New Product Introductions, Marketing Campaigns Call for Understanding Online and Physical Retail Realities
BROOKLYN, NY; March 3, 2020—Created for Karen Raugust and my “10 Keys To Success in A Changing Retail Landscape” session at NYTF, these slides can serve as an outline for just about any product introduction or marketing campaign, toy or otherwise. Let us know if we can help you ask the right questions and flesh out the outline when working on your next project.
NEW YORK, NY; February 26, 2020—Characters (and logos) trending up: Harry Potter and Frozen II are still everywhere. Don’t underestimate the staying power of NASA for kids, especially with the namesake organization increasingly active once again. And EVERYONE wants Pink Fong’s Baby Shark license for something. (So maybe there’s another season in Baby Shark, but will that really have long-term staying power? Remains to be seen.)
Smart product: Crayola’s Dry Erase Wall Paint — a clear coating that’s painted on and turns any wall into a dry erase board. (Pictured: Crayola’s Warren Schorr and Licensing International’s Sharon Weisman.)
STEM/STEAM is more integrated throughout the show as virtually all traditional toy companies get involved.
Tiny “collectibles” (the offspring of Shopkins and Polly Pocket) are trending toward smaller groups — six or eight rather than dozens and then more dozens.
Tangle Pets, Ztringz, and other stress relievers are vying to take back the shelf space that went to fidget spinners and shaped rubber bands a couple of seasons ago.
Scratch-off comes to toys: A few weeks ago I wrote about scratch-off greeting cards; now 4DPuzz introduces NYC, London, Paris and world map scratch-off jigsaw puzzles that reveal skylines and other landmarks. The company is primarily known for its beautifully elaborate 3D Game of Thrones, Harry Potter, and other licensed puzzles. (The scratch-offs are not on their website as I write.)
Like Harry and Frozen, kid “influencers” (I can’t say it without the quotation marks) are everywhere: 8-year-old Ryan Kaji/Ryan’s World Youtube channel, with almost 24 million subscribers; 10-year-old gymnast/martial arts video star Payton Delu Myler, with 23 million Instagram followers; and Blippi, a preschool Youtube edu-tainment property created by adult Stevin John with toys coming from Jazwares.
Conversation/get-to-know-you card games are taking on renewed life even as board games continue to resonate for Gen Z’ers, Millennials and others. (Pictured: Yours truly with a Settlers of Catan sheep. Not live. The sheep, that is.)
Sometimes what’s missing is just as telling: Far fewer upstarts showing robot and other electronic building sets than the last two years.
If ever there were a Toy Fair that spoke licensing — it was almost as though if you didn’t have a license (or weren’t trying to license your own property), you were just background noise. I’m not suggesting that’s good. I’m just reporting the impression walking the aisles for a day. And yet…
Quote of the show: “Licensing is great, but it doesn’t work across the board.” Ryan Fens, M&M Sales Enterprises, manufacturer of swings and other outdoor products with licenses for Sesame Street, Daniel Tiger’s Neighborhood, John Deere. Hoping to get the Baby Shark license and add a sound box to play the song while the child swings. (Says I, that sound box would be special to make the parents crazy!)
Retail Radicals: Prescriptions from the Trenches for Revitalizing Physical and Online Selling (and Renting!)
NEW YORK, NY; August 8, 2019—The themes articulated through nine very different presentations at The Robin [Lewis] Report’s 10th annual Retail Radicals forum at Columbia University were consistent to a fault, with overlapping examples (often humorously so), and a common outlook despite the presenters coming from divergent sectors of the retail industry.
- Detrimental impact of reporting comp sales figures;
- Pressure for unrealistic quarterly growth to satisfy The Street;
- Reliance on spreadsheets rather than shopper realities;
- Delivering “local wonder;”
- Growing value of peronalization/customization;
- Decline of the most basic customer service;
- Integration of online-offline shopping;
- “Experiential” shopping.
None of these are new, but in an environment (which no one needed to emphasize to this audience, and no one did!) where store closings compound hourly, the need for more-than-cosmetic change is accelerated, and the perspectives of the speakers, and how they supported their points of view, provided multiple lenses through which to build toward the future. And while The Robin Report, and this event, are focused primarily on apparel and accessories retailing, the insights of the day apply across all sectors.
