Though Licensing Expo 2018 officially ran from Tuesday through Thursday last week, most attendees and exhibitors were consumed with meetings, summits and other events for at least a couple of days before that.

For LIMA and 33 hearty cyclists, the week began early Sunday morning with the 2nd Annual LIMA Charity Bike Ride in the Red Rock Canyon National Conservation Area.

For attendees of Licensing University, four days of 32 sessions of panels, presentations and roundtables kicked off first thing Monday morning.

And for others, the rousing start was provided by a standing-room-only Keynote session featuring the launch of Merch Collab by Amazon.

It was a session that was certainly of the moment, as one of the biggest topics of discussion at the Expo is the ongoing disruption of retail, and particularly the jigsaw puzzle that property owners and their merchandise licensees need to navigate in putting together a program.

But, as always, the Expo was also a treasure hunt of sorts, with everyone seeking the next big idea or business opportunity. Cannabis, anyone?

The following articles will give you a taste of the Expo and some of the notable news developments and moments from a Licensing Week that was filled with both.

Amazon Uses Keynote to Highlight Launch of Merch Collab by Amazon

At the Keynote session at Licensing Expo in Las Vegas yesterday, Amazon launched Merch Collab by Amazon, bringing together brands and a group of about 150 artists to produce licensed apparel and other products.

The program, in development for about a year and in testing for six months with CBS Consumer Products, Cartoon Network, Hybrid Apparel and YouTube influencer Shane Dawson, is designed to speed the process of bringing licensed items to market and making them for sale through a brand’s Amazon storefront.

In crafting a program, brand owners and Amazon create style guidelines for the IP, which are submitted to the artists, who decide whether to create a design. Once a design is developed, it is submitted to the IP owners for approval.  If approved, a product could be posted in the online store in as little as an hour. Brand owners decide how many or how few artists to work with. Dawson, for example, is working with two artists on his line of apparel, jewelry and other products, says Erin Stover of United Talent Agency, which represents him. Under the agreement, royalties are split with one-third going to artist and two-thirds to the brand, which pays Amazon for the service.

The decision to launch Merch by Collab was largely tied to Amazon customers seeking a broad selection of products, Amazon VP Nicholas Dennisen said during the keynote presentation. While brick and mortar retailers typically may carry 2-3 variations of a t-shirt design, Amazon customers may seek 100. For example, the best-selling shirt licensed from Cartoon Network’s “Rick and Morty” via the program features a character that appeared only during the show’s 2013 debut season. There are hundreds “Rick and Morty” designs on Amazon, 84% of which sell, Dennisen said. Eighteen percent of the 84% generate the bulk of sales, he said. The service also builds on Amazon’s Brand Registry, which was launched a year ago in an effort to combat counterfeiting.  About 60,000 brands have registered for the registry, Dennisen said.

“The physical constraints of off-line retail can restrict the types of brands and the number of branded products consumers can purchase and ecommerce removes these constraints,” Dennisen said. ‘The most successful brands online aren’t necessarily those on retail shelves.”

For brand owners, the motivation behind joining Merch Collab is driven by the need to monetize the peak of a show’s popularity, said Veronica Hart of CBS, which launched with Merch Collab with “Star Trek”, “Twin Peaks” and “American Vandal.” In addition, the new service will allow brand owns to test new IP and use sales data to help guide product distribution.

“It is an opportunity to give a wide array of products to our audience and fans,” said Peter Yoder of Cartoon Network. “With all the designs and characters that are in ‘Rick and Morty,’ each resonates differently with each fan and we aren’t able to provide as much we would like to to brick and mortar.”

With Amazon having the ability to print on demand, “it gives us a chance to do a lot more time-sensitive products so if a new episode comes out we have something in the marketplace the same day,” said Yoder “We can that take advantage of the fans wanting to be able to live that moment.”

Contacts:

Cartoon Network, Peter Yoder, VP, 212-275-6535, peter.yoder@turner.com

CBS Consumer Products, Veronica Hart, VP Licensing, 212-975-6894, veronica.hart@cbs.com

United Talent Agency, Erin Stover, 310-776-6229, stovere@unitedtalent.com.

Brands and Companies Positioning Themselves for Potential Cannabis Market

With cannabis cleared for recreational use in a growing number of U.S. states and expected federal approval in Canada, many companies are positioning themselves as lifestyle brands in a bid to reach a broader market outside the cannabis industry, executives said during a Licensing University panel discussion at Licensing Expo.

That broader reach could be tied to celebrities or outdoor sports – vaporizer pen supplier Grenko Science has partnered with rapper Snoop Dogg and snowboard manufacturer Burton – or iconic events such as MedReleaf’s recent agreement to sell Woodstock-branded marijuana in Canada.

