ILP: You’ve been at the helm of Zee5’s international foray into 190 countries across the globe barring China and the US. Tell us about some of your early learnings.
Archana Anand (AA): It’s very early days yet as we’re just getting started with our campaigns but we’re seeing some superb traction so far. We launched our brand campaign ‘Dil Se Desi’ in November, officially announcing our arrival in APAC, MENA and Africa. This campaign taps into the insight that Indians and South Asians today, wherever they are, are fundamentally rooted in and proud of their culture, and are ‘Dil Se Desi’.
Our campaign vibrantly celebrates this emotion and has been wonderfully received among the South Asian diaspora across countries. We’ve also announced some key partnerships like Netrange, Zeasn etc that will help us reach millions of viewers across APAC, MENA and Africa. We have several more such partnership announcements lined up over the next few weeks. Our sponsorship of Northern Warriors as a new team in the Sharjah T-10 league helped us gain a lot of visibility, especially as they went on to win the tournament. We have a lot of exciting plans and announcements in the pipeline, so it’s a great start!
ILP: Are you targeting the Indian diaspora or looking to convert foreigners from friends to fans?
AA: The Indian diaspora is surely our core target audience given the direct relevance of our content. However, we have content across 12 languages including Hindi, Bengali, Tamil, Telugu etc which is relevant for not just Indians but South Asians in general, with content and stories and a cultural context that they can strongly relate to. OTT players across the globe are turning their attention to offering more localized content as more and more people coming online, especially in developing countries, want content in their local language. This is exactly the need-gap that ZEE5 fills. ZEE5 is that one-stop destination that not only Indians but South Asians across the globe have been waiting for where they can get over 1,00,000 hours of entertainment content across genres in their preferred language.
ILP: How do you navigate the sensitive matter of pricing & revenue models – for eg while countries like Pakistan and Bangladesh will have a combination of AVoD (advertising video-on-demand) and SVoD (subscription video-on-demand) with introductory offers for the latter ranging from $2 to $10, others like the United Kingdom, Germany and the Netherlands will work entirely on the subscription model? Is there a median pricing you are working on?
AA: Our business model varies by country depending on the size of the market and the propensity to pay. In most cases we are freemium ie we offer a host of content that’s free i.e. ad supported. However our premium content especially Originals is behind a paywall. Our pricing across markets is again basis the propensity and ability to pay in that market and ranges from $2-$10.
ILP: Prior to Zee5, Zee TV’s digital play was largely focussed around its LIVE TV service called Ditto TV/OZEE, which did gain some amount of traction, has that service been scrapped and morphed into the new Zee5 app?
AA: With the way digital was growing, it really was a natural transition for ZEE as a media conglomerate to consolidate its OTT offerings dittoTV and OZEE into one single, scalable offering that would be the single digital destination for the Group, which is ZEE5. ZEE5 has not only Live TV but also the largest bouquet of VOD content across languages. It offers 60+ live TV channels, as well over 1,00,000 hours of content across 12 languages, across TV Shows, Movies, Originals, Videos, Cine plays, Music and so much more, and is the largest destination for language content.
ILP: Another phenomenon that seems to have dominated the discussion around OTT services is the glut for original content. Is it just old wine in a new bottle? How does Zee5 plan to compete with services like Netflix, Amazon, and Hotstar on the global stage?
AA: The biggest strength we have is our language content offering across the board, be it TV shows and dramas or movies, and also Originals. We have over 1,00,000 hours of content across genres which we keep adding on to. We have a slew of Originals already launched and many more in the pipeline which are available across key languages. Our recent Original productions like Tigers and Rangbaaz have been extremely well received and appreciated. The digital platform allows for greater experimentation with bolder themes and storylines and that’s what viewers appreciate.
ILP: Tell us about some of the new content you’re creating as well as licensing for the service?
AA: We’re creating a host of originals across 6 languages. We launched our first Original film, Tigers in November. We’ve just launched another tentpole show, Rangbaaz, which chronicles the journey of one of the most feared gangsters of Uttar Pradesh from the ‘90s, and this has been superbly received. Rangbaaz will be available in Tamil, Telugu, Kannada, Marathi, Bengali and Malayalam. We have a whole line-up of some very compelling Originals for 2019 – again across languages. All this content is exclusive to ZEE5.
ILP: Does Zee5 plan to bundle its service with cable operators or e-commerce players to ramp up subscribers?
