Haven’t Had Your Fill Reading About Pokémon GO Yet? Try This…
Following up on why there won’t be a “next” Pokémon GO, as if there hasn’t been enough written about it:
- Book and toy as well as mass merchants and other specialty retailers, are not surprisingly reporting vastly increased demand for Pokémon merchandise. See Publishers Weekly for bookseller (and bookstore café managers’) comments on how the “New Pokemon Game Takes Bookstores By Storm.”
- While there have been reports that Nintendo is signing Pokémon GO licensing deals “left and right” (see NY Post), that is inaccurate on several counts: First, Nintendo doesn’t control the rights, The Pokémon Company (TPC, of which Nintendo is a part owner) does. Second, The Pokémon Company signed its deals for the 20th anniversary of the property last year and marked that occasion with a Super Bowl commercial this past January. So while the degree of success of the app was unanticipated, the fact that there would be renewed attention on the property, which Millennials grew up with, was not.
- The Pokémon Company London office covers all of Europe, where poster and other merchandise licensee GB Eye’s Max Arguile relates to me his own conversation with the company. “Given that there is no difference between the artwork of Pokémon and Pokémon GO,” Arguile says TPC told him, “it makes no sense for them to spend time negotiating licenses that would effectively replicate what they already have in the market (and either making licensees pay twice for the same thing or annoying them by appointing a competitor). The only difference in artwork is the addition of GO to the logo. If [their position on not licensing separate Pokémon GO Images] changes they will let us know but right now they are busy fielding multiple calls every day from all the major retailers — this is where the real money is, not in adding licensees. [In the wake of the Pokémon GO Phenomenon,] Tesco, Asda, Sainsbury, Primark, Debenhams, Matalan and M&S have all ordered big apparel ranges for Q3/Q4 2016. This will be achieved by print-on-demand. Other categories, such as bedding are going into most of the same retailers.” Arguile adds that TPC forecasts “some big collaborations in 2017.”
- The most recent estimate of worldwide retail sales of licensed Pokémon merchandise is for 2014 at $328 million, according to The Licensing Letter. I estimate that in 2015 the property would have been down somewhat as is typical prior to an event such as a 20th anniversary. Published reports of $600 million seem way out of range.
- Publishers Weekly isn’t the only non-game trade magazine reporting on Pokémon. Try this one from Billboard, about the characters landing in music business offices. Not to mention the fact that the New York Police Department issued Pokémon GO Safety Tips, sent by email to subscribers to its various alerts as well as posted on its website.
- While Millennials are the core audience, even among my boomer contemporaries, the topic literally came up in every dinner conversation the past week, and a number of friends have downloaded and played with the app, though they’re not going out in search of merchandise. (At least not until this filters down to their grandchildren…)
Why There Won’t Be A ‘Next’ Pokemon GO
NEW YORK, NY; July 12, 2016—Here’s the Pokemon GO story — “How Pokemon GO Took Over The World And Why There’s No Point In Ripping It Off,” a commentary by The Wrap’s Phil Owen — you need to read if you’re wondering how to cash in on the craze.
For years I’ve been warning people that building their business plan on being “the next Beatles,” “the next Disney,” “the next Andy Warhol” is to set yourself up for failure. If you do that well, great — and hopefully you can be prepared for how to prolong the life of the property or project. But most business propositions aren’t going to hit the stratosphere.
Years ago I asked Clive Davis, the legendary music business impresario and then Arista label-head, how surprised he was when the single “There Goes Another Love Song” off the Outlaws’ debut album was a hit “out of the box.” “Not surprised enough not to know what to do.”
It was a brilliant answer that I’ve quoted often, and that has informed much of my research into and thinking about pop culture over the years.
I don’t agree 100% with Owen: I suspect there will be a market for other Pokemon GO-like augmented reality games. They just won’t be the phenomena that Pokemon GO is, and as long as the creators don’t scale up for being “the next Pokemon GO” at least some will be viable.
The critical question is how long Pokemon GO can be sustained and, for Nintendo, whether it will have a salutary affect on sales of Nintendo game systems, games and licensed merchandise. (See my recent post, “Sustaining Licensed Properties In A Multi-Platform Universe.”) Generally, the faster a fad takes off, the faster it crashes.