“There are probably a half dozen brands with some resonance outside the cannabis industry” such as Bob Marley, Snoop Dog, Tommy Chong and Willie Nelson, said David Schnider, partner at legal firm Nolan Heimann. “After them, if you are outside the cannabis industry you don’t understand why they exist or what the relevance is in the first place. The key thing is to be less concerned about being relevant inside the cannabis industry and more concerned about being relevant and transcending cannabis in the outside world. Those are the brands that are going to win.”
For example, retailer MedMen has nearly a dozen locations in California, New York State and Nevada, featuring an Apple Store-like design and advertising that seeks to attract a broader market.

“MedMen doesn’t run ads that say ‘come shop at MedMen’”, Schnider said. “They run ads that say ‘here is our vision of what the world looks like and what the role of cannabis plays in that world. By planting that flag you start being a brand that is going to live and outlast everyone else and that is the critical piece.”

To achieve that critical piece of becoming a lifestyle brand, a licensing deal cannot always be viewed as major source of revenue, but rather a means for establishing your company’s identity, said Chris Fulkerts of Grenco Science. For example, Grenko licensed artist Phil Frost to create designs for Burton snowboards, but also used them for vaporizer pens, luggage and apparel. And in the case of Snoop Dogg, Grenko in one promotion paired the purchase of a Snoop Dogg G Pen vaporizer pen with a free download of the rapper’s Bush album. Grenko purchased about 25,000 albums from the rapper’s Doggy Style Records label, but only 3% of those who bought the vaporizer pen downloaded the music, Fulkerts said.

“Now we are much more strategic, and doing collaborations is about something that is more meaningful and impactful in terms of reaching your target audience,” Fulkerts said. “The crossover we were able to achieve to becoming a lifestyle brand was not just taking Burton’s name and putting it on our pen, but really standing behind something.”
Yet the approach cannabis licensing can vary by region and country. In the U.S., recreational use has been approved in nine states, while 29 states permit it for medical purposes. And in Canada recreational use will be legal on a federal level in June. But the new Canadian law bars the use of celebrity or youth-focused marketing to promote the products. MedReleaf licensed the Woodstock brand in Canada to quickly gain brand recognition and comply with the marketing restrictions, said the company’s Darren Karasiuk during the Licensing University panel.

In the U.S., with the approval for recreational use in California, some companies are weighing entering the cannabis market via licensing as a precursor to eventual federal approval, cannabis industry executives said.
Indeed, Lionsgate is preparing a licensing program for the “Weeds” brand, which was a TV series starring Mary-Louise Parker that ran on Starz from 2005-2012, says Shelia Clarke of Lionsgate. Weeds is being positioned for cannabis and accessory products.

“The legalization in California is what triggered it and we think the brand has some good applications in the cannabis industry,” says Clarke.

Contacts:

Grenco Science, Chris Fulkerts, Founder, 800-948-7480
Lionsgate Entertainment, Shelia Clarke, VP, sclarke@lionsgate.com
MedReleaf, Darren Karasiuk, VP and General Mgr. Recreational, 416-580- 8768, dkarasiuk@medreleaf.com.
Nolan Heimann, David Schnider, Partner, 818-474-5710

Toys R Us Private Label Brands Positioned for Sale, Licensing

Toys R Us’ former private label brands may be returning to retail shelves. Earthbound is representing 10 of them for potential sale or licensing, and hopes to complete many of deals within eight months.

The brands currently are owned by the banks as part of Toys R Us liquidation, but the chain’s private label group has been retained for the time being, headed by former Chief Merchandising Officer Richard Barry. The brands are being pitched to toys manufacturers and other retailers, says Barry.

“You will see the brands on other retailers’ shelves for the holiday season,” says Barry. “It is great to see people’s hard work for all those years will live on.”

The top-selling private label was Koalababy (baby blankets, layettes and bedding), which had about $250 million in annual retail sales, says Barry. A cluster of brands generated annual sales in the $70-$100 range, including Imaginarium (wooden trains, blocks), Fast Lane (die cast and RC cars), Just Like Home (dining playsets) and You & Me (baby dolls, furniture and clothes).

Other brands include Edu Science (stem toys), The Heroes (action figures), Avigo (bicycles), Bruin (bath toys, musical instruments, ride-on cars) and Journey Girls (dolls and dolls clothing).

Contact:

Earthbound, Abe Cohen, Senior Mgr. Licensing and Business Development, 646-873-3820, abe@earthbound.com

Toys R Us, Richard Barry, 973-617-5922, Richard.barry@toysrus.com

Activision Launches Licensing for Overwatch League

One of the areas the licensing community is watching as a potential growth category is eGaming. The global marketplace is rife with a wide variety of game platforms, leagues, teams (many of which compete in several different games) and business models. The merchandise licensing aspect of the business is still very much in the developmental stage.

