Strategy shifts to building brands out of properties

Discount Store News, March 17, 1997 by Robert Scally

Increasingly in Hollywood, a studio is only as successful as its brands.

The major entertainment companies have taken films and television shows, as well as books and literary characters, and turned them into lines of merchandise that can live for years or be used as part of event marketing to draw attention to a blockbuster property.

Executives in the consumer products divisions of Hollywood's top studios said that the see a bright future for properly managed brands and that licensing of entertainment products will find its way into numerous new markets.

Sales of licensed entertainment-related products in mass merchant outlets show no signs of flagging and will likely grow in the near future, said George Jones, president of worldwide licensing for Warner Bros. Consumer Products.

Jones said that Warner sees significant opportunity in products for infants through its new Baby Looney Tunes line that is being rolled out this year and in sporting goods via the WB Sport line.

"Our focus is on key mass market stores and that remains our preferred channel of distribution and will for the foreseeable future," Jones said.

Many Hollywood executives agree with Jones.

"In our particular division at Universal Studios we've seen a dramatic growth in sales of licensed merchandise at retail during the current decade, especially in toys," said NancyJane Goldston, senior vp of marketing and merchandising at Universal Studios Consumer Products. "We see this as a positive trend, and certainly event films have played a major role. The consumer has gravitated to event films that are focused on brands."

Major Hollywood film studios and retailers such as Target and Wal-Mart have long used event-driven marketing that surrounds the home video release of blockbuster films such as "Independence Day" or "Jurassic Park."

"Another component that has grown is the licensed fashion, apparel and accessories market. We definitely feel there's a lot of strength in that area," Goldston said.

Collectibles relating to Universal films are also a growing area, she said.

Universal Studios, which recently changed its name from MCA/Universal, is taking its branding efforts to new territories to promote its own name as brand. "This is part of our overall corporate strategy to develop brands, and what could be a better brand to develop than Universal Studios?" Goldston said.

Universal will take a step into retail later this year with the opening of its new Universal Studios stores, a chain that will begin with a prototype location at Universal City Walk in California. Other new means of promotions, such as the sponsorship of NASCAR auto racing, are also in development.

Although some consumer products executives said they think that mass merchants have been flooded with entertainment-related merchandise for the past couple of years, they note that there's always room for great products developed around a hot property that is properly managed.

Licensing has to be carefully approached, and products that make sense of the property and would have strong appeal to the audience for a given entertainment property should be developed, said Debbie Petrasek, vp of strategic property development at Viacom Consumer Products.

"The days of just slapping a logo on a toothbrush are over," she said.

Although retailers have been burned on some new brands in the past, both retailers and the studios still take chances on new properties and products. "You never know what's going to catch fire," Petrasek said. "It can even start with a particular item."

Tiger Electronics, the master toy licensee for electronic products from Viacom's "Clueless" television show had a hit with a Clueless electronic organizer that recently sold well at Wal-Mart. Electronic fashion and makeup organizers and a hands-free telephone that has prerecorded messages (in Valley-girl-speak) were shown by Tiger at Toy Fair and are expected to hit store shelves in May, with a major merchandising campaign set for September, Petrasek said.

Retailers themselves have gotten better at asking questions about brands and finding the kinds of products that they think will sell.

Different retailers also use entertainment-themed brands for short-term campaigns.

Target has successfully used entertainment products to help build traffic during various seasons, said Neil Newman, a Viacom vp of strategic property development who handles the company's most established brand, Star Trek.

"A lot of [entertainment] licensing has become more promotional," he said.

Two recent Target seasonal promotions were centered around the home video release of Walt Disney's live-action "101 Dalmatians" for Valentine's Day and Scholastic's "Goosebumps" book line last Halloween.

The promotions reached into numerous departments from candy and books to apparel and linens.

Some entertainment properties need branding just to be able to compete with the big blockbusters, said Christina Nix-Lynch, manager of marketing for Scholastic Properties. Scholastics Magic School Bus line, currently celebrating its 10th year as a book property and its third successful year as an animated show, is being revamped with brighter, more eye-catching packaging for its video products in an effort to raise the line's profile.