A Dose of Desperation
Witness the success of online apparel rental companies, represented at the conference, in separate presentations, by CaaStle’s Christine Hunsicker and Rent the Runway’s Gabby Cohen. CaaStle provides subscription model apparel rental infrastructure for retailers including Ann Taylor, NY&Co, Vince, and others. Rent the Runway aggregates apparel and accessories through purchase or consignment from multiple sources and rents items on an occasion or subscription basis.
“With new business models you need a little desperation,” says CaaStle’s Hunsicker, in order to prod senior management at traditional retailers (or anywhere else) to take chances. Similarly, Paul Charron, former CEO of Liz Claiborne, speaks of the “challenge of disrupting without usurping the prerogative of the CEO.”
On the difference between bricks and mortar selling and online rental: “Everything rents; 6%-7% of your [rental] customer base will have your worst-selling garments in their closet,” says Hunsicker. “The most important consideration for the renter: ‘Do I like the photo enough to have it?’”
By Hunsicker’s count, CaaStle’s retailers will sell 2.4 items to the average customer a month — but the rental customer will go through 108 garments over 12 months.
“Customers are our mini-warehouses,” she adds. “If we’re doing our job right, only about 15% of our inventory is in our warehouse at any one time.”
To retain customers, a retailer’s online rental operation needs to add “at least 50 new SKUs a month.” Ann Taylor, she says, introduces 150 new SKUs to its stores and rental system a month. But she also distinguishes between an Ann Taylor, which uses rental to add new, younger customers to its client base, while a retailer such as NY&Co, at least initially, sought only to monetize existing inventory that hadn’t sold through in its physical stores.
The ultimate business question: How long it takes to earn back the cost of acquiring customers. The goal, for Hunsicker, was 12 months. Netflix, she says, takes 20 months. “For traditional transaction brands [going to rental] it’s been two months” for CaaStle clients (CaaStle is only about a year old).
What of rent-to-buy? “It’s price dependent; 25%-30% of revenue from consumers is buy. At Ann Taylor, where the base monthly rental fee is $95, buy is a 30% kicker.”
With CaaStle, the retailer retains ownership of the inventory while CaaStle warehouses and services (processes orders, dry cleans, etc.). This differs from Rent the Runway, which usually owns its inventory, but, as mentioned, sometimes works on a consignment basis.
CaaStle is adding its first men’s brand this month with Scotch & Soda. “Men are more open to new business models,” Hunsicker says, “but it’s one chance [the clothes need to fit/look good] or they’re out.” Two more men’s brands are in the offing.
At Rent the Runway, Cohen says the company is building a drop box network for returning items, which would speed turns. So far Rent has installed about 25 at WeWork locations and at seven Nordstrom stores. Earlier in the afternoon, Columbia University professor and past C-level retailing executive (Sears, Lord & Taylor, Gap, others) Mark Cohen derided the announcement that Kohl’s is installing Amazon returns centers in hopes of building foot traffic.
Rent is also adding offerings that people “don’t need to keep or store,” such as kids’ apparel (they outgrow quickly) and skis.
Integrating Retail Into Lifestyle
Successful physical fashion retailing is “not about racks and racks and racks of apparel,” says Kevin Roche, of retail design firm Woods Bagot and a nine-year veteran of design for LVMH.
Roche sees continued “integration of office, living, retail, entertainment, sports” in uniquely designed spaces, and a need to incorporate “tons of technology and touch screens” in bricks and mortar stores.
Luxury retailers, in particular, he says, should trim the number of their physical outlets. “There should be 5-8 Nieman-Marcuses,” he says, while large-scale redesigns should be more judicious. “You can spend $300 million to redesign a flagship like Macy’s, but that won’t impact your other 584 stores.” It’s different, he notes, if you’re Harrod’s and you have only one store.
Is Smaller Better?
What of smaller-footprint outlets ala Target and Nordstrom’s efforts? “Walmart closed 114 Express stores in 2018,” notes Columbia’s Cohen. “The customer may live in the neighborhood [and see it as a neighborhood store] but they still expect 200,000 square feet of merchandise,” says Columbia’s Cohen. Also from Cohen:
- “The off-price growth streak is over.”
- “Walmart has foolishly entered a race [with Amazon] that it cannot win. Amazon is a market place, not a store. Like it or not, Walmart is a store.”
- “Acquisitions add to a company’s efforts [to grow] as ceramic tiles do to a mosaic.”
