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Value added… it’s this week’s Licensing Lookout

Start Licensing’s Ian Downes takes a trip down Old Kent Road this week and discovers how B&M is handling licensing in-store.

This week I swapped the bright blue skies of Malta for the rather more grey and grimy outlook of the Old Kent Road. To fulfil my Lookout duties I popped into a B&M Bargains superstore on my way to see Millwall on Saturday.

Discounters – aka value stores – are a core part of the retail landscape these days. Indeed John Lewis ceo Sharon White made the observation recently that more consumers are shopping in discounters and that this is adversely impacting retailers like John Lewis. To reinforce her point I remember quite a few times seeing shoppers filling Waitrose bags with ‘bargains’ they were bagging in Poundland.

Consumers are getting more cost conscious for sure, but that said in inner city areas like Southwark where the Old Kent Road is located that has arguably always been the case. Round the corner from the Old Kent Road, East Street market still operates with people buying fresh produce, packaged goods and clothing from old fashioned stalls. In this context managing your shopping within a budget is a fact of life.

Licensor, licensees and agents have been working in the value sector for some time and this sector is very much part of the licensing landscape. Indeed supermarkets have ranges available at a range of budgets including value ranges.

LL1My first impressions on stepping into the Old Kent Road branch of B&M was that a lot of consumers were bargain hunting – the store was busy. The shop itself is a large format one with lots of different departments including DIY, toys, gardening and pet products, but it’s core offer is food and drink. From a supplier point of view, retailers like B&M can provide a valuable route to market and seem to support new product launches. In a retail market which often sees retailers reducing their supplier base, I imagine the opportunity to work with a retailer which is looking for new products is an attractive one. Likewise retailers like B&M can be a welcome outlet and ally in clearing stocks.

LL4Licensing featured throughout the store. A great example of a long-term licence that continues to have a market presence is Ainsley Harriott’s range of Cup Soups – my research suggests this range first launched in 2009. Alongside this range were Batchelors’ Cup A Soup products featuring an on-pack promotion for the film Shazam: Fury of the Gods.

Bachelors is a brand that dips into the licensing sector through promotions and seemingly enjoys success with this strategy as it is a repeat user of promotions.

LL5Noting my earlier point about value retailers being supportive of NPD, it was interesting to see Millions and Slush Puppie Milk Straws. Milk straws add flavours to milk and in this context it is easy to see the attraction of brands such as Slush Puppie and Millions to the category. From a brand owners perspective products like this allow them to broaden their presence in-store and they also give them a novel way of extending the taste experience of their brands. This helps them stand apart from their competitors.

In a similar context it was interesting to see Kellogg’s Crunchy Nut Peanut Butter. This product is produced by Duerrs and was launched in 2020. From B&M perspective products like this one allow them to tap into the brand awareness and trust that Kellogg’s has. I am sure it is keen to provide its consumers with a variety of ways of buying well known brands.

Slush Puppie was also represented in-store with a strong presence for Slushie Machines and Syrup sets. This range had an end cap in-store and seems to be a range that has performed well across a variety of retailers. It is worth noting here that suppliers have to be mindful of how and when they work with value retailers in regards to its impact on retail pricing and their relationship with other retailers. Increasingly suppliers and rights owners have to take an omni-channel approach.

LL6Thinking of the cereals and the cereal category, this is one that is very tough to break into with new product, not least because brands such as Kellogg’s, Weetabix and Nestle are so well established in it and are also proactive within it. Against this backdrop it was noteworthy to see a number of licensed cereal brands on shelf in B&M suggesting that it is a retailer happy to support NPD within the category and to give new suppliers a chance on shelf. Licensed ranges on sale included a Millions Strawberry Crunch, Back to the Future Multigrain Chocolate Balls and Jaws Multigrain shapes. It was also interesting to see a range of granolas marketed under the Mo Health range – athlete Mo Farah’s brand. In another part of the store there was also a range of electrical goods such as an Omelette Maker.

LL7Rather like I saw in my Maltese shopping experience, Easter was a feature of B&M’s offer with a variety of ranges of Easter eggs on sale. These included big brand names but there were also some examples of licensing on show including Cadbury’s Peter Rabbit eggs (these seem to be performing well across the market judging by their visibility in a range of retailers), plus Kinder Surprise Eggs featuring Avatar and Miraculous. There was also a range of PAW Patrol milk chocolate eggs with a surprise (a mini collectable) from Zaini.

An Italian company, Zaini’s presence in-store is a reminder that in categories such as confectionery licensing is increasingly a global business and that retailers are looking further afield for bargains.

LL2A stand out was a range of Garfield cat toys, treats, cat litter and milk. The pet sector is a very competitive one and is dominated by big brands. It is a tough one to break into. The Garfield range appears to be one developed directly by B&M and I am guessing it liked the fact that it could create a value-orientated range that had a distinctive brand identity. Garfield provided it with a creative way of competing in a core category and also delivers fun to a category that can be quite conservative. It is a path that others have taken over the years and I remember Sylvester being used as a brand in cat litter some years ago. Of course, a challenge for character brands in this category is competing with the established pet care brands and also establishing trust with consumers. Working with a retailer like B&M allows the brand an entry point into the market and guarantees a route to market.

It was also interesting to see a presence for licensing in categories like greeting cards and personal care.

LL3B&M has a fairly large amount of space given over to toys and games which not unexpectedly feature a lot of licensed ranges. A particular stand out was Peppa Pig – B&M is supporting Peppa with a lot of space and a deep range of products. In the context of toys Peppa Pig is a toy brand that consumers trust and recognise rather like Kelloggs in cereal – for B&M it is a great brand to have on board. The retailer is also backing a range of classic brands in the toy category including Fireman Sam and Postman Pat. Brands that are well established, clearly communicated and recognised by different generations (thinking about gift purchasing). Furthermore, product formats included big box style products with open packaging featuring a number of component parts that play well to the ‘value for money’ mantra of B&M. It also had LEGO Star Wars sets and Dr Who collector sets. It was also selling outdoor and activity toys including wheeled toys such as Sonic the Hedgehog scooters.

Overall it is clear that licensing and licensed brands hold an appeal to B&M and its consumers. Licensed brands are ones that consumers recognise and trust. They hold an appeal in the value sector and, for consumers, B&M is a way of accessing licensing in a value for money context. They are also brands that help the retailer build footfall and bring people into store. From a rights holder point of view, the value sector has provided a new route to market which is particularly useful for new product launches and an opportunity to work with new licensees. As noted earlier, it is important that licensors developed an all channels retail plan and recognise that the retail landscape has changed. As the Garfield range shows, this sector also opens up opportunities to bring ideas to the market that perhaps had previously closed off due to the strength of established brands.

For the record, Millwall presented their opponents Huddersfield Town with a very generous special offer on Saturday – gifting their visitors three points – Huddersfield and their fans got full value from their trip down the Old Kent Road!

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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