NEW YORK, NY; August 2, 2018—If you’re not looking at the NOW’ers (aka Generation Z or the Post-Millennials), you’re already behind in the retail and marketing wars, says Kathy Sheehan, EVP/GM of GfK Consumer Trends, a market research organization.
And if you think that the only difference between NOW’ers and Millennials is that the NOW’ers are even more tech savvy, you’re totally going to miss the opportunities for reaching a currently 15-25 year-old cohort that comprises 26% of the population — greater than the Millennials or the Boomers.
Speaking yesterday at the Annual Retail Forum at Columbia Business School —Retail Radicals, presented by The Robin Report, Sheehan outlined the characteristics of this soon-to-be overarching market:
- In the U.S., NOW will comprise 30% of the population by 2020, 47% of them non-white.
- Globally — and Sheehan said the U.S. mirrors the global findings — 84% have at least one major stressor; 47% say they don’t have enough free time. Their #1 pressure: Themselves. #2: Money.
- They are less likely than Millennials were at the same age to aspire to prestigious brands; 48% strongly agree they want “good value for the money.”
- Security will be imperative — financial security, which manifests itself in NOW’ers’ thriftiness (compared to Millennials penchant for aspirational brands), and both online and physical security.
- NOW’ers are more attuned to privacy than the members of any other generation, with Sheehan believing that will have major implications for the development of artificial intelligence (AI) applications.
- Similar to Millennials, NOW’ers will continue to delay growing up life cycle events including moving out, marrying, and having kids.
- Tech proficiency ranks only #6 among 18 perceptions of self among this group, though 68% believe they are tech savvy.
- Convenience is important to them: 37% say they will pay more for products that make their lives easier.
- “It’s possible they’ll never go into a physical store.” [That’s a contention every other speaker disagreed with in the course of the day-long event.]
- Rising values for NOW: Creativity, internationalism, ambition, equality, knowledge, learning, thrift, and social tolerance. Declining values: Sex, being youthful, individuality. “Ten years ago everything was about customization and personalization. Not now, not for this group,” said Sheehan.
In a spirited Q&A, one audience member commented that social tolerance extends only to those they agree with, otherwise “they’ll shout you down.” (Sheehan was taken aback but acknowledged that this is “an age of extreme polarization.” Another questioner wanted to know if the GfK findings differentiated between urban and rural NOW’ers, suggesting that there would be differences. (The GfK data, some of which was first released about a year ago, is not broken down that way, but Sheehan noted that the similarities in major cities globally are striking.)
Observations from other speakers throughout the day:
- Every retailer has the same 1 million online customers. A retailer won’t get all of them all the time. But getting beyond that million is very difficult.
- We’re smart enough to know we don’t know where retail will be in 2 years.
David Strasser, SWaN and Legend Venture Partners
- From an investment perspective, outstanding management with a mediocre idea is better than weak management with a great idea.
Jill Granoff, Eurazeo Brands
- People want less shit, smaller homes so they can spend more on experiences. How do we service that consumer with real value and convenience?
Alex Brick, SWaN and Legend Venture Partners
- People are getting tired of fast fashion.
- Commenting on the downturn in apparel retailing: People bought too many clothes.
Millard “Mickey” Drexler, legendary retailer who founded Old Navy and variously led The Gap, J. Crew, and others
- Some customers want convenience, others want value, and still others want curation.
David Katz, Randa Associates
- Retail radicals that are models for others: Amazon, Costco, Apple, Casper, Best Buy.
- Retail brands that have successfully reinvented themselves: Best Buy; TJX nameplates TJ Maxx, Marshalls and HomeGoods; Ikea; Zara.
- Top 3 retailers in need of radical leadership: Walmart, Nordstrom, Macy’s.
Mark A. Cohen, consultant and professor.
- Barriers to retail radicals’ success: leadership, culture, capital, and speed.
Robin Lewis, consultant, publisher of The Robin Report.
- “There’s a panicked, freaking out search firm looking for a new CEO for Penney.”
Mark Bozek, LiveRocket
- “If I were running Penney, I’d let it go. Same for K-mart and Sears. We have too many stores anyway.”
Paul Charron, former Chairman, Liz Claiborne
NEW YORK, NY; May 26, 2018—In the end, it’s all about boxes, isn’t it?
Amazon was, is, and will remain The Topic for licensors, manufacturers, retailers, consultants, agents, and anyone else involved in the business of licensing. And what is Amazon about if not boxes?