FYI, if you’re a gamer of a certain age thinking it’s time to cash in on your dusty classic Pokemon collection, eBay had 440,296 Pokemon items available when I just checked, 95,548 of them trading card collections.
Need competitive research? Someone to bounce marketing strategy off of? To educate corporate officers about licensing? Contact me at firstname.lastname@example.org.
Licensing Expo At 35,000 Feet: Sustaining Licensed Properties In A Multi-Platform Universe
EN ROUTE, LAS VEGAS, NV to NEW YORK, NY; June 23, 2016—Over 26 years attending Licensing Expo, whether sitting down to interview people or walking the aisles, I always get variations of the same question (especially from exhibitors who rarely get to leave their booths): “What are you seeing on the floor?” “What’s new?” “What’s hot?”
The truth is, when you’re at the show, the elaborate exhibits, the characters walking around, the noise, the constant visual bombardment make it difficult to process what you’re experiencing beyond realizing that the longest line at the show was to have your picture taken with Grumpy Cat (except for those of us allergic).
So to all who asked me that question this year, while I was in my tradeshow stupor, and to those just wondering, 35,000 feet on the way home offers the needed distance to pull some thoughts together.
The key theme for me: Sustainability has dual meanings. One is environmental, which is subject for another time. The other is about sustaining the life of a property in a digital age. I’m going to focus on the entertainment/character/gaming worlds here, but that subject is top of mind for every brand, fashion, sports, art, and other licensor, manufacturer, agent, and other player as well.
Traditional media still count, certainly to companies rooted in it, but the fact is many of the digital content producers don’t yet understand the importance of multiple platforms, including the traditional ones.
“Linear still has the reach and consistency you need” to support a licensing program, Cartoon Network’s Pete Yoder told me. “But we also know mom hands off [he moves his smart phone from one hand to the other] to the kids.” Three key changes in the digital age:
- “We’re developing content specific to each digital medium. It’s based on the same IP but we’re not just re-editing 11-minute programs to 90-seconds.”
- “We’re ordering the number of episodes we need by medium from the beginning.”
- “Years ago you needed 6 months to a year after a program was a hit to get a licensing program underway. Now the question is, ‘When are you launching the first access to the brand’” via any medium.
At Activision, the “traditional” medium is games, and that — just as obviously as TV is for Cartoon Network — continues to be the core. But the news at Activision is a Netflix commitment to two seasons of a Skylanders Academy series. “Our audience is 6-12, with a real sweet spot of 6-9,” the company’s Ashley Maidy noted. A linear program, for her, has the potential to “bring new kids in — younger kids whose older siblings know the game, as well as others who just haven’t been exposed to it at all. . . .It’s a marriage of digital product and multiple platforms.”
The transformation of Skylander across platforms has proven easier than for Call of Duty, but a film is in the works for that, as well.
Activision’s challenges — and a common refrain at many companies: “We still have to educate buyers and retailers who are tradition-bound that our customers aren’t watching TV. And with no ratings for Netflix, how do you measure success?” [Aside: One of the most promising areas to Activision founder Bobby Kotick, Maidy says, is eSports, which Kotick believes — and Activision will be playing an ever-greater role to accomplish — could be as big as the NFL in five years. Why not think big?]
Both Yoder and Maidy agreed with me that even two years ago if someone had offered them Netflix as an outlet for a series they would have turned up their noses. Not anymore.
That said, hyperbole from the digital world doesn’t really help on the measurement count, in part because it feels as though (not just at Licensing Expo, but in the “wider world”) that the digirati don’t really understand what’s important to know. They can measure all sorts of things, but those numbers don’t necessarily translate to something the IP, ad, or licensing worlds can use.
Consider Paladin Software’s James Creach, speaking as part of the Digital Licensing Summit program at the Expo, who observed that “the Super Bowl is watched by 112 million people but 1 billion people are active on social media in a month.” Well, an event watched simultaneously by 112 million people — roughly one in three Americans — is a very different story than a billion people spread across almost as many messages of all sorts. The latter isn’t unimportant, but the comparison does no favors in selling the medium.
