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Whither the Donald Trump Licensing Program?

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.

Inadvertent Case Study: Jimmy Buffett’s Margaritaville Lifestyle Brand

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 ira@iramayer.com to meet at another time.

 

Fearless Forecast 2017:The Need For Speed and Other Challenges/Opportunities

NEW YORK, NY: December 19, 2016—I’ve been formally asking marketers about the challenges and opportunities for the year ahead at least since 1988 (before that if you want to limit it to music, home video, and video games). And I’ve been fashioning the responses into an annual (more or less) Fearless Forecast ever since.

Truth is the answers haven’t varied much over the years. For the licensing community in particular, the overriding challenge: Securing the right retailers for new and old licensing programs. The opportunity: Hitching onto the Next Big Thing (challenge: before it’s too late).

The word clouds here sum up this year’s survey responses as well as the longer-term themes, and even give voice to some of the more existential concerns (e.g. “Is licensing still the right nomenclature to describe the business?”)

challenges-2017
Licensing Challenges 2017
opportunities-2017

Licensing Opportunities 2017

Not wanting to prejudice responses, I deliberately did not ask about the implications of the U.S. election and growing nationalist sentiment in many parts of the world. Interestingly, no one brought those factors up unaided.

In conversations, however, when asked, it is clear there is concern about potentially stricter trade laws and how they might affect deal-making. Will IP owners and manufacturers hold off on some decisions — especially as they relate to B and C properties — until the dust settles and we have some direction? (Not a new phenomenon, even when there aren’t trade questions on the table.) Will there be greater focus on “made here,” in terms of origination of IP as well as manufacturing, wherever “here” may be?

More challenges:

  1. Closing licensing deals takes six months at the very short end of the spectrum, with 12-15 months an unscientific median.
  2. The move to “fast retail” that is spreading beyond apparel, challenging traditional licensing models.
  3. See #1 and #2 above, and note the inherent conflict.
  4. Managing expectations. There are very few seven-figure (let alone eight-figure) advances on licensing programs, and with the exception of a handful of high-profile entertainment and sports properties, precious few that will generate retail revenue of $10 million+ annually, certainly not in Year 1 or 2 shy of some major fad that would likely be short-lived. Yet IP owners new to licensing — and sometimes folks experienced in the field — invariably set those goals, only to be disappointed or to fail.
  5. Figuring out who to push off the shelf in order to get on the shelf. It’s the most elementary question for any new licensing program. Even in the age of “unlimited shelf space” online, the fact is consumers go for the handful of best-sellers. As in traditional brand marketing, it’s the #1 and #2 in a category that account for by far the greatest percent of sales.

Consider: In a pre-Christmas Target tour, looking at licensed properties, close to 10% of the toy section was given over to Star Wars, and just shy of 5% for Marvel. Paw Patrol, Teenage Mutant Ninja Turtles, even Shopkins, one of this year’s hottest girls’ offerings, were about 1% each.star-wars-at-target-12-16

More opportunities:

  1. Speed is of the essence. See #1, #2 and #3 above! The winner is he/she who can “turn it around” while the property is still hot — goes for the IP owner AND the manufacturer — and that can keep refreshing the assortment on a 3-6 week cycle rather than quarterly or semi-annually.
  2. Be realistic. See #4 above. Always best to exceed expectations.
  3. Giving retail the differentiators it needs. Not just a single “exclusive” SKU, but a program.

Here’s to 2017’s numbers being better than 2016’s. And to your own participation in marketing and licensing being more fun, more productive, and more rewarding in the New Year!

Let’s Prognosticate

screen-shot-2016-12-07-at-2-43-01-pmBROOKLYN, NY; December 7, 2016—Here’s a two-question survey to help assess where the licensing and merchandising business is headed in 2017. Please respond by December 12th; I’ll post an analysis plus my observations later that week.

If You Don’t Like the (Licensed) Luxe of It…

If it looks like licensing, tastes like licensing, smells like licensing and feels like licensing, is it licensing? Not necessarily for a range of luxury brand collaborations and partnerships, says Unity Marketing’s luxury marketing guru Pam Danziger in The Robin Report.

In the article, Pam and I explore the question in the context of examples including Kathy Ireland’s furniture line with Raymour & Flanigan and Sarah Jessica Parker’s partnership with Manolo Blahnik to develop a shoe collection exclusively for Nordstrom—cases where the celebrity often has an active role in product design and development.

screen-shot-2016-09-28-at-5-44-05-pm“Some [other] collaborations are short term,” notes Pam. “Capsule collections that many fashion designers do with off-price brands like Target and H&M—while others are more substantial, like Apple and Gucci, or Tag Heuer, Google, and Intel for smart watches. Other examples are Valentino and Havaianas flip flops; Tory Burch and Fitbit wearables; Beats headphones by Dre and Fendi; and Cynthia Rowley and J.Crew wetsuits.”

Click here for the complete article, including many more examples of unique luxury market collaborations and partnerships.

And if you’re looking for competitive research on licensing and branding — luxe or otherwise — contact me at ira@iramayer.com.

Three Real Trends For April 1 (No Joke!)

NEW YORK, NY; APRIL 1, 2016. Taking One Click To The Max: I bet brands are “clamoring” to be included in Amazon’s Dash Buttons program, as the program’s director tells The New York Times. This is Amazon at its most creative: Amazon Prime members purchase a button the size of a key fob for $4.99 that is programmed to order one of a given item. Screen Shot 2016-04-01 at 3.04.52 PMPut one for Tide in your laundry room, click when you’re running low, and two days later the item arrives as part of your Prime free two-day delivery. Time is currency, and no one recognizes that better than Amazon these days.

Will Hammock Become A Verb? I admit I wasn’t up to speed on the degree to which hammocks are trending — especially at colleges. Here’s the update you, too, should be aware of from Sporting Goods Business. Screen Shot 2016-04-01 at 3.40.15 PMUniversities have been licensing hammocks; and there are plush Winnie the Pooh-in-a-hammock toys (but no human-sized Pooh hammocks that I could find). But given the seasonality discussed in this article — with this summer season’s sales over, but the fourth quarter a major selling season despite the cold — others may want to test the opportunity.

Raising The Ethnic Fashion Bar: With immigration such a hot button issue this election year, it’s fascinating to see the apparel industry embracing ethnic and religious fashions. “Items include the likes of saris and salwar kameez worn by Indian women; hijabs, abayas, and burkas for Muslims; and kimonos and yukatas for Japanese women and girls,” among others, writes my colleague Karen Raugust in “Licensors Eye Ethnic Fashions,” her latest Raugust Reports blog. Until recently, designers limited such lines to the countries in which a particular group is centered. Screen Shot 2016-04-01 at 3.45.13 PMRaugust sees licensing increasing as women in these areas seek more fashionable options, and as designers focus on growing ethnic/religious populations in Europe and the U.S. Raugust discusses examples including Selfridges in the UK, Uniqlo’s U.S. and Southeast Asian stores (see photo), and Spain-based chain Mango as well as name-brand designers active in the space.

Ira Mayer, former publisher and executive editor of The Licensing Letter, conducts competitive research and licensing opportunity assessments. He 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. Ira is moderating a session on “How to Work With Licensing Agents & Consultants” and Karen Raugust is leading a session on “Crowdfunding For Licensors and Licensees” as part of the LIMA Licensing University program during Licensing Expo in Las Vegas this June.

 

 

 

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.