The headline out of Licensing Expo in Las Vegas this month had to do with Merch Collab, the online retail behemoth’s new program offering design and manufacturing/sourcing expertise for fast-to-market licensed merchandise to be sold on its eponymous website.
But as much as has been written about Amazon’s impact on retailing, that impact can’t be overestimated. Whether Epic Rights’s Dell Furano holding forth on the shift of music and celebrity t-shirt and jersey sales from venues to physical retail to online or Cartoon Network’s Pete Yoder enthusing about the technology behind Amazon Go, the company’s prototype supermarket (and likely all-merchandise) store of the future, to cite but two conversations during Expo, any conversation about retail inevitably turned to Amazon.
A part of that discussion that tends to be underrepresented, however, concerns Amazon’s various experiments with physical retail. Just as many “digital-only” magazines discovered the need to develop physical magazines because that’s what advertisers demanded, so, too, Amazon clearly recognizes that physical retail isn’t going to disappear.
My friend Marty Porter, executive director of the Media & Entertainment Services Alliance (MESA), and author of the Record Plant Diaries, calls this phenomenon “physigital,” and predicts that physical media will cater to the luxury segment of the market while digital will be for the masses. Amazon understands and lives that concept instinctively.
That’s one type of box. In my idiosyncratic take on what was fun and interesting at Licensing Expo, though, there’s another:
Cross Bratz with Shopkins, mix in the unboxing craze, add steroids, and you have Boxy Girls, which debuted exclusively at Walmart via Jay@Play the week of this year’s Licensing Expo. The child gets the doll in a box that has additional little boxes with clothes, accessories, makeup and other items. There are add-on boxes with multiple surprise boxes, boxes with two limited edition dolls plus little boxes, and so on. This is completely of-the-moment. Jay@Play is represented by Cynthia Hall Domine’s licensing agency, Synchronicity.
Cartoon Network (CN) has worked with subscription box licensees Loot Crate and Box Blvd., notes CN’s Pete Yoder, who sees boxes as viable long term rather than a fad, particularly as the ratio of consumables is increased in the mix.
In a larger context, boxes (and unboxing) are part of the trend toward licensing experiences rather than products. CN has been upping the number of live and touring shows it does, says Yoder, especially in Latin America and EMEA. CN launches its first cruise ship in 2019 — cruises have become a staple for Disney — and the network has its CN-themed Six Flags amusement park in China. In the U.S., Adult Swim’s Rickmobile started touring the country last summer; now there’s an Adult Swim music and comedy festival scheduled for Los Angeles this October and featuring Run the Jewels, among other acts.
BuzzFeed had one of the more curious booths — certainly for those of us who aren’t regular BuzzFeed addicts (that includes me). Visitors toured its big red box of a booth, with only the name out front by entering a series of doors that led to rooms that had displays and might also be housing BuzzFeed execs for meetings in action.
There wasn’t much to fill you in on exactly what the rooms represented (I went through three times at different points in the show, uniformly hearing people mystified and curious) until you read the thick newspaper-like handout that explained the rooms were themed to popular BuzzFeed channels — in particular the foodie Tasty brand room, which had a display of kitchen utensils and a chef preparing pancakes and other goodies. Turns out the line of Tasty-branded utensils are also a Walmart exclusive.
Shout out to BuzzFeed for the best swag of the show: When you got to the end of your self-guided tour there were bags on pegs and shelves from which to select whatever items you wanted — multi-colored measuring cups and whisks, cosmetics cases (or maybe they were pencil cases?), glass water bottles, miniature yo-yos…Eric Karp is heading up the licensing effort.
And moving beyond boxes. Way beyond boxes:
The dinosaur roaming the show entrance near the Universal booth and scaring the bejesus out of unsuspecting passersby was presumably promoting the upcoming Jurassic World: Fallen Kingdom movie opening June 22. I say presumably because no one was indicating what he was about, despite a handler upfront in dinosaur-wrastling get-up and a handler in the back keeping people away from the giant tail. The guy inside this costume wielded it phenomenally well.