I didn’t get to speak with anyone from Youtube, but their booth looked like a lost opportunity. Clearly a major player as an outlet for new IP as well as for creating new channels for existing programming, the company had a huge space. But from the outside all one saw was a small sign with some of the properties named. No effort to educate what the properties are, where Youtube fits in, how it translates into consumer products or even just to pique interest. I don’t think I’m alone among show attendees (OK, of a certain age — but younger as well) in having heard of only a very few of the properties named.
I’ll get off my soapbox in a moment. But coming from the print publishing world, one of the things I’ve watch many “digital-only” publishers discover is that at this point in time, to satisfy advertisers, they still need print. Similarly, digital video celebrities or others will find it difficult to sustain their fame or develop long-term careers without multiple platforms — and I don’t mean just multiple social media. Just as traditional media have been forced to embrace new media, so new media will need to embrace the old. Tyler Oakley, who is part of the Dreamworks/Awesomeness stable, gets it: he’s out there touring with a live show, there’s a documentary, AND he keeps up his video and social media output. Rock and roll, watch out. [Commented one music merchandiser: “We survived superheroes and Star Wars. Music is trending up.”]
Most trenchant observation by a newcomer to licensing at the show, though: John Haugh, the 3-months new CEO and President of Iconix, at a reception for Peanuts licensees: “I know many of you would like a Peanuts movie every year. We would too, but nobody does a movie every year, not even Star Wars. And I want to remind you that many of you have done very well with Peanuts for 50 years before there ever was a movie!” Talk about sustainability!
How Far Will Nickelodeon Take Its Sports Identity?
NEW YORK, NY—MARCH 7, 2016: Is Nickelodeon carving out a new hybrid major league sports-entertainment genre for itself? Others have made efforts in this arena, but none on a platform as wide as Nick’s.
Nick went through a long dry spell as far as developing new, licensable IP. Not for lack of trying, but it isn’t an easy (or scientific, no matter how much testing) process.
Now Nickelodeon is expanding its two-hour Nicktoons sports programming block with the introduction of two high-profile new series produced by Rob Drydek, and one unique licensing program combining a sports figure and a hit animated property:
- Crashletes is a video clip series hosted by New England Patriots’ player Rob Gronkowski;
- Jagger Eaton’s Mega Life is a reality series starring teen skateboarder Jagger Eaton;
- NBA star Carmelo Anthony, aka Melo, is behind an exclusive-to-Macy’s TMNT x Melo fashion line built around the Teenage Mutant Ninja Turtles.
Asked whether Nick will be able to create licensed merchandise incorporating Gronkowski and Eaton, the network’s Pam Kaufman told me at the Nick Upfront that they certainly hope to. “We’re figuring that out.”
Joint licensing of sports and entertainment isn’t a new idea, but TMNT x Melo carries the concept several steps beyond the usual Warner Bros. or classic Disney characters on jerseys, teddy bears, and bobbleheads.
Success will breed plenty of imitators; that’s inevitable. But Nick can use a concept that has built-in renewability; its mix of sports and entertainment can expand with new athletes and be applied to new hit properties as they emerge.
It’s 17 years since SpongeBob SquarePants debuted on Nickelodeon. Sixteen years since the first Dora the Explorer episode. It wasn’t until 2012 that Nick revived TMNT, and 2013 that Paw Patrol began its run and that the revitalized Power Rangers re-emerged in their 20th season as Power Rangers Megaforce.
From a licensing perspective, that left Nick with a more than decade-long lull where, because there was no new breakthrough animated IP, the network’s consumer products division had to do its best reinventing SpongeBob and Dora to carry it. Warner Bros. has faced similar issues over the years, with DC Comics (Batman, especially, but Superman as well — even in non-movie years), Looney Tunes, Tom & Jerry (at least outside the U.S.) and other classics tiding them over.
“Cross-licensing, primarily involving character/entertainment properties along with leagues, teams, and/or players, has long had a presence in the sports sector,” wrote Karen Raugust last month in her excellent trend-rooted RaugustReports blog. “Going back at least to the mid-1990s, the four major U.S. leagues were partnering with classic characters such as Peanuts, Mickey and Minnie Mouse, and Looney Tunes.