For its part, Activision Blizzard Entertainment, which debuted its Overwatch League earlier this year through affiliate Major League Gaming (MLG), is moving its merchandise business into a second phase. It will launch an outbound licensing program with the start of its second season in January, expanding what had been a self-sourced, mostly apparel-based assortments that focused on its teams to include categories such as gaming peripherals (keyboards, mice), collectibles and publishing, says the company’s Tim Kilpin.

Activision Blizzard designed and sourced the first season’s team- and player-related hoodies, t-shirts, and caps that are being sold inside at Blizzard Arena in Burbank, where all matches are played. In the first season, which ends with the finals in August, the top-selling items have been name and number jerseys tied to popular players, says Kilpin.

“We think apparel is always going to be important because we have great assets, but we want to expand” and the way to accomplish that is to shift product development to licensees, says Kilpin. “We wanted to move quickly at first and we didn’t want to miss a day of the first season so that is why we kept it inside Activision.”

Among categories being added, gaming peripherals will be an important area. And while much of the initial licensed merchandise will likely be keyed to the teams, there has been a growing interest in individual players, says Kilpin. Activision also is weighing a merchandise program for MLG’s Call of Duty World League, which launched in 2016 and has yet to sell related products, Kilpin said.

Among issues being sorted out is where eGaming goods will be sold, and how soon retailers will determine that it’s time for them to take a position in the business. “Retailers are eager to figure out how to play in this space, but I don’t know that we have a hard and fast plan in place yet,” says Kilpin. “I think we all have some more to learn in how it is going to work locally and how fans are engaging in that across the league. And where the right places are to go from a retail perspective hasn’t been completely figured out yet.”

Contact:

Activision Blizzard Entertainment, Tim Kilpin, Pres.-CEO Consumer Products, tim.kilpin@activision.com

Lionsgate Readies New Licensing Programs for Starz

With the Starz cable channel slated to feature nearly all original content by 2020, Lionsgate is moving to expand its licensing for Starz-owned IP, says Sheila Clarke of Lionsgate.

There were licensing programs in place for “Ash vs. Evil Dead” and crime drama “Power” when Lionsgate bought Starz in 2016, but the studio is including them in a new direct-to-consumer ecommerce store that licensee Connekt is launching by month’s end. The store, which will be based on revenue sharing, will feature third-party licensed merchandise as well as exclusive items sourced by Lionsgate and Connekt, says Clarke.

“Especially with properties that may not have a big consumer products program, this is a way to reach their fans,” says Clarke.

Lionsgate will launch a full licensing program for the sixth season of “Power,” which is being released in June 2019. It also added apparel licensee Isaac Morris for the fifth season, which starts airing July 1. Starz had previously used a mix of agents and internal staff for licensing.

Meanwhile, licensee Parques Unidos is planning to open the first Lionsgate Entertainment Centers in New York and Spain in Q1. They’ll feature a merchandise store along with several themed sections. For example in New York, there will be a “Mad Men” dining/lounge area, a Hunger Games simulator ride, John Wick: Chapter virtual reality ride, Divergent climbing wall and café and Hunger Games-inspired Peeta Bakery.

The entertainment centers come as Lionsgate continues to build out its theme park business. Licensee Dubai Parks and Resorts opened a Lionsgate section in October featuring rides tied to Hunger Games and other Lionsgate films in its Motiongate theme park in Dubai. And licensee Jeju Development Co. is starting construction this year of the studio’s first outdoor theme park in South Korea, with a planned 2020 opening.

Contact:

Lionsgate, Sheila Clarke, SVP Consumer Products and Franchise Management, 310-255-3612, sclarke@lionsgate.com

Sanrio Readying New Strategy for Brands

Sanrio is parting with its “Hello Sanrio” strategy for broadening awareness and licensing of its characters as it seeks to attract millennials to brands beyond Hello Kitty, COO Craig Takiguchi tells us.

The new approach focuses on short-form video, digital gaming, social media and other interactive technology and live events.

“Looking back what we used was the equity of Hello Kitty to introduce the other characters. The thinking was right, but the execution was probably not the right way to go about it,” says Takiguchi. “We are pulling back right now and we need to find ways to bring together this new [consumer] generation, captivate them and use that as way to grow the licensing. It is not licensing first. Licensing is the aftermarket of how the brand is doing. We went so deep before into the licensing business that when it came time to define the brand it was the tail wagging the dog.”

As part of the new effort, Sanrio is readying a food truck, something it has done in past, but this time attaching a trailer to display merchandise featuring Hello Kitty and other characters such as Gudetama, Chococat, Keroppi and Aggretsuko, the latter having debuted at Comic-Con last July and been featured in a Netflix series that started April 25.