AA: We will be exploring all relevant ecosystem partnerships in order to ensure the largest possible reach and potential audience base for ZEE5. We have recently announced a strategic partnership with NetRange & Zeasn for their line of smart TVs. We’ve also got a lot of other key partnerships in the pipeline and these will be announced over the next several weeks. These partnerships are across IPTVs, Telecoms and OEMs.
To say our guest on indialicensingpost.com is a veteran of the music industry is an understatement of the highest order. He’s worn many hats along his long and illustrious career from strategic marketing manager to handling the complete international music profile to amateur hobbyist DJ to present day as the senior director International music and publishing and head of licensing at Sony Music Entertainment.
A big warm welcome to Arjun Sankalia.
Thanks for talking to indialicensingpost.com
Thank you. It’s a pleasure.
ILP: You’ve been with Sony Music for
over 19 years now, which means you’ve seen the glory days to the Napster phase
and now the whole digital boom. Tell us a little about your journey. Did you
want to quit at any point and seek safer climbs?
AS: There are many questions in there. It’s very interesting that you mention Napster. If I remember correctly I think Napster happened 2 weeks after I joined Sony Music in May of 1999, so I don’t know if I’m the “bearer” of bad luck but it’s quite a coincidence. How did my journey begin? I decided I wanted to be in the music business very early, since the 8th or 9th grade, I’ve always wanted to do something to do with music. I’ve always been very passionate about music, since the age of 8 or 9 I started collecting records and recording cassettes off the radio. So I was always looking for opportunities to do something with music because someone once told me that if your interest or hobby becomes your career, then you’re not working. So, I took that pretty seriously. When I was starting off my career there weren’t necessarily many opportunities… meaning Sony obviously wasn’t there, this was way back in the early 90’s, so in an effort to get a degree or a qualification I went out and did an MBA degree in Advertising and I was very clear that I wanted to do international music, so that ruled out all the Bollywood labels, so to answer your question, yes I did hedge my bet as far as my career was concerned and I actually worked in advertising for 3 years. To answer your question did I feel like quitting? I actually did quit in 2002 and went back to work in an advertising company but quickly realized that advertising is not what I want to do for the rest of my life and I quickly came back to Sony Music in three and a half months and have not left since then.
ILP: According to the LIMA Global
Licensing Report 2017, Music (product licensing and merchandise based on music
groups etc – which doesn’t include
licensing of music itself for advertising and other commercial purposes) clocks
1% of the 262 billion $ pie. Is this in-line with your assessment?
I don’t know the right way to answer that question. If you look at the $ 262
billion figure that would not only include recorded music but worldwide concert
grosses and things like that because the current IFPI valuation of the music
business is around $14-15 billion. So if you were to take that $2 billion
number against the $14 billion figure, I would think that would be in line for
the licensing & merchandising business, though I would not necessarily
consider myself an expert on the same.
ILP: How big do you think the actual
music licensing & merchandising business in all formats is globally and in
India? Which one commands the largest share?
AS: Licensing of music in ancillary products or into products like hobbyist, TV shows etc in the West is quite large, but obviously it is not that large in scale in India for various reasons like cost, development of retail, I would suspect a large amount of merchandise which is sold in the West is via LIVE events and through retail, both of which (LIVE and organized retail) are still growing in India. I don’t think we are there yet.
ILP: According to the LIMA Global study – in Retailing of licensed merchandise – India ranks 20th and contributes just 0.3% compared to US at 60% of the overall business. Are you seeing green shoots as far as licensing is concerned? Are channels like e-commerce and modern retail helping? Given that music consumption is on the upswing, the L&M business could get a fillip as well?
AS: You’re definitely right. We are seeing green shoots in the overall licensing & merchandising business. I can see from where we are sitting (near the office), there is a merchandise store which is called Planet Superheroes which is right across the road and one kilometer down the road, there is an Entertainment store called Title waves, but I don’t know if this has to do exclusively with music and rightfully so. I don’t know if you were to compare the sales of Avengers vs Star Wars vs music – what the ratio would be. But again to answer your question, yes green shoots are there in terms of retail and there are people out there going and investing in retail. Yesecommerce is playing its part. Its taking care of availability. I could be sitting in Baroda or Kanpur and a “Bazinga” t-shirt is just a click away. But one must juxtapose is over the last 5-8 years it with the death of conventional retail, with stores like Rhythm House shutting down
and Planet M. Another way to put it is if modern music retail were still around it would benefit the sales of music merchandise because if I’m in a music store I’m more likely to buy music merchandise, the music store would be more skilled at assessing that if I’m selling say 10,000 Justin Bieber cd’s I could sell a 1000 Justin Bieber t-shirts. Now, fact of the matter is there is no music retail and modern retail is underestimating the opportunity to sell music merchandise.