“The trend,” Raugust noted, “tends to ebb and flow cyclically, but has been on the upswing lately, with characters from Hello Kitty and Tokidoki to Domo and Betty Boop all being featured with team or athlete imagery on a range of merchandise, in association with the leagues and/or their players associations. The technique also has expanded internationally; examples range from Sesame Street and the Australian Football League to Smeshariki and the Zenit St. Petersburg soccer club in Russia, to name just two.”
With few exceptions (Disney had an NHL/Phineas & Ferb deal in 2011, and there have been several crossovers in Europe), these deals are character rather than program-driven, and are often promotional rather than based on long-term consumer products campaigns.
As for Nick’s current stable of properties, Paw Patrol — produced by Spin Master with Nick and Canada’s TVOKids — is the big recent new hit property and the reconstituted Turtles and Power Rangers have proven resilient as shows and on retail shelves with licensed merchandise.
Whether Nick can parlay Gronkowski’s and Eaton’s live action shows into merchandise, or whether they and other athletes can be teamed, so to speak, with others from Nick’s animated stable to build on this niche, remains to be seen. Nick is well-positioned, though, to make it happen.
Ira Mayer, former publisher and executive editor of The Licensing Letter, conducts competitive research and consults for marketers; takes clients on retail tours; and offers courses on licensing to corporations and at colleges and universities. You can reach him by clicking on the “Contact” button above left.
Walking Toy Fair 2016: Trends, Start-ups, and Licensing Opportunities
NEW YORK, NY: FEBRUARY 16, 2016—My favorite parts of Toy Fair are invariably the far aisles on the main floor upstairs and the downstairs exhibits. That’s where many of the start-ups and smaller players are and where you get a sense of the ideas that are propelling toy inventors and designers.
Here are my idiosyncratic impressions after two days walking the show at the Javits Center, with a few added comments based on a recent spate of store visits.
Star Wars isn’t disappearing any time soon. Sphero will have competition for its BB-8 later this year when Spin Master brings out its own version of the robot. The creator of the Spin Master BB-8, Thomas Tretter, was doing the product demos, happily admitting he “gets paid to do what he did as a kid.” Also via Spin Master, Air Hogs will have an expanded Star Wars line.
But SW was ubiquitous, if anything moreso than even last year and eclipsing even the strongest of the strong. Manufacturers uniformly report that Star Wars is still going gangbusters, and many are still developing new assortments. Marvel is Marvel, DC is DC, and they’re next in line. I was surprised not to see more new Minions on the boards, as retail is still going strong with that as well. Universal’s Secret Life of Pets clearly has momentum, though, with Spin Master’s Best Friend Max wobbly-walking dog from that upcoming film a candidate for next Christmas’s must-have toy (Elmo beware). Commonwealth and Spin Master are also working Angry Birds in anticipation of that film.
The expansion of Melissa & Doug, once exclusive to specialty toy retail, is nothing short of astounding. The company used to eschew licensing, but has some Disney and other properties. However, unlike LEGO, which reinvented itself (and came back from the walking dead) through licensing, Melissa & Doug hews true to its origins even if distribution has expanded to mass, education stores, and more.
JoyLabz had perhaps the oddest display among the robotics/electronics startups: Makey Makey was demonstrated using a piece of tin foil folded on a table, with hand-written marker instructions, and five bananas with connector leads in them hooked up to a laptop. Touch the foil with one hand and use the other hand to hit the bananas (“it could be anything conductive; we just used bananas,” the demonstrator noted, though their sales materials feature bananas too), and you get music from the laptop. The kit can also be used to make game controllers, instruments, and “inventions.”
There’s really no breakout company in robotics. If I were a buyer, I’d be hard pressed to decide who to go with — both whether they have the wherewithal to deliver, and what might make the product stand out. Most seem to create different lighting or noise patterns from generic component parts, and there’s little guidance for what you can do further. As a group, they’re coming of age, but they’re not there yet.
Among the more traditional science kits, Smart Lab used licensed Star Wars and Disney Princess to distinguish itself. Based on retail visits as well as the show, Smithsonian and National Geographic are dominating this sector at specialty, in book stores, and at mass.