Lenovo’s Jedi Challenges, available since late last year but offering demos at the show to attract other properties is the first augmented reality game I’ve seen that defined the genre for me: Put on the goggles, extend your lightsaber and you’re jousting lightsaber to lightsaber with a Jedi. Or in local mode, with another player. Asked whether the Star Wars relationship with Disney bodes well for Marvel and other Disney franchises down the road, a spokesperson suggested that “it’s easy to imagine” such a scenario but for now they are “concentrating on Star Wars.” That said, more software is needed to justify the expense of the $199 headset, but the play value is pretty incredible.
Walking malls in recent months conducting licensing tours, I’ve been struck by the variations on the classic photo booth — booths that upload to Instagram, selfie booths (contradiction in terms, no?), booths that feature licensed properties. At the show, Sony Pictures had an interesting iteration with a screen featuring characters from its upcoming Hotel Transylvania 3, opening July 18. Facing it, when you moved, the character mirrored your moves. Your image appeared in the corner near the movie character. More traditional: When Grumpy Cat wasn’t available in person for a photo, you could step in an old-fashioned photo booth and pose next to a preprogrammed Grumpy Cat.
On the promotional side — and what is Licensing Expo if not a promotional event? — kudos to WWE and, especially Sesame Street (see photo up top for your humbled blogger and friends), for the photo ops in the show’s registration area. Great way to talk into a show.
The booth garnering the most speculation was perhaps that of Jonathan and Drew Scott, known for their HGTV Property Brothers home-fixer-upper TV show. The booth referenced Property Brothers but the license being offered was Scott Brothers.
I assume Property Brothers is owned by the network and that the Scotts want to control their own licensing. (That’s akin, so to speak, to the situation many chefs featured on, say, Food Network, find themselves in: Network owns the show and controls licensing rights, but savvy chefs have retained the rights to their individual names.) The Scotts’ booth — a large, multi-tiered, beautifully outfitted affair — was packed when the brothers were on hand, and not very populated the rest of the time, save for a few staffers.
Licensing Expo is not just about entertainment, though it can feel that way. There are heritage brands, literary properties and artists along with fashion labels, sports properties, and others. Among the heritage brands new to the show this year were two fourth generation members of the family that founded Capezio, the classic dance apparel and footwear brand. While the brand was once licensed to a wider audience, it has in recent years been more limited to the dance community. Reimagining the brand through licensing is the plan.
The Licensing University program sponsored by LIMA orients hundreds of newcomers to understanding the benefits of licensing, the structure of the business, the trendlines and more.
I had the honor once again of leading the opening “Basics of Licensing” panel with “godfather of licensing” Gary Caplan, of Gary Caplan Inc., and Hallmark’s Katy Briggs. Thanks to you both, and to LIMA’s Marty Brochstein for inviting all three of us to participate.
Finally, at the airport leaving Las Vegas, there was a great pop-up booth dedicated to local hockey team the Vegas Golden Knights, who made it to the Stanley Cup finals. Sporting goods stores in Fashion Show mall were also festooned with Knights merch, but the pop-up was a great unintentional last impression of the show!
Looking for a licensing assessment to assist with strategy and new business development? I’ll help you identify the white space for your licensing program through competitive analysis. Visit www.iramayer.com for details.
BROOKLYN, NY; April 13, 2018 — A basic Google search of “Trump suits” brings up the results pictured above — including a suit for sale at Walmart, which is a working click through, presumably selling off what was left of the line Macy’s stopped selling after then-candidate Trump’s remarks about Mexican immigrants being criminals and rapists. The Google results also include a (theoretically, or at least it says so) paid Macy’s ad for those suits right up top that takes you to an “oops” non-working page.
Clicking through to trump.com/merchandise/signature-collection/ takes you to a page where the only working link is for eyewear at eyeglasses.com, which is not one of the active licensees in a Washington Post article detailing the status of the Donald Trump licensing program. The Post finds two of 19 companies Trump said were paying royalties in 2015 still doing so.
While the article sometimes compares apples to oranges (estimated retail sales vs. royalties), let’s extrapolate: In 2009, the Post notes, Trump claimed licensees sold $215 million of Trump-branded goods, which (my estimate) would have yielded him roughly $9 million in royalties. By 2015, per the Post, royalties were down to $2.4 million, while Trump’s 2017 financial disclosure reports royalties of $370,000.
These days the Trump Organization sells Trump-branded caps, gifts, and other items that it sources, inventories, and markets (as opposed to using licensees). Full Washington Post report here.
