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The Licensing Lookout: He’s gone to Iceland…

Start Licensing’s Ian Downes finds there’s much more to Iceland than frozen food this week.

I visited Iceland this week. Not Reykjavik, but Worcester Park. I took a tour of my local Iceland branch. It seems to be a retailer that is performing well and a retailer that has created a strong identity. It is one that I have followed for a number of years, to the point that I read company founder Malcolm Walker’s autobiography and watched the ‘fly on the wall’ series that followed Iceland’s progress. I think it has always been licensing aware – I remember taking a trip to the HQ in Deeside about 20 years ago to discuss a licensing opportunity. I think it was a confectionery range. An early sign that Iceland is more than a frozen food retailer.

Iceland is PR savvy and use media well. A recent campaign focusing on its decision to stop stocking products containing palm oil attracted wide scale publicity, some of which was negative, but it certainly demonstrated commitment to a course of action and followed this through. The planned TV advert around the issue was banned, but according to Iceland it has now had over 70 million views online. I suspect at the consumer and operational level this style of management is effective.

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I think Iceland is still switched onto licensing, but pick and choose its moments. I think another strand to the strategy is being well tuned into the retail seasons and stocking appropriate products at the right moment. With this in mind, it was interesting to see a Michelin-branded FSDU stocked with products such as de-icer, screen wash and ice scrapers. Iceland is a price-led retailer and these products were keenly priced. A good use of a classic motoring brand and the associated iconic brand character Bibendum. The brand will reassure consumers and, coupled with the price offer, I am sure it will be a compelling offer for customers. I suspect Iceland know when to get in and get out of products in a swift and efficient way.

Clearly Iceland is linked to frozen food and this is a central plank of its offer – although there are well stocked fresh food shelves, chiller cabinets, alcohol, bakery goods and tinned goods. Interestingly, I noticed a few special offers for small electrical appliances – again I suspect Iceland takes advantage of good offers from suppliers and keeps an eye on consumer trends.

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Within the frozen food offer there are two very significant partnerships which I assume are direct to retail licences that are exclusive to Iceland. Both are well chosen ones and seem to be a good fit with the customer base. Both have been in-store for a while which suggests they are successful.

The first is a range of ready meals developed in association with Slimming World. This range seems to have grown – a sure sign of success and also a reminder that a long-term approach to licensing works.

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The other is a range of frozen products using the Greggs brand. Greggs the bakers is itself doing well and it is quite enterprising of both retailers to create a brand licensing partnership of this kind.

For Greggs, Iceland gives it additional reach and in a sense turns it into a 24 hour brand – consumers can take their favourite Greggs products home and consume them at their convenience. Iceland has tapped into the popularity of a brand that has great awareness and good high street presence.

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Licensed products do feature elsewhere in store but in a light touch way. Iceland offers a lot of top brands which consumers will be familiar with and again there is an emphasis on value. Brands dominate the shelves so it is hard for licensed goods to squeeze in. One noteworthy example was a range of Costa Coffee products including ground coffee distributed by All About Food. Here again I think Iceland is backing a high street brand that consumers recognise and trust. A solid strategy.

There was also a new version range of brand extensions from Mars in the biscuit aisle including some new products, Twix Soft Centres cookies. While I believe these are developed by the brand owner, I suspect licensing has helped with this NPD as brands like Mars and Cadbury work with licensees in the bakery category in areas like part baked cookies. This is a good reminder that licensing can help brand owners investigate and trial new categories which they can then build on with their own developments.

Iceland is a great example of a retailer that seems to be very focused and understands its consumers well. It appears to be licensing ready, but on its own terms and in a selective way. A good case study for other retailers. Licensing can be a great asset to retailers when used in a strategic and consumer centric way.

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Outside of Iceland I spotted an old ‘favourite’ on the comeback trail this week. Mr Blobby is being used by Tesco as part of a poster campaign celebrating its 100th anniversary – under the strap line Prices That Take You Back, which is celebrating Tesco’s commitment to value.

This might be the time to dust off those old Blobby style guides. Maybe Mr Blobby should follow Noel Edmond’s lead and go into the jungle next year. If he does, who knows, he might even get to work with Iceland!

Ian Downes runs Start Licensing, an independent brand licensing agency. His Twitter handle is @startlicensing – he would welcome your suggestions for what to look out for.

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