ILP: India is one of the countries where digital music sales have overtaken physical sales. According to the FICCI M&E report 2018, sales through digital channels account for 65% of overall music sales. More than half of the sales are through ad-supported streams, followed by mobile personalization (25%). Digital downloads accounted for a mere 2% of the overall sales – has the dust settled for the foreseeable future at least or are you suspicious of another technology disruption around the corner?
I’m actually not suspicious of a tech disruption. I think one should look at
digital in India and China differently. What digital and ad-supported has done
to the business is that it has actually expanded the addressable market
substantially. You’ve never had as many people participating in music
consumption by sheer volume using the same kind of device. You’ve had record
players at one point, then cassette players and cd players but device penetration
has always been low or limited. Now if you were to take every mobile phone is a
music player, and there are 800-900 million users in the country and once there
are 100% smart phones along with data penetration. The other great thing is
with all the streaming services out there, the need to pirate either
consciously or subconsciously has reduced dramatically. I haven’t been to a
train station lately, but earlier if you went there, you could pick up an mp3 CD
with 100-150 songs burnt onto them for a 50-100 buck. Today at least in the top
30 cities, I don’t see the need for anyone to buy these as the music is readily
available to you and given the central position the mobile plays in everybody’s
life why would you want to do it? Now you can’t even give a CD away, 5 years
ago you could give it to someone thinking they will grab it. Now most computers
don’t even come with a CD drive.
ILP: Music companies seem to be venturing into a wide range of activities such as producing edutainment-based content for children, current affairs magazines, concerts, themed restaurants, artist management, hardware products, business content & spiritual content to name a few. Which activities have you explored and how have the results been?
AS: Spiritual content we’ve always had within the company, and that could have been organic or inorganic, because spiritual / devotional music is 5-7% of the market, I’ve seen in places like Mapusa (Goa) market you get a lot of gospel music, if you go outside Siddhivinayak you will find a lot of devotional music which followers pick up on their way in or way out, so we’ve always been in the spiritual / devotional space. We recently around 3-4 years ago started a kids content division, which produces edutainment and DIY stuff, there’s some really cool stuff which will be launched shortly. We’ve not ventured into the LIVE space, but we are in the talent management / artist booking space with some of our artists.
ILP: Has the rate of piracy declined with the introduction and increased affordability of new streaming services?
AS: I would say Yes. I don’t have the stats, but I would surmise even anecdotally that after accessibility has increased, the rate of piracy would have dropped. For example, how would you carry around 100 cd’s in the car? There is no need. Because even if you buy it how you going to listen to it? If you were to look at the sales of headphones and blue tooth speakers, then you’ve got a music system. strategize can see that there is definitely an upswing. If you go to a hostel you will find most of the students playing their music on their Bluetooth speakers. The phone has become such an integral part of you now, you first ask can I do it on my phone and if I can, why should I buy something else? I don’t own a music system at home. Many people spend a huge amount on music systems but use blue tooth speakers. These things prove that the mobile is playing the music off a legit service. If you’ve got 220 million users on in india on you tube, that’s a sizeable number. And with the CD you were either playing it in the car or at home. I don’t think those exist anymore. I don’t know when the last time was I put the CD into even a DVD player. Things have changed drastically.
“I don’t own a music system at home.”
ILP: YouTube still remains the no. 1
destination for music and music video consumption. Facebook is looking to jump
into the fray as well. Does this bode well for the music labels? Tell us a
little more about your licensing strategy with respect to these players.
Yes, it does bode well from an overall aspect, it does bode well for the music
industry. Youtube being the #1 service and #1 place for self-expression and
others express themselves I presume that Youtube is the #1 source for music
consumption in the world. But there are various issues related to Youtube which
I’m sure you’ve read about which pertain to the “Value Gap” which is that the
remuneration from Youtube is not necessarily in-line with what one would get
from a standalone music service. But those issues are being addressed and
Google has launched its own music service in various places. But my philosophy
is that Youtube is a licensed and legitimate way to consume music and the
nuances of how to make it more equitable for all stakeholders are being looked at.
