................................................................................................49 Gateway Licensing................................................................................................................................................................58 GM Licensing .......................................................................................................................................................................58 Harris-Sachs ........................................................................................................................................................................58 Rubies Costume Company .....................................................................................................................................................29 Saban Brands ....................................................................................................................................................................2, 3 Sakar ..................................................................................................................................................................................21 Sesame Workshop ................................................................................................................................................................60 The Toy Insider .....................................................................................................................................................................35
58 • The Licensing Book
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The Voice Reaching Both Trade and Consumers
CONTACT: JONATHAN SAMET OR LAURIE SCHACHT ADVENTURE PUBLISHING GROUP 307 7TH AVENUE, SUITE 1601 NEW YORK, NY 10001 TEL: 212-575-4510 FAX: 212-575-4521 WWW.ADVENTUREPUB.COM