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Licensors Make Time for LTOs

Limited-time offers (LTOs) are a marketing staple, but as an ever-expanding array of brands compete for consumer interest, their importance has grown.

Time-bound promotional deals usually take the form of sales, discount codes, free gifts, and exclusive products. And while their definition hasn’t changed, the categories they target certainly have.

Long championed by apparel collaborations where the more unusual the limited pairings were, the better—streetwear brand Supreme has worked with the likes of Rimowa (luggage), Fender (guitars), and Everlast (boxing gloves), for example—LTOs are now being embraced by new categories, including furniture, wallpaper, and lighting.

High-end furniture supplier Abner Henry, for example, recently launched presales for a collection with The Metropolitan Museum of Art. It’s limited in quantity—490 units spread across seven pieces (70 pieces each), which will ship to consumers later this year—and borrows from the museum archives with designs based on artworks and artists.

In addition to featuring limited SKUs, this range also plays to a limited audience consisting largely of interior designers selling to clients at prices ranging from $54,428 for the Verlang 50-inch round coffee table based on Van Gogh’s 1887 painting “Sun Flowers” to $144,200 for the Pirouette glass topped console table inspired by artist Edgar Degas’s 1874 work “The Dance Class.”

“LTOs can be a profitable way of marketing a brand and it’s a way to create a special experience for your audience,” said Bill Graham, Chief Business Development Officer at collectibles supplier PhatMojo. “It’s buying something that is collectible and whether that is investing in it because it’s an asset class or they are a super fan, there are a variety of reasons for getting into it.”

More companies are making use of LTOs, Graham said, because it’s a tool that provides “VIP access,” something that has become crucial in raising brand awareness in a crowded market.

In the case of The Met, the Abner Henry furniture range also serves as a proof of concept in demonstrating the types of products that can be developed using the museum’s art assets, said Josh Romm, Head of Global Licensing and Partnerships at The Met, who previously developed a licensing program that paired Ducati motorcycles with the Warner Bros. film The Matrix Reloaded.

“This delivers a message out there in terms of what can be done with The Met’s brand and assets, and what we can bring to the table if we can deliver this in the furniture category,” Romm said. “This collection has a recurring benefit and annuity to everything else in our licensing program.”

Online LTOs are frequently accompanied by ticking clocks, underscoring for consumers the need to take action to buy the product before time runs out. This encourages immediate action, but can also make consumers aware they were being marketed to, which may carry a downside, said Jillian Hmurovic, Assistant Professor of Marketing at Drexel University, in the report Examining the Efficacy of Time Scarcity Online Marketing Promotions in Online Retail.

“We compared how much online and offline shoppers would be willing to pay for a product promoted with versus without time scarcity tactics,” Hmurovic said. “Offline, the time scarcity promotion increased how much shoppers were willing to pay for the promoted product, but online it had no effect.”

And while the specific marketing strategies may evolve moving forward, it’s clear that these timed promotions have been embraced by licensors, said Linda Morgenstern, VP for Brand Management at Beanstalk.

“There was a time when licensors didn’t want to be associated with that [time clock], but that is now being done a lot because it engages people and gets them to put in their email address,” which can be used for marketing, Morgenstern said. “There are things that are emerging because of online shopping that I don’t think would have passed muster with licensors before.”

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