ILP: Why haven’t we seen as many brands licensing music for their commercial communication? According to Pradeep Guha of 9X Media, he feels and I quote “the fault lies with the stakeholders of the music business who tend to discount their own product. Advertisers consider music almost the last in the food chain as far as their spends on commercial communication is concerned” unquote. Your views on the same?
I think it might have to do with an overall knowledge, consciousness, awareness
of copyright. When I was in advertising there were these urban legends that one
didn’t need to pay for music if I change a note or if you used it for less than
20 secs you didn’t have to pay. I remember in the 80’s there were line by line
copies of international tracks without any worry of copyright infringement. So
because of this lack of awareness no one was aware of how much it would cost to
clear the copyright. The second legacy issue is I think I think Pradeep Guha is
right in the sense that it’s the “last thing in the food chain“ ad filmakers
haven’t been paying as much attention to the use of music in their
communication. However things have started to change with more awareness with
people paying what is considered to be fair value for the track being used. For
example we licensed the Ed Sheeran’s track “Shape of You” to a Unilever brand
last year and it got approved by International offices and it was a decent
amount. It’s more of a mindset issue where if say the production cost of a film
is a crore (10 million) and they’ve kept aside 10-15% for the track, then it
becomes a budgetary issue. What I try to tell people is that if you think the
track really fits well with your communication then instead of pegging it to
your production cost, peg it to your overall media spend. Because a 1 crore
commercial might actually have a 100 (1 billion) media plan behind it. So
instead of 50 lakhs of 1 crore, is 50% but 50 lakhs of 100 crores is not
necessarily the same. You may lose out on a few on-air rotations of the spot
but the deal is a lot more equitable and realistic.Because if you’ve written a
script around that particular song, it should command a lot more value. So they
look at it as part of the whole media buy and not as a fraction of the media
ILP: Give us some examples of successful
sync or music licensing deals that have happened in the recent past?
AS: Shape of You done with a Lever brand, Black Keys song will go air shortly, Saregama’s done a lot of sync deals. We’ve licensed music to Micromax to Bajaj for a motorbike which had a track from Bhaag Milka Bhaag. Theres a lot of action happening in this space. Even in the Chinese market a similar state existed – it takes 8-10 years to work out. So at some point in time we will also catch up.
ILP:How does a new artist go about licensing their music? Do they have to produce the track and come with hobbyist video or will Sony music help them with that?
Yes you can come with the finished product and we will help them market it. But
more often than not we sign up an artist and work with them on overall artist development.
There are many aspects involved like song writing, song production, the whole
creative process, the physical process which has to do with the creation of the
song, then the deployment of the track either in India or around the world,
then there’s marketing within which comes music video creation. Now, here many
things have changed. Earlier when broadcast was big you would showcase your
music video on multiple TV channels to sell your product, today there’s a stat
that says millennials look at their phone about 150 times a day and if let’s
say out of those 150 times, they are 80 times looking at Instagram, then you
need to be present in the persons media feed. And now with the culture of everyone
becoming a creator, you can’t have just one video, you need to have a whole
allied marketing strategy with dance off challenges, memes and all these
ancillary pieces of content to sell that piece of content. The idea is you need
to have multiple pieces of content instead of just one showing up in people’s
media feed at any point in the day and we help people strategise on how to go
about it. And today the beauty of social, with the extreme access that fans
have to their stars, I could write to Donald Trump if I wanted to via Twitter.
If I see my favourite artist playing with their dog and I like dogs, I’m going
to be a lot more interested in their content. So there’s a wide spectrum of
content which needs to be put out. All of this needs to be factored into the
ILP: In this age of social media overload what’s the tipping point for an artist to be taken seriously by a music label to license their music? Is it a million fans on Youtube?
I don’t think there’s a specific number. With A&R guys the finesse lies in identifying
the parameters for spotting the talent early in the artists trajectory rather
then when they’ve already got a million fans and have become
mini-celebrities.Its like the stock market you want to jump in as early as
possible. And there are many tools and companies worth a lot of money like Soda
tone which can help you identify what is buzzing among people. I read this
book, there was this story about how on the Sunset strip there would be all
these record executives who would go there
to see these glam metal bands perform and if you saw more than 3-5
A&R guys sitting in a bar, then there would be most of the labels bidding
to sign that act. But if 3 months earlier you were the only guy there then your
chances would be much better.
ILP: Does Sony music help Indian music
artists launch globally?