3Doodler and Creopop are among several companies offering handheld 3D printer pens. 3Doodler has had an adult version on the market at $99; the new child version is $49. Different colors of instant-hardening plastic are available. Using the pens requires pretty serious fine motor skills; not clear to me exactly who the market will be for kids versions. 3D printers are also rapidly coming down in price to where they might have potential as consumer items, but again, the killer app that could transform them from “having potential” to “must have” has yet to surface.
A year or two ago formable sand products for home and school were relatively high end, sold by Brookstone initially; the variety is expanding rapidly now under a variety of names (Kinetic Sand from Spin Master, but Magic Sand, Aqua Sand) — in colors (including glow-in-the-dark from Sands Alive), packaging, and price.
Zing’s StikBot Studio — a toy-size green screen with little characters you can use to create your own stop motion animated videos — expanded its one-year-old line with a more extensive “Pro” kit. Zing also has Wet Head, which is a hat with a little reservoir for water and stick plugs coming out. It’s essentially “Russian roulette with water,” as a demonstrator put it — the hat is filled with water, players spin a wheel to indicate which plug to pull out, and eventually one of the pulled plugs releases the water.
AzIAm Girlz yoga dolls, which first shipped this past December, is growing its line.
There’s growing availability of sophisticated tool sets. New at the show this year was Toydriver from the “smart screw specialists.” Toydriver is a mini powered screw driver designed for the small screws used in children’s toys but also for small hands. Sidenote: Toys R Us carries an extensive line of Home Depot-branded tools and child-sized workbenches and the like that are truly standout.
On the gardening front, Triumph Plant has been doing a beautiful job with Crayola for a number of years. There’s a My First Plant series, and a Color A Plant Pot kit. And they’re re-introducing a Charlie Brown tree to go with their Charlie Brown Grow a Pumpkin kit; the tree had been around for a few years, but the company wasn’t able to get the seeds for the last two years. Triumph’s Jim Johansen also said the company has licensed the Garden State Parkway for a wildflowers line. It’s an outgrowth of Lady Bird Johnson’s highway beautification program and could be expanded to cover other states’ highway wildflower programs.
Morphmallow’s Spaghetti Headz hair accessories remind me of the coiled shoe laces that were a fad for a couple of years. Generic versions of Spaghetti Headz have been on the market at $9.99 list for about two years; Morphmallow, exhibiting at Toy Fair for the first time, is now adding licenses including Care Bears, Garfield, Betty Boop, and the upcoming Steven Spielberg film The BFG selling at $12.49. Target is tweens to young teens, with the designs with feathers at the end appealing to the older end of the spectrum.
Capson and Zoofy, to name just two, are outfitting caps (brand name Brick Brick) and backpacks, respectively, with boards that work with Lego and other similarly sized building blocks as well as with miniature versions so kids can customize their look. Capson had the Disney logo, an As logo, and a Hello Kitty image to show what you can do, but was quick to say they don’t license those images, “they’re just to demonstrate what someone can do.” In fact, they don’t even sell blocks — those are user-supplied. Zoofy used generic designs to illustrate the potential on its backpacks.
Pinbox 3000 is likely typical of many toy startups these days: They used a Kickstarter campaign to raise the $15,000 they needed to make the diecuts they needed for the first run of their cardboard “pinball machines” which are blanks. The examples they showed demonstrate how you can draw or photograph your own backgrounds, use discarded toys or household objects, and so forth to create your own game. Make, an online magazine (makezine.com) wrote about the product last July and started selling it. That sent them back for a second run. They’ve also developed special education and library market versions. The basic kit is $49.95; a large “double kit” is $89.95.
Speaking of make your own: Yottoy, which is both a publisher and makes plush and collectibles with licenses for Babar, Madeline, and others, signed on as an Eloise licensee about a week before Toy Fair. A beautiful lunch kit was hand painted to get it on display in time, VP creative director Peter Doodeheefver showed me proudly. Sales of licensed Madeline merchandise benefited enormously from a museum exhibit at the New York Historical Society, as did sales of Paddington goods with release of the Paddington Bear movie. Next up for them is The Little Prince movie; but Yottoy typically has these properties long-term; the movie and museum shows are bonus opportunities.