If you have the opportunity to hear Mark Cohen in person, do so. While he is very entertaining, his store-by-store critiques are uncompromising, and I can barely touch on his prepared remarks let alone the adlibbed asides. Ultimately asked by an audience member who does retail well, he didn’t miss a beat responding “Costco,” then adding, as he thought, Amazon, Zara, and “Feldman Housewares on the Upper East Side, near where I live. You go in and ask for what you need and the woman at the register tells you what aisle it’s in or that they don’t have it and you’re better off ordering online. Mom and pop hardware stores have an incredible array of merchandise and offer the best customer service anywhere.” To which everyone nodded in agreement.
Slides below are courtesy of Mark Cohen:
The eye-opener for many, judging by the gasps as her slides went up, was Alibaba’s Candice Huang. Consider:
- Alibaba’s Singles Day sales event on 11-11 (all “1’s” for a shopping day designed for singles) generated $30.8 billion in sales in one day compared to total U.S. online sales of $24.2 billion over the five-day Thanksgiving holiday (Thursday through Monday).
- The platform boasts 700 million active monthly users who, if they stay with Alibaba for five years, place an average 23 orders across 132 categories and spend $1800 annually through the platform.
- With all the focus on China’s growing middle class, Huang says Alibaba has 100,000 users spending $159,000 each annually, though no one asked if that includes small businesses that might be making bulk purchases (think of the dollies of food items purchased at Costco by small restaurants and food carts and trucks).
- 59% of users are under 29. (Rent the Runway’s Cohen says median age for its customers is also 29.CaaStle’s Hunsicker says its sites’ core customers are 28-45.)
- Among Alibaba’s sites, Huang describes Taobao as a “superapp” from which customers can do general retail shopping as well as book travel, live entertainment, and other services — analogous to the shift at malls to offering more entertainment options in addition to traditional shopping.
Quote of the day:
- “’Focus group’ is a dirty word.” — Alexander Genov, head of consumer research for Zappos.
Note: Slide up top courtesy Christopher Timmins, Intel, which presented the The Robin Report conference along with sponsor SAP.
ACROSS THE UNITED STATES; July 17, 2017—Rarely do you literally drive head-on into the challenges and opportunities of licensing as my wife Riva and I did this summer.
The property: National Geographic, founded in 1888.
Tracing the route: Start with an elaborate, beautifully orchestrated presentation at Licensing Expo in Las Vegas, an early stop on what turned into a 9-week cross-country road trip visiting primarily national parks and forests.
Add 45-minutes the next morning with a bleary-eyed but no less enthusiastic and articulate Rosa Zeegers, who I first met during her 12+ years in licensing and business development at Mattel, and who is now EVP Consumer Products & Experiences at National Geographic Partners, the for-profit spinoff of the National Geographic Society that was formed two years ago by 21st Century Fox (which owns 73% of NG Partners) and the Society. A percentage of all profits from the operation benefits the Society.
But our paths didn’t stop crossing in Las Vegas, and it was those additional crossings that drove home, so to speak, so much of what was presented at the summit and that Zeegers and I discussed.
The talk of Yosemite National Park, where we happened to be on June 3rd, was how rock climber Alex Honnold scaled the 3,000-foot El Capitan without ropes in a record three hours and 56 minutes that morning. Who documented the event? National Geographic.
Heading north to Redwood National and State Parks, who had documented the height of the tallest Sequoia sempervirens — better known as a California redwood about 10 years ago? National Geographic.
Who publishes the detailed trail map to Olympic National Park (among many others) that our rock-climbing son-in-law lent us? National Geographic.
Throughout our trip, which covered about 10 parks and forests in the U.S. and more in Canada, references to National Geographic cropped up repeatedly. And therein both the challenges and opportunities.
Name and logo recognition? Check.
Your grandparents’ magazine? Check.
Dusty stack of old National Geographics in the basement or attic? Check.
You get the idea.
At its Vegas presentation, which served as a summit for existing licensees but also included select potential licensees the company was hoping to impress and bring into the fold, the emphasis was on National Geographic’s efforts to attract millennials. Touting its status as a No. 1 social media brand (the No. 1 title seeming a bit fabricated, based on “the number of social actions” such as likes, shares, comments, and retweets over a three-month period in 2015, as measured by Shareablee), spotlights the divide between the substantially older group that follows the classic print magazine and books, and the younger audience for the TV and online offerings. Theme-based issues of the magazine such as those on gender, or on Mars, have skewed younger than the traditional audience, and more of these are on the boards.