So much of the coverage of Toys ‘R’ Us’s demise is mis-directed. CNN Money gets it right. Debt killed the toy star — not Amazon. As for the dire forecasts elsewhere that fewer toys will be sold? Others will pick up the pieces. Indeed, does this spell O-P-P-O-R-T-U-N-I-T-Y for someone?
BROOKLYN, NY: February 23, 2018—An idiosyncratic distillation of New York Toy Fair this week.
Is Rubik’s the Toy World’s Betty Boop? Max Fleischer’s Betty Boop first appeared as a cartoon character in 1930. She has since been successfully licensed for thousands of products. Even young people who don’t recognize the name know the image. And as you travel, you’ll find Betty in store windows around the globe as a come-on, even when the stores barely carry any Betty merchandise.
I was reminded of Betty at Toy Fair seeing the number of booths with a Rubik’s Cube at the sign-in desk. It only really sunk in my second day, so I can’t tell you if they were all licensees, or distributors, or putting it out there to amuse visitors while they wait for their appointments, or legitimate knock-offs (patents have expired, though trademarks are still in effect for the word Rubik and Rubik’s).
Bricks, Briks, and Pix. If you start your annual tour of Toy Fair as I do downstairs at the Javits Center in Manhattan, where the newer, smaller, scrappier companies tend to be, and head north from the southernmost aisle, one of the first booths you would have seen this year is Rubik’s Briks, from Strictly Briks, which are compatible with other brick sets such as LEGO’s.
Speaking of compatibility with the Danish company’s toy blocks, that’s been a theme for years now, with plenty of toy companies riding LEGO’s coattails into construction set glory. The above video of a replica of Coney Island’s Cyclone roller coaster illustrates a personal favorite among the relative newcomers to what I term construction brick interoperability — whatever the brand, they’ve all got to work together. As for the Cyclone, I live in Brooklyn, NY after all, just a few miles from the real thing. The set is manufactured by CDX (CoasterDynamix) and has been out since mid-2017.
Non-tech Toys With Tech-ish Names. Another variant on interoperability with LEGO is Pix Brix, which offers “pixel art” by way of mini-bricks (also compatible). That plays into yet another theme: companies with traditional (read that non-electronic/non-digital) toys trying to imbue those toys with a hint of interactivity by borrowing tech-ish descriptors — for example, “pixel” art, or their tag line, “What will you pixelate?” Similarly, Charles Zadeh’s booth featured art kits urging kids to “Explore your inner selfie” while puzzle-maker 4D Cityscape Time Puzzle, which makes upscale 3D puzzle (not sure what the 4th dimension is here), incorporating 4D into its name. That company has about eight Game of Thrones titles, just signed Harry Potter and has 6-8 Potter puzzles forthcoming. Nothing tech about these.
From Tech-ish to Tech — And Every Gradation In Between. My bad for not being aware of the term “mixed reality” until the show, certainly not in the context of toys. But there it was on signage touting MergeVR’s Merge 6DoF Blaster, one of at least half a dozen devices at different booths integrating a smartphone as its screen.
Thank you Wikipedia for the formal definition: “Mixed reality (MR), sometimes referred to as hybrid reality, is the merging of real and virtual worlds to produce new environments and visualizations where physical and digital objects co-exist and interact in real time.” Move in a real space and you move similarly in the parallel universe of the imaginary space on the screen.
Variations On Classic Themes. Slime is back. A generational fad if ever there was one (comes back about every 17 years). When Cra-Z-Art saw sales of its glue soaring as children used it with other ingredients to make slime, the company licensed the Nickelodeon name and produced a now best-selling slime-making kit. Meanwhile, Keycraft Global’s variant comes in Goobands (remember SillyBandz?), and Steven Spangler has DIY slime science kits. That’s just three of many slimey products. . . .Twee (funny name for a company, but hey) offers gorgeous sidewalk chalk that comes in the shapes/images of sushi, glittery donuts, and more. . . .Bobble Head banks from Tin Box Company featuring DC, Star Wars and other licenses. . . .My Arcade’s miniature arcade replica games licensed from Bandai Namco and Data East.
Hot Brands. Rick & Morty. Game of Thrones. Minecraft. I keep hearing that Paw Patrol is falling off, but it’s still omni-present. Ditto for Star Wars, but more on that in an upcoming post. Coming on strong: Bendy and the Ink Machine. I didn’t know, either, folks; year-old horror videogame from TheMeatly Games. Runs on multiple platforms. Watch it (the brand), but don’t wait too long to sign on.