Not a toy per se, but a fun product: Fan Hands (company and product name) — special gloves designed to make a loud clap when at a sports event. Marc Jones, President/CEO and inventor of the gloves, has had the patent since 2013 and has been selling a generic version. But if this isn’t a product designed for licensing… Jones has a relationship with CLC for another product line he developed; he’s looking to expand that to Fan Hands, and to add MLB and NHL “to start.” NFL, he says, is too complex and too expensive to deal with starting out.
Colorforms and Highlights are two children’s brands that have been largely dormant for a number of years. Both are re-establishing their reach through licensing programs the results of which were in evidence at Toy Fair this year and should be more in evidence at retail over the next 12 months. Colorforms is owned by Out of the Blue; Highlights is independently owned.
The success of eOne’s Peppa Pig — which itself is expanding its licensee roster through U.S. master licensee JazWares — is prompting a small surge in other pig properties. Not that pigs haven’t always been popular, but this year sees the addition of Pass the Pigs dice from Winning Moves, among others. Note to Warner Bros.: Is it time for a Porky comeback?
That’s all folks!
Ira Mayer, former publisher and executive editor of The Licensing Letter, conducts competitive research and consults for marketers; takes clients on retail tours; and offers courses on licensing through colleges and universities. You can contact him by clicking on the “Contact” button above left.
Why Does It Always Come As A Surprise That Entertainment Is A Hits-Driven Business?
NEW YORK, NY; JANUARY 19, 2016 — “Stars” — and by extension, hits — “can’t do it alone anymore,” concludes Concurrent Media’s Paul Sweeting in a dead-on analysis of 2015 movie box office and music sales. And his argument could easily extend to books, video games, TV shows, and other entertainment media.
It’s hardly news that fewer than 4% of movies released last year would have accounted for 23% of all tickets sold, or that Taylor Swift and Adele dominated the declining CD market (in part by withholding their new music from streaming services). In the publishing world, 21 adult coloring books accounted for 13.5% of total positions on the trade paper bestseller lists last year, according to Publishers Weekly.
In any given week, check out the Monday morning reports to see how much the prior week’s No. 1 movie, album, book, etc. outdistanced the No. 2. It’s pretty dramatic — unless you happen upon a week that’s setting a new record for lowest sales of a No. 1. (Bottom fishing is a contest no one is proud of winning, but it’s happening with increasing frequency.)
None of this is a new phenomenon, though the annual headlines as the full-year data rolls out never seem to recognize that fact. Consider this year’s Wall Street Journal headline earlier this month: “Hollywood’s Banner Year at the Box Office Masks a Procession of Flops.” Was there ever a year when that wasn’t the case? And not just for movies. The thrust is no different than that for the headlines we would have run in the trade magazine Record World when I worked there in the mid-1970s (think Carole King’s “Tapestry” or Fleetwood Mac’s “Rumours”) or that you’ll find in any of today’s movie, music, TV, game, or other trades.
Those headlines reflect the fact that entertainment is a hit-driven business. The “long tail” of the Internet was supposed to change that, because everything (or nearly everything) could be available forever and because fans would find their way to offerings beyond what the studios, music labels, mainstream publishers and others released.
But nothing suggests that the mass audience cares about the long tail. It’s the hits that dominate Youtube and Spotify and Kindle and all of their relations, just as they dominate the box office, and just as they once dominated the now-dying packaged media businesses of LPs, CDs, DVDs, video games, and more. (Important exception: Printed books are regaining momentum from ebooks.)
This isn’t necessarily a bleak scenario. But building a more resilient entertainment business, says Sweeting, “requires a lot more data than most studios or record labels currently collect or effectively analyze, and the sort of data-driven, audience-focused marketing and release planning that runs counter to the hits-driven, star-making machinery the movie and music businesses have long-relied on to drive the business.”
I agree to a point. However, it’s also true that too much of what is produced and released by mainstream entertainment companies has been corporatized to a point of little distinction. It’s interesting that Don Henley’s statement following the death of Eagles bandmate Glenn Frey earlier this week said, “We were two young men who made the pilgrimage to Los Angeles with the same dream: to make our mark in the music industry.” I suspect he was using today’s terminology, because I doubt in the 1970s they wanted to make their mark on the industry. They more likely wanted to make music —and a living doing so.
The bottom line: Entertainment takes talent and industry, as it always has.