But bridging that gap is the challenge that hangs over all future opportunities — opportunites that are varied, numerous, and not limited to licensing.
For example, Zeegers says the company is “moving up [the] vertical integration” ladder, having recently purchased Global Adrenaline, a tour operator it had worked with on a licensing basis in the past “so we earn more than a royalty.” National Geographic has 16 partners in the travel segment, as well as lodges. That travel group represents an effort that was started 17 years ago and which has shown 20% annual growth over that period. Up next for travel: Adding river cruises.
The company plans on “building a kids franchise” with various potential spinoffs. “Millennial parents want kids to play with toys that add substance, that pull them away from the tablet and educate — but are still fun,” says Zeegers.
Focus will also fall on National Geographic Live, e-commerce, books, and, of course, licensing, among other areas under Zeegers’s purview. Outdoor fashion and footwear, she suggests, are organic brand extensions which Zeegers sees as an opportunity “for a retailer to grow together with us.”
The timeline for new licensing agreements? Two years, with a two year option, and assuming a year for negotiating and product development. “What’s five years in 129?” Zeegers asks with a smile.
The franchise she is looking to drive in new directions, to younger audiences, is living history. After 12,124 miles I can vouch first hand.
P.S. The photos accompanying this story are Riva’s and mine, not National Geographic’s; the video link is theirs!
Looking to understand the marketplace as you extend your brand or product line through consumer products licensing? Contact me for competitive research at email@example.com.
NEW YORK, NY; March 6, 2017—Sequential Brands Group’s Yehuda Shmidman did his best to put a positive contextual spin on the current state of retail at Li©ense Global’s sold out NYC Summit last week. Even if you didn’t agree with all of his assumptions, he made a compelling case for a future (five-plus years from now) in which we will “look at this [period] as the ‘2008 crisis’ for retail,” a reference to the financial collapse of that year.
Shmidman’s boiling down of the root causes of the current status of retail to two key factors — we are “overstored” at 48.4 square feet of retail space per capita in the U.S., compared to 23 square feet for the next largest market, the UK; and the disruptive effects of e-commerce — crystalized the themes that emerged in a day and a half of presentations by licensors, licensees, and agents at the Marriott Marquis in Times Square. (More on Shmidman’s observations shortly.)
Among the themes:
- Impact of Trumponomics — in particular trade agreements and tax structures — on the licensing business.
- A shift away from boomer-centric to millennial-centric shopper behavior, and the commensurate overwhelming challenge of embracing social media and staying ahead of trendlines. (A favorite presentation among Summit participants I spoke with was PepsiCo Creator Carlos Saavedra — yes, that’s his title, and licensing is part of his domain — whose talk centered on implementing experiential licensing-based programs that spur social media use and lead to new business concepts.)
- Continued rapid growth in licensors’ embrace of off-price and club stores.
- “The anxiety [that the] retail store-based consolidation that we are seeing is the tip of the iceberg,” as PVH’s Ken Wyse put it.
- Acknowledgment of limited growth opportunities for evergreen brands (e.g. “maintain” brands at Iconix, including Canon, Waverly, and Fieldcrest; “heritage brands” such as Izod at PVH. Of course both have developing as well as high growth or, as Iconix terms them, “driver” brands).
- Impact of just-in-time sales data which, combined with consumer ability to order instantly, requires substantially greater speed to market and, as Xcel Brands Robert D’Loren put it, “52 seasons a year.”
- Dramatic differences in how companies define “experiential” licensing, which might mean the Kola House restaurant in NYC’s meat packing district for PepsiCo, sponsorship of a half-marathon for Iconix’s Danskin Now brand, or arena eSports events for Activision Blizzard.
- Near-impossibility of countering counterfeits in many markets.
‘Trumponomics’ Trumps the Conversation
“How will Trump changes impact global trade?” PVH’s Wyse asked. Some were more uncertain than others of how trade policy will shake out. Robert D’Loren of Xcel Brands (and the financial co-founder with Neil Cole of Iconix who had previously run the retailer Athlete’s Foot) was the most emphatic. Having lobbied congressional offices in Washington, DC the prior day with the American Apparel and Footwear Association, he was convinced “the border tax will become law. We were arguing to phase it in to give us some time.”
