The '80s Revisited

According to a Harvard/Yale study sponsored by LIMA, the trade association for the licensing industry, four categories — entertainment, corporate, fashion, and sports — dominate the licensing market, accounting for 93 percent of royalty revenues. And while overall revenues have shown a slight dip with the slowing economy, two categories, Art and Cause-Related licensing, have posted healthy gains of 4 and 5.5 percent respectively.

"The industry remains strong, and is increasingly regarded by many companies as an important and powerful tool in their marketing mix," said Charles Riotto, LIMA president.

The quest for new trends in licensing continues apace. At last summer's International Licensing Show in New York's Jacob K. Javits Center, licensors were out in full force (more than 18,000 exhibitors from over 70 countries), planting seeds of marketing concepts that will take root in the fertile field of consumer marketing for years to come.

In these uncertain times, Americans are looking toward home and family to help buoy their sense of personal security. Likewise, familiar images and names that highlight the comfort of safer, simpler times have a strong appeal with consumers of all ages. The trend toward memorabilia that emerged in 2000 remained very strong at the Licensing Show, as nostalgic images continued to reappear across all categories, gracing all kinds of merchandise, from apparel and tableware to furniture and toys.

Yet, while in recent years such established icons as Barbie, Winnie the Pooh, Mickey Mouse, and Lionel trains have formed the backbone of the trend toward nostalgic marketing, this year a new crop of figures from the past has begun to make its mark. Eighties pop culture icons such as ALF, the Care Bears, Masters of the Universe, Smurfs, and Strawberry Shortcake are making a comeback in the 21st century. The new trend is aimed in part at Gen Xers, who, like their parents before them, remember fondly the images of their youth, and want to share their favorite characters with their own kids.

According to American Greetings, makers of Care Bears, "the characters are in demand with two distinctly different groups of consumers: parents who fondly remember the Care Bears they grew up with, and teens who are embracing icons from the 80s for their hip, 'retro chic' appeal." American Greeting will roll out a wide variety of licensed Care Bears products through summer 2003, including everything from toys and apparel to linens and bedding.

The events of September 11 helped focus Americans on the value of helping one another, and the licensing industry has followed suit with a significant increase in Cause-Related licensing. Representing this trend at the Licensing Show were first-time exhibitors such as the NYPD, the U.S. Secret Service, the National Parks Foundation, and the First Flight Centennial, celebrating the centenary of the Wright Brothers' Kittyhawk flight.

Also debuting at the 2002 Licensing Show was the FDNY Fire Zone, featuring the license of the New York City Fire Department. In response to the huge demand for its identity on products, the FDNY embarked on a major licensing program, including a new set of Rescue Heroes FDNY products from Fisher-Price.

"When people see the FDNY logo, they think of bravery, brotherhood, and sacrifice," said Marjorie Morris, director of licensing for the FDNY.

All monies raised by the FDNY from sales of licensed products go to the FDNY Fire Safety Education Fund, which sponsors fire prevention programs and provides smoke detectors to low-income families.

Entertainment licensing, which accounts for about 44 percent of the industry's annual royalties, again provided some of the flashiest booths at the Licensing show, with Warner Bros., Sony, Universal, Viacom, and Disney all trotting out the latest of their motion picture and television properties. Whereas many licensors are reaching into the past to resurrect past icons, the entertainment giants are concentrating on extending their brands into the future, with a large crop of sequels dominating the movie industry. With such hot franchises as The Lord of the Rings and Harry Potter lighting up the screen this fall, and the next installments of Spiderman and Charlie's Angels set for next summer, the studios will be presenting their hottest properties to manufacturers in all categories.