Studio Approach To Licensees Puts Quality Before Quantity - motion picture merchandising

DSN Retailing Today, June 4, 2001 by Doug Desjardins

In the halcyon days of licensing, when the retail landscape was littered with Lion King merchandise, bigger was always better when it came to putting together licensing packages for major theatrical releases. These days, though, the studios are finding it pays to be more selective in a market that's changed and matured.

Warner Bros.' approach to its marquee holiday film "Harry Potter and the Sorcerer's Stone" is a good example. The film, based on the popular J.K. Rowling book, is sure to clean up at the box office and produce a slew of sequels. Yet Warner executives have been low-key in packaging licensed product.

"We've done quite a bit of licensing, but it's been more careful and controlled," said Karen McTier, executive vp of domestic licensing for Warner Bros. Consumer Products. "We've closely monitored the type and amount of products that have been manufactured, and we're going to closely monitor the amount that's going to be put out there because we don't want to over-ship."

Warner Bros. will arrive at the International Licensing Show in New York City June 12 to 14 with about 85 licensing partners for Harry Potter, including Hasbro and Electronic Arts. It's a large list, but it's nothing compared to the packages Warner put together for major titles just a few years ago.

"For some of the Batman films, we had 150 to 175 licensees and more than 100 for 'Space Jam,"' recalls McTier. "But that's just not done anymore. We see Harry Potter as a long-term franchise, and we want to make sure the merchandise is true to the books and the films."

Sony Pictures is taking a similar approach to its feature film version of "Spiderman," which will hit theaters in spring 2002.

"We're not licensing 'Spiderman' as broadly as we would have in the past. In the end, we'll probably have about 50 licensing partners," said Al Ovadia, executive vp of Sony Pictures Consumer Products. "We're planning two additional films and an animated series four to six months after the film is released. So we don't want 100 licensees flooding the market with product because it gets confusing."

Marvel Enterprises, which owns the rights to the original Spiderman character, is teaming up with Sony to license merchandise for the film. Marvel's Russ Brown agrees that it's important to pick and choose licensees based on what's likely to work best at retail.

"Just because you have 2,000 products that could be licensed doesn't mean you should license them," said Brown, senior vp of consumer products, promotions and media sales for Marvel. "Functionality is important, but there should be some kind of natural connection."

Sony is also planning a short list of licensees for its summer 2002 sequel "Stuart Little 2." Hasbro has already agreed to be the master toy licensee, and Sony is in the process of signing on partners in a dozen other categories.

Ovadia said the new approach Sony and other studios are taking is a reflection of a market that is still recovering from overkill. After the success of merchandise from "The Lion King" blew the market wide open in 1994, other studios jumped on the bandwagon and flooded stores with product for film after film. By the late 1990s, oversaturation and a few notable flops cooled retailers' interest in movie-related merchandise and forced studios to rethink their strategy.

"The reality is that the marketplace has changed," Ovadia said. "Now, the idea is to put a reasonable amount of product out there and make sure none of the categories overlap or get confused with others. If you put too much product out there, you'll probably end up shooting yourself in the foot."

Twentieth Century Fox has a wide range of merchandise heading to retailers for the July 27 release of Tim Burton's remake of "Planet of the Apes." Like other studios, Fox partnered with a relatively modest number of licensees for the film, including Hasbro, for a new line of toys.

"We have about 80 partners, and it's a really full program," said Jennifer Robinson, vp of sales for Fox licensing and merchandising. "We covered what we needed to cover without going too broad because we realize that going broad doesn't necessarily mean additional sales."

Robinson said Fox will be at the show looking for new licensing partners for the video release of "Planet of the Apes" and shopping its newest property "Ice Age," an animated adventure featuring the voice of Ray Ramano as a woolly mammoth and Denis Leary as a saber-toothed tiger. The film is scheduled for a spring 2002 release.

"We'll have screenings of the work-in-progress," Robinson said. "We've had a few already, and we've got great feedback."

Viacom Consumer Products put together one of the largest licensing packages of the year for "Tomb Raider," which will be released June 15. The film version of the popular video game features Angelina Jolie as Lara Croft and has more than 100 licensees behind a marketing program that targets teenage girls and boys.

The week of the licensing show, Viacom will be busy promoting the latest installments in one of the most enduring franchises in entertainment history.