Speaking of brand holding companies such as Sequential and Iconix, that specialize in licensing out all manufacturing, equity research analyst Eric Beder, of Wunderlich Securities, wasn’t hazarding a guess as to what the new administration will do on the economic front, but suggested that some of the proposals under consideration could deliver “a new tax structure that could potentially destroy every brand that doesn’t have core,” core being something that they make, market, and distribute themselves. (Interestingly, Iconix’s Dave Jones said earlier in the event that Iconix deems itself “asset –lite; we don’t make anything,” touting that as a positive aspect of its business model.)
Of a potential border tax, Beder adds, “A border tax doesn’t let you account for cost of goods [in your pricing]; and you can’t turn on a dime to manufacture in the U.S. It’s going to be tough for Republican senators in states like Arkansas to vote for.” Unlike D’Loren, Beder said, “I think it won’t happen, but it will keep rearing its head” and keep that state of anxiety high.
Meanwhile, Wyse noted that he’d made the infamous shirt and tie licensing deal with Donald Trump 11 years ago. “At some point, for various reasons, I wound up a member of Mar-a-Lago,” he said. “And recently I ran into the president there. He remembered me, and remembered the deal. We talked, and he was very much on top of the apparel business.”
As for the “2008 crisis for retail,” Shmidman likes to look to the book business, which he said is now “post-crisis,” for inspiration: 46% of book stores are gone, he noted, while in the apparel business, for which 15% of sales are online compared to 10%-12% for merchandise overall, only 7% of stores are gone so far. With the growth of online retailing, he added, “We have to be able to adjust distribution.” To that end, Sequential is increasingly focusing on building digital businesses for its brands. Example: Martha Stewart meal kits, a “pure digital business” that is “growing double digits month to month.” Earlier that week, Sequential had downgraded its guidance for 2017, attributing the decline primarily to weakness in the department store segment.
- Off-price retail sales were up 9% 2015-2016, reported Iconix’s Jones. But off-price, discount, dollar, and clubs are “mostly for our ‘maintain’ brands.
- PVH’s Wyse said off-price is “crucial — not for designer brands, though we certainly sell some Tommy [Hilfiger] and Calvin [Klein] at Costco. For our heritage brands it’s vastly expanded. We might have a halo [presence] at Macy’s or Belk. But where off-price might have once been 12% of business for certain brands [it] can now be 20%-40%.”
- “Retailers need to get better at e-commerce. It’s not something we want to be in on our own.” (Dave Jones, Iconix)
- Brand marketers and retailers need to “reimagine shopping, entertainment, and social as one.” (Robert D’Loren, Xcel Brands)
- “PepsiCo is doing something every agent in this room wishes every client did: applying metrics beyond dollars.” (Debra Joester, The Joester Loria Group, which represents PepsiCo). On a similar note, Scott Bannell, recently retired from Stanley Black & Decker (represented by Beanstalk), outlined the four objectives that company has for licensing: Increase brand impressions and touchpoints; please end-users so they buy more core; expand to new channels and partners; and use licensing income to invest in brand-building programs.
- “We are a media company, not an apparel company.” (Robert D’Loren, Xcel Brands)
- “We don’t sell posters anymore. We sell wall art.” (Dell Furano, Epic Rights, which specializes in licensing musical artists)
- “We are one year away from Amazon, WalMart, and Alibaba accounting for $1.5 trillion in sales.” (Yehuda Shmidman, Sequential Brands Group)
- “Retailers don’t want the brand, they want product performance.” (Scott Bannell, Stanley Black & Decker)
- “Don’t think you can give licensing part-time to someone on a team.” (Scott Bannell, Stanley Black & Decker)
- “Wall Street doesn’t like debt anymore, which hit Iconix and Sequential[‘s stock valuations].” (Eric Beder, Wunderlich Securities)
- For subscription box service Loot Crate, “every box has to arrive the same day, so the videos of people opening the boxes aren’t spoilers.” (David Morris, Loot Crate)
- Spirit Halloween’s 1300 stores do “the same volume in eight weeks as [parent company] Spencer Gifts does in a year.” (Eric Morse, Spirit Halloween/Spencer Gifts)
- Asked what licensors can do to help retailer Tesco, the retailer’s Rachel Wakley said, “Talk to us. Walk our aisles. Make sure your licensees sell your brand as well as you do. If you have to call me to ask for feedback about your licensee you’re probably working with the wrong licensee.”
