Execs from The Entertainer, Viacom, Universal, VTech and Moose Toys on overcoming the sector’s challenges.
During a panel discussion at Brand Licensing Europe yesterday (October 1), executives explored the recent decline in licensed toy sales, the challenges faced in the market and how they can be overcome.
Earlier this year, the fifth Annual Global Licensing Survey by Licensing International, showed that licensed toys had suffered a 2.1% decline in sales in 2018.
Stuart Grant, buying director, The Entertainer, explained at yesterday’s panel – entitled How can toy licensing recover its sparkle? and moderated by ToyWorld publisher, John Baulch – why he thought sales were falling: “As a retailer, there is so much content for us to focus on. And if you look at the child and the way they are consuming their content now, there is just so many different touchpoints and gone are the days where kids are completely wholly obsessed with one brand.”
The claim of the proliferation of new properties was, however, countered by Hannah Mungo, country director consumer products, UK & Ireland, NBC Universal: “I think there are 47 new properties on the market this year, compared to just about 40 last year. But we got some analysis from NPD, and if you take out one major licensor from the equation, the actual share is pretty much the same as it was in 2016.”
Licensee Lucy Wynn-Jones, head of licensing Europe, Moose Toys was careful to bring a true market reflection to the table: “Even though the share might be down, there are still some real winners that are out there – L.O.L., PAW Patrol – that are still enormous, and people tend to forget those when they are talking about the decline of licensing.”
The way in which children consume media was a big topic of conversation. With so many more options, the execs believed it more challenging to create successful brands.
Mark Kingston, svp international consumer products, Viacom International Media Networks commented: “To get time with kids at the moment when they have so many different touchpoints, it all comes down to emotional connection. If your properties have that real emotional connection with the audiences and with the kids, it then translates into consumer products.”
Pricing remains a challenge in the consumer products market. Andrew Barrett, director of product development, VTech Electronics Europe, however, believes consumers willing to pay remain: “If the IP is strong, it can command a premium. How much? Often that will go back to what the product is. So we look for product innovation with our licensed IP, and if you can have product innovation on a licensed character, you can probably go up to a premium of 30% maybe.”
Looking forward to where the industry is likely to be in a year or two, Hannah sees opportunity in digital: “I think we’re going to see more and more a YouTube first approach, because so many kids are tuning into YouTube and it has the biggest number of eyes. I think YouTube is going to be a platform moving forward that CP can hang off the back of.”
And Mark predicts a full 360 in terms of how programming is delivered: “I think appointment to view is going to come back. One of the challenges that we see with some of the SVOD platforms at the moment is that when they drop a whole series in one go, then they’ve got to wait six months or a year for the next season to come along. That doesn’t allow them to build that emotional connection with the characters to really then want to play with the toys and wear the clothes.”