Dinos, sports lead licensing in '93 - dinosaurs

Discount Store News, June 21, 1993 by Jill Lettich

Sports teams and dinosaurs are the unlikely partners that may recharge the licensing business in 1993 and help recapture the 2% of the business lost last year - if retailers can get the properties in their stores.

"Jurassic Park" and Barney the dinosaur are among the strongest new movie and character licenses introduced since the Teenage Mutant Ninja Turtles held court. With them, a continuing interest in sports licensed apparel is likely to keep cash registers humming nicely throughout the year. Many discounters, however, are reporting discrimination as some licenses are focusing on upstairs distribution causing a rift in an already difficult market.

In 1992, total sales of licensed properties in the U.S. were about $62.2 billion, down 2% from $63.5 billion a year earlier, according to The Licensing Letter.

Brands and trademarks continue to be the properties generating the most sales, accounting for $21.9 billion, and 35.2% of all licensed sales. Sports licenses, however, showed the biggest jump in market share. During 1992, sales for sports licensed goods went up 9% to $12.1 billion.

Television programs, cartoon characters and theatrical films showed the largest decline. That may be remedied, however, since the release of "Jurassic Park" and its planned fall cartoon series. In addition, plans for a live action movie based on The Flintstones is also likely to revitalize that license.

Despite these new and exciting introductions, most observers agree that the licensing business in general has plateaued. The business has remained in the $60 to $65 billion range since the late 1980s.

This performance has made retailers and manufacturers cautious and it has made it very difficult for new properties to establish themselves.

"Business is getting tougher; the economic recovery has not arrived in the licensing business," said Woody Browne, president of Building Q, a marketing company specializing in licensing. "Retailers are more selective, making manufacturers more selective and it makes it difficult for a new license to break through."

The selectiveness may be changing the way some licenses do business with mass merchandisers.

The high volume of the mass changing the way some licenses do business with mass merchandisers.

The high volume of the mass market is generally a big draw for many licenses, especially children's properties. Licensing actually was well established in the mass market, before it moved upstairs. Now, however, a tougher business climate has made licensing companies careful about flooding the marketplace.

One of the best current examples of this tug of war is Barney, the purple dinosaur featured on public television stations. The Lyons Group, which owns thee license, has so far limited its apparel licensed goods to manufacturers serving department and specialty stores, while mass merchandisers are left with onLy a screen printed T-shirt an underwear for their apparel customers.

"We could do three or four times the business if we had more product," noted Hans Leernick, girls' buyer, Stuarts. Leernick reported healthy pales for the Barney accessories that are in Stuarts stores now, but wishes more apparel was available. Though the Lyons Group reported it may introduced some apparel to mass merchants further down the road, Leernick noted, "I've seen licenses come and go; I want it when it's hot, not a few years later."

Mass merchandisers, however, can take refuge in sales of sports licensed-merchandise, which continues to grow steadily. In fact, this month's Licensing Show in New York includes a large contingency of both major sports associations, manufacturers and athletes.

"This is the first year in which sports licensing will have a stronger presence at the show," said Susan Reuter, show director, Expocon Management Associates, which produces the Licensing Show. Among the new exhibitors are heavyweight champion Riddick Bode, Fila. Rawlings, Reebok and the U.S. Olympic Committee.

Other sports related exhibitors at Licensing '93 include Brian Hakan Associates, licensing agency for ABC Sports, which will launch a new program for the National Association of College Basketball Coaches, and Meadowlanders Inc., a license for the four major sporting leagues which manufactures plush bears dressed in team uniforms.

For retailers attending the show, it is not all dinosaurs and sports. Among the exhibitors:

* Warner Bros. will showcase its successful Looney Tunes characters, which have become a hit with adults as well as children. The company also acquired the rights to Mad Magazine, which is now featured on ties and other items.

* Accolade will feature Busby Bobcat, the video game character that is branching out into television.

* Farmer's Almanac is expanding its products and will show new lawn and garden products such as African Violet mix, horticulture sand and charcoal, Canadian peat moss, decorative bark, hanging basket and patio pot mix, as well as other products.

* Twentieth Century Fox will show merchandise from its television properties: "Class of '96," "Once Upon a Forest," "The Beverly Hillbillies" and "The Pagemaster." It will also show its Alvin & The Chipmunks merchandise.