- “If you can’t sell it in a tweet, it’s not good enough.” (Rachel Wakley, Tesco)
- “Let the customer tell you what they want, then be the best to deliver it.” (Rachel Wakley, Tesco)
- “If you’re rotten and toxic on the inside, no amount of makeup is going to cover that up.” (Drew Barrymore, actress and founder of Flower Beauty, a cosmetics brand available exclusively at WalMart, and other companies.)
Ira Mayer, co-director of the Institute of Branding & Licensing at LIU Post University, and former Publisher of The Licensing Letter, conducts competitive research for marketing and licensing companies. Contact him at firstname.lastname@example.org.
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!
“They call themselves ‘creators,’ we call them ‘influencers,’” says Dreamworks/AwesomenessTV’s Jim Fielding. Dreamworks owns Awesomeness, which is a marketing engine for young (often very young) makers of YouTube videos. There is also an Awesomeness social media community for the tweens and teens that marketing engine targets.
Fielding, who spent more than a decade with Disney Stores, including four years as President, and then served as CEO of Claire’s, knows his audience — and old media types like me are decidedly not in his sights. Fielding’s mission: “Connectivity and commerce,” he says — to help those “creators” establish strong direct relationships with consumers as well as a strong retail presence.
From a viewer perspective, Awesomeness is an umbrella for YouTube channels that cater to these demographic groups. The nomenclature is awkward, though: Awesomeness refers to its social media offering as a network while it prompts those coming to its website to “Watch our channel.” But the “channel” is an aggregation of 91,000+ existing YouTube channels as well as those generated specifically by Awesomeness. And again, admittedly, I’m not the target, but I find the AwesomenessTV interface confusing for trying to find a specific creator’s work unless they happen to be featured. (Much easier to get there directly through YouTube.)
Semantics and my own navigation challenges aside, the channel signs creators with existing YouTube followings and uses its marketing expertise to propel them to higher levels of viewership. Licensing can become part of the package — that’s part of where Fielding figures in — though as in other entertainment realms, the creators often retain those rights for themselves, or their managers/agents/parents/lawyers or other handlers.
Still, the power of that umbrella is considerable. “Discovery might have 300,000 viewers for a very successful video,” Fielding told me at Licensing Expo in Las Vegas last month. “We put a video up yesterday that had 1.5 million views in three hours.” Awesomeness adds 24-32 “pieces of content per week, plus longform” videos. Awesomeness also creates videos for brands looking to engage its audience of tweens and teens.
While many see the shelf-life of these videos as extremely limited, Fielding points out that search can bring viewers back to old episodes. He cites as an example “Life So Rad,” a series created for retailer Kohl’s. When the third season went up, viewers sought out the first two seasons, which they found even though those older shows were no longer highlighted on the site.
That can be a blessing and a curse, since the fashions a Kohl’s might be featuring in a season one episode probably don’t exist by season two, let alone season three. Still, it signals that much sought after level of engagement.
Among the more successful of Awesomeness’s stars are:
- Amanda Steele, who started posting YouTube videos when she was 10 and is now 16. Her subjects: beauty and fashion.
- Ingrid Nilson, who has been making videos for seven years, was a judge on Project Runway, and has three million YouTube subscribers and at 26 is earning 6-7-figure endorsement and other marketing fees.
- Tyler Oakley, a humorist, author, and gay rights advocate who used his social media celebrity to raise $1 million on his birthday for The Trevor Project, an L.A. non-profit that provides a safe haven for LGBT and questioning youth in times of crisis. On the more “commercial” side, he stages pajama parties on college campuses, where $250 VIP tickets include meet ups.
The company will support a new “creator” by backing production of 6-12 episodes. “If there’s the right engagement we’ll do more,” Fielding said.
Fielding sees the biggest threat to these celebrities’ longevity in how long they will be willing to produce two to three videos a week. “Most of them started by making selfies,” he notes. The more visibility they get, he adds, the more sophisticated the production values get and the more time it takes to produce even 2-3 minute clips.
The bottom line, says Fielding: “The fans will tell us when [the Awesomeness creators/influencers] aren’t relevant.”
Contact: Jim Fielding, email@example.com.