AS: Yes, we are keen to take Indian music to the world stage. That is an objective. Indian music has had its moment on the global stage with AR Rahman at the Grammys but when will we have our sustained moment. But I think the question to be asked is when will we have our own Meghan Trainor or our own Despacito and I think that will happen sooner than later because if you see the rise of Latin or K-pop outside of Latin America and Korea around the globe, India should follow soon whether its hindi or english or tamil, one does not know. If I were to be bold I were to say next 3 years if I was not I would say the next 5!
Thanks for speaking to us at indialicensingpost.com Arjun! We look forward to keeping the communication going and receiving feedback from our listeners and readers and your responses to the same. Cheers!
We caught up with Dan Frugtniet – VP – Licensing & Business Dev at Viacom International Media Networks (VIMN) on the sidelines of the India Licensing Expo for a candid chat on his travels across India, state of play for his portfolio of brands, piracy, and his advice to first-time entrepreneurs.
ILP: You seem to have a highly in-depth knowledge of India having traveled extensively across the country in the 90’s and now in your current role as VP, Licensing & Biz Dev for Nickelodeon & Viacom Consumer Products. How has the licensing industry shaped up according to you since then?
Dan: I’ve traveled a great deal across India back in the 1990’s and have some fantastic memories of your country. I joined Viacom 8 years ago and witnessed how much India has changed dramatically over the years. Especially the licensing space has seen huge changes I would say in the last 3 years. It’s always a pleasure to visit India and this is my second visit to the India Licensing Expo so thanks again for welcoming me!
ILP: In your current position at Viacom you oversee the Emerging Markets region, please share some of your insights on how these markets are shaping up vis a vis the global landscape.
Dan: Each market has its own nuances, tastes and preferences and we like to look at them independently rather than a one size fits all approach. All of these markets for Viacom Nickelodeon Consumer Products are showing a positive upward trend as far as licensing is concerned and we continue to expect YoY growth as we move through 2018-2020.
ILP: Which are some of your key properties and some of those in the pipeline?
Dan: Our 3 biggest brands in the portfolio from an India licensing perspective are MTV, SpongeBob SquarePants & Dora the Explorer. SpongeBob has his 20th Anniversary in 2019 so there will be lots of activities to help celebrate including new Seasons and a 3rd Movie in the pipeline, and Dora is 20 years old, but they still have massive consumer fan bases around the world. So, we continue to nurture and grow these evergreen properties. But we are also now very much focused on Paw Patrol and rolling out new categories and SKU in India over 2018-19 and onwards. This property is a global pre-school juggernaut and continues to win awards and gain fans all over the World! At the same time, we are beginning our journey with Shimmer & Shine, an awesome girl’s pre-school property, and Mattel will launch Toys Q1.2019 in India with new licensees and new categories to come.
ILP: When do you think a brand is license ready?
Dan: That’s a million-dollar question. I think a property needs to build a strong and robust connection with the audience in an impactful manner (which in our case could be through a TV show or digital content). With that built-in audience, it gives a licensor like ourselves the confidence to go out into the market and monetize it with consumer products.
ILP: According to the latest LIMA figures the global licensing business is valued at $272 Billion of which character/entertainment licensing comprises a majority share of 44.7% at $121 billion. Viacom has a significant play in this space. What has been your strategy to grow this category and take it to newer heights?
Dan: At Viacom, being a big portfolio Licensor and specifically a pre-school powerhouse in the character entertainment space, we are continuously investing in both nurturing our evergreen franchises as well as building and launching new properties that will appeal to our core target-demographics i.e. kids 2-12yrs. We want to be present wherever they are and entertain and educate them in the best possible way. JoJo Siwa is a great example. JoJo has a HUGE global following as a tween social-media talent – her YouTube footprint has had 1.3 billion views! We created a consumer products programme for her, and JoJo’s signature hair-bow became a global trend with over 10+ million bows shipped in 2018!
ILP: Closer home, retail sales of licensed merchandise in India have grown a total of 44% to $1.476 billion over the last 4 years. This despite a HUGE grey market. How is Viacom tackling the problem of piracy? Any key steps based on learnings from other markets?
Dan: Yes, piracy is a HUGE issue we all face globally and we continue to work with the customs and police departments in all our markets to ensure our IP is protected through enforcement, etc. We rely on our partners to help report counterfeit products and then take immediate action to address it. Anti-counterfeit operations require the support of all key stakeholders from Licensors / Licensees / Government Depts / Retailers and Distributors. Part of the problem-solution is to identify and clean markets of fake goods, but there also needs to be a focus on education of consumers and parents that counterfeit products are potentially dangerous and may injure a child.
