Licensed products for adults stir sales in kitchen, dinnerware

Discount Store News, June 19, 1995 by Joseph Dobrian

NATIONWIDE DSN REPORT -- Licensed housewares and dinnerware are making a major impact on the retailing scene, and manufacturers and licensing agents agree that this is an ideal category for the discounter. The merchandise is high-profile, generally low- to medium-priced, with much better margin and turn than generic housewares and dinnerware.

For 1994, retail sales of all licensed housewares in the United States and Canada were $2.33 billion; in 1993 the figure was $2.18 billion. That's an increase of 7%, compared to a 5% growth for all licensed products.

Perhaps the most welcome change in the licensed housewares business lately has been the emergence of products aimed at adults. Until recently, the business was largely restricted to children's dinnerware. Today, the category is expanding into kitchen appliances, textiles and even wall coverings.

Phil Kash, vice president at Equity Management, reports a warm response to General Mills' Betty Crocker kitchenware program.

"This program includes small appliances, bakeware, cutlery, storage containers and kitchen gadgets," he told Discount Store News. "It takes advantage of what Betty Crocker means to the consumer, which is high quality, value and the knowledge that all products have been tested by Betty Crocker Kitchens.

Both General Mills and the licensing partners are developing promotions. In some cases they use cookbooks as gift-with-purchase preminums. In some cases, coupons for Betty Crocker/General Mills food items are tied in.

The U.S. Postal Service is another recent "name player" in the licensing game, according to Deborah Joester, president of Hamilton Projects, New York.

"We're moving into ceramic decorative kitchenware, kitchen tiles and home textiles with the U.S. Postal Service," she revealed. "Eighty to 100 new stamps come out every year, and we have a number of programs incorporating these designs into collectibles, covers, plates, figurines and Christmas ornaments."

"New stamp issues are real events," she noted. "Each new stamp gets national coverage, including significant TV support when a stamp is initially released."

Joester added that Hamilton Projects will launch another highly recognized licensed property for adults with a big promotional push this summer.

Ellen Brown, director of account services at New York City-based Beanstalk Group, has high hopes for a line of products based on package designs from Celestial Seasonings teas.

"Celestial Seasonings is doing a line of mugs, canisters and dinnerware items with Sakura dinnerware, which was just shown at the Gourmet and Housewares Shows," she said. "We'll be shipping this summer. We'll be talking with a textile firm about doing a line of kitchen textiles for Celestial, including placemats and tablecloths. We're also talking to a major teapot company."

Why are brand names suddenly so fashionable as licensed properties? According to Brown, it's because "people are tired of the character licensing that's been so prevalent in the past five years. Adults want to go to the next level."

NFL Properties, long associated with products for boys, is now moving into the adult market, according to Ann McDowell, director of retail licensing.

"We have an extensive home products program, including silverware and mugs, kitchen textiles, wall coverings, furniture, clocks, home office products, wastebaskets, gifts and accessories," she said.

Karen Raugust, executive editor of The Licensing Letter, pointed out that designer licenses are gaining popularity. Ralph Lauren has been in the dinnerware and kitchen textiles business for some time; Calvin Klein has just entered it, and illustrator/designer Mary Engelbreit's designs have been popular for years.

Raugust added that selling licensed products is a great way for the retailer to encourage impulse purchases of a whole set of items.

"One of the things about a licensed product that differentiates it from in-house designs is your ability to cross-merchandise," she said. "If you're selling, say, NFL-logoed mugs, you can combine them with other products like kitchen textiles, salt and pepper shakers, cookie jars--creating a 'concept corner' is a great way to generate sales."

Most licensed products come with a good deal of built-in support from the licensor, the manufacturer, or both, she pointed out.

"If you make Looney Tunes dinnerware, the Warner Brothers people will likely have been to the retailer before you, discussing ways to promote the product, so you're not alone anymore. Licensees are working together more now to coordinate, say, dinnerware with kitchen textiles, to sell them together and create joint promotions or even cross-packaging."

At Hallmark, marketing services executive Chris Brown agreed with Raugust on the benefits of cross-merchandising. "It drives up the total transaction by allowing people to buy impulsively, and it lets the consumer see how the products work together," she said.

Brown added that Hallmark is making a big push with its Crayola Home program, which includes bedding, bath products, lighting, party goods, infant goods, laundry accessories, Back-to-School items, director's chairs and melamine dinnerware sets with the Crayola logo.