The merchandise trailer will contain apparel and home goods, in making stops at retailers, malls and other locations. Goods will feature licensed products as well as those developed both by Sanrio and retailers as part of a DTR. The program will start by this fall, but pick up speed with a national tour in 2019 to mark the 45th anniversary of Hello Kitty, says Takiguchi. Sanrio also recently opened a Gudetama pop-up shop in Los Angeles and plans to expand it to San Francisco later this year.

Contact:

Sanrio, Craig Takiguchi, Chief Operating Officer, 310-896-3262, ctakiguchi@sanio.com

Box Lunch Readying Coraline Capsule Collection

Box Lunch is readying a capsule collection for September that will feature licensed product tied to the Coraline film. Among the licensees that will be part of the collection are Funko (vinyl figures), NECA (puppet reproductions) and Ata-boy (enamel pins, keychains), says Marc Mostman of Striker Entertainment, which represents Laica Studios, which produced the film. The collection is designed to play to consumers who also might be fans of The Nightmare be Christmas, which has become a holiday merchandising staple, Mostman says.

Contact:

Box Lunch, Robert Thomsen, VP General Merchandise Mgr. and Marketing, 626-322-1620, rthomsen@boxlunchgifts.com

Striker Entertainment, Marc Mostman, Partner, 818-225-8355 marc@strikerent.com

Other developments surrounding Licensing Expo:

• With the Angry Birds 2 movie set for release in September 2019, Rovio is readying plans to further extend the franchise after that. Rovio is planning a long-form animated TV series for 2020 and live touring shows targeting China, Eastern Europe and North America, says Simo Hamalainen of Rovio. Rovio will have a stylebook for the new film in August with plans to have licensed product by mid-2019, says Hamalainen. Rovio has signed several licensing agreements for the film, including with Perfetti van Melle (Chupa Chups lollipops) and retail promotional company TCC Group (loyalty program). Many licensees from the first film have signed for the second one. Rovio also weighing expanding licensing to spin-offs of the main Angry Birds game, including Angry Birds Evolution, which was released last year and had a print-on-demand program with Amazon.

• With the pending sale of Power Rangers to Hasbro, Saban Brands is closing its U.S. office in California as the remaining lifestyle business shifts operations to Australia, says a company spokesman. Hasbro agreed to buy Power Rangers and several other Saban entertainment brands (Popples, Luna Petunia, My Pet Monster, Julius Jr. and Treehouse Detectives) for $522 million (Inside Licensing May 1) in a deal that is expected to close later this year. Saban Brands Australia will be headed by Managing Director Stan Wan, who joined the company in 2015 as creative director for the newly formed Saban Lifestyle Brands. The lifestyle business was cobbled together from a series of brand acquisitions in 2014-2015, including Macbeth (footwear), Mambo (surfwear) and Piping Hot (surfwear, surfboards, towels), the latter two largely being sold in Australia and Southeast Asia. Also part of the lifestyle group is the Paul Frank brand, which Saban purchased in 2010 and consists of 150 characters. Still being determined is the fate of Saban’s “Rainbow Butterfly Unicorn Kitty”, which it co-produced with Funrise which was expected to field toys related to the series.

• Build-A-Bear is expanding licensing of its own brand and the newly created Kabu, a newly developed character for which Build-A Bear owns the rights. About 10 Kabu licensees have been signed, including for beauty/cosmetics (Global Brands Group) and fashion accessories (Her Accessories) and plush (Just Play), says Robert Traub of Brand Activation Consulting, which represents Build-A-Bear. Several manufacturers have both Build-A-Bear will carry the licensed products in its stores, says Traub. “With the closing of Toys R Us, Build-A-Bear sees an opportunity to carry more toyetic products. But they don’t want to become a toy store, so they will only sell those that make sense,” says Traub.
• The PBS children’s program Wild Kratts is bringing its show to museums. Licensee Minnesota Children’s Museum is developing Wild Kratts “Creature Power” and “Ocean Adventure” traveling exhibits and has signed bookings for the next three years, says Kaitlin Dupuis of Kratt Brothers. “Creature Power” will debut at the Minnesota Children’s Museum in January, with “Ocean Adventure” slated to open in Boston in February. Minnesota Children’s Museum operates a series of licensed traveling exhibits, including those featuring Curious George and Mattel’s Thomas & Friends. says Dupuis. Wild Kratts is in production for a sixth, 20-episode season, which will air on PBS starting in spring 2019.

Contacts:

Brand Activation Consulting, Robert Traub, Pres., 973-607-1660 btraub@brandac.com

Rovio, Simo Hamalainen, SVP Brand Licensing, +358 50 585 9757, simo.hamalainen@rovio.com

Kratt Brothers, Kaitlin Dupuis, Licensing Dir., 613-686-6497 x239, kaitlind@wildkratts.com