Off-the-Beaten Path Licensed Brands. Bachman Trains with Ringling Bros. Barnum & Bailey Circus (now certainly a nostalgia brand; how long can it be maintained? Will Feld revive the brand in a new context?) and Norman Rockwell. . . .American Chess picking up Bobby Fischer. . . .Kitchen/home graphic designer and children’s book illustrator Mary Engelbreit will have her own Looney Labs card games later this year.
Collectables. Imperial Toys’ collectable food trucks, coming out fall. Imperial is known for bubbles — and they have a new variant on the flavored bubbles they first introduced a year ago, to be known as Lick-A-Bubble going forward (1.6 million views of the ad on Youtube since mid-January). But food trucks are definitely trending, and for a company as non-trend-rooted as Imperial to come up with nice designs, with side hoods that go up to reveal the kitchens plus movable roofs, this is a nice surprise. The preliminary packaging says 5+ but I see this as a 20-something office fad. Toys aren’t just for kids, you know.
On that note: There has long been a market for upscale collectables for adults, but credit Funko for expanding the category and giving it legs.
New, Neat & With Licensing Potential. Stroller Costumes to entice kids to get in. “Inspired by my son, who refused to get in the stroller. I designed one that looked like a truck. Problem solved,” says inventor/dad-preneur Moses Atkins. Definite potential for licensing. He found interest among licensors, retailers, and manufacturers.
Sago’s Pillow Playsets, which are beautifully detailed with sewn pockets, curtains, and other features. Retailing at $49.95, for upscale toy/gift boutiques and, again, potential for licensed versions. Toronto-based Sago, by the way, launched five years ago offering wordless apps for kids that have now been downloaded 27 million times and subsequently became an activity toy company.
Roooz Planet is a book with an exceptional array of characters its author/illustrator Rooz Mousaur sees delivering environmental messages.
Glove-A-Bubbles makes an oversized glove that has a pouch for bubble mix and different size holes above the fingers. Empty the bubbles into a dish, dip the upper part of the glove in, and wave your hand to generate multiple sized bubbles. The original art isn’t that interesting, but the concept could definitely work for licensed characters.
Other Views. Writer/consultant/photographer Karen Raugust kicks off her Toy Fair coverage with a look at the role social media influencers such as toy testers, mommy bloggers, comedians, singers and pranksters are playing in the toy industry. LIMA’s Inside Licensing goes behind the press releases, including commentary on poop toys and games, and collectables. The Wall Street Journal explores the toy industry’s efforts to match fast fashion’s speed to market.
Looking for an independent analysis of your existing or potential licensing program? Contact me at email@example.com.
BROOKLYN, NY; February 11, 2018—One of the best inadvertent case studies of a licensing program I can recall ostensibly centers on the imminent Broadway opening of Jimmy Buffett’s musical “Escape to Margaritaville.” But the guts of the piece are about “the Margaritaville® Mesquite BBQ Rub:” how Buffett the millionaire maintains the “authenticity” of his heavily licensed laid back lifestyle brand.
“This is America, and poor-quality licensed products are our birthright,” writes Taffy Brodesser-Akner in the Sunday New York Times.
“But Mr. Buffett won’t give you that. . . . He protects your experience of the lifestyle he sells in a way that someone living that lifestyle should be incapable of. . . .This is no longer a business. This is a cause.”
When did that metamorphosis occur for the ’70s singer/songwriter/leader of the Parrotheads? “Probably it was around the first time he put the Margaritaville name on a salt shaker-shaped pool raft labeled ‘Lost Shaker of Salt.’ Or went all-in on a brand partnership to sell a $499.99 Tahiti™ Frozen Concoction Maker®. Or when he signed off on the emblazonment of ‘I’m the Woman to Blame’ across a Tervis tumbler.”
There’s much more, from why he took over his own licensing (“because he could do it better than the people who were ripping him off with concert T-shirts that spelled his name as Buffet.”), and myriad ways “he could make sure that even when he left town [after a concert his fans] could still have the island getaway they so longed for.”
A must read.
Attending Toy Fair? Karen Raugust and I will be addressing the question, “Are You Ready For Licensing?” Sunday February 18, 3:30-4:30 p.m. as part of the Toy Association’s Licensing Content Connection seminars (free to registrants). Hope to see you there, or contact me at firstname.lastname@example.org to meet at another time.