ILP: You have experience in vertical licensing businesses with a client direct model as well as Licensing Agent model in a variety of territories. Which has proved to be more productive and efficacious?
Dan: In India, we work with our JV business Viacom18, and they manage all of our IP in India and South Asia and do some amazing work and deals in the region. Myself – I have spent the last 13 years working on Direct-to-Licensee and also Agent models so understand the nuances of each, and they both have an important place within any Global Licensor to expand their licensing business.
ILP: What are your key checkboxes for signing up a licensee?
Dan: For me personally, I like to see a lot of passion in potential licensees that they are going to give their 110% to not only recoup their MG investment but to also develop an innovative product that is priced competitively and ultimately is appealing to our target-demos and sells at retail. Ultimately, trust is a very important factor, this is an essential part of any successful licensing deal as let us not forget that the contract terms are long and we need to work together for years, so it should be a happy partnership built on strong foundations for the long-term. Finally, I would say communication is the other key factor, if there is a problem I want to hear about it right away from my Licensees or Agents, then together we can find the solution!
ILP: What is your advice for a young entrepreneur looking to set up a licensing business?
Dan: Find your passion. Do you have an idea that you think you can execute or a product that you believe in and also believe that other people need and would pay for? Then go out there and start networking. Meet with a few experienced folks in the business, get their feedback and together sharpen the idea or product until it has achieved a certain critical mass. The next big thing could be waiting for you just around the corner. Keep your eye out for it and remember to come to the Viacom Nickelodeon Consumer Products team first!
We managed to catch up with Mr. Dhimant Bakshi, Jt CEO, Adlabs Imagica on the sidelines of the India Licensing Expo. To listen to the interview you can scroll to the bottom.
ILP: Give us a little background on Adlabs Imagica. We know its a 130 acre property in Khopoli, which is on the outskirts of Maharashtra and is India’s answer to DisneyLand, but tell us more about what you have to offer?
Dhimant: This is a dream our promoter Mr. Manmohan Shetty saw years ago when he visited DisneyLand in California and his dream was why can’t we create something with Indian content that is a themed destination with Indian pricing in approach but international in terms of ride quality and guest experience that is world class. It is a dream that we all live by. We firmly believe that the Indian demographic is perfectly poised for such an offering and we really want to give Indian-nes in our entire experience apart from various other international flavours that we can blend in, and get some of the best in class rides made. Some of our rides are as good as Universal or Disneyland both from a safety stand point and ride quality. So we also said we have to create Indian IP which is related to the park and convey the Indian-nes in what we really do.
ILP: Talk us through the buffet you have on offer at Adlabs Imagica. You have a waterpark, a theme park, a snowpark etc.
Dhimant: Our approach was to build an entertainment district really. So we started off with the theme park which is a 74 acre property with 25 rides and attractions. Apart from that we have a 20 acre water park with 14 rides and the wave pool, apart from that we have India’s largest snowpark with real edible snow and we have a 4 star hotel called Novotel Imagica , managed very well by Novotel. So apart from these 4 anchor properties we recently launched “House of Stars” which is India’s first official Bollywood hall of fame which has sets as well as characters. Apart from that we have “Eyelusion” which is trick-eye museum, which is a first time one would see this concept in a theme park. We also have integrated with “Chhota Bheem: The Ride” which is the first character based roller coaster ride in a theme park. And since you used the word buffet, I must use the word “sumptuous” to describe our offering at Adlabs Imagica. One can really pick and choose what they would like to consume. There’s something for everyone. And what really tops this up is after a day of fun and entertaining experience, there is a wide range of themed-cuisines options which is designed and operated by our own team. This is coupled with merchandise and fantastic guest experience that, of course, has to go without saying.
ILP: So now lets talk about the business of licensing – how do you think licensing can help Adlabs Imagica?
Dhimant – Apart from being very obvious that it adds to the revenue stream, more importantly what we feel is that there is a need of Phy-gital experience that one has to get. We as a theme park can give a physical-outdoor recreational experience that one would really look for. With the onslaught of media and so many characters coming and going, they need a place to live in really, when most other characters start from a animation, TV show or game etc.
Ours are all original characters – designed, created and owned by our in-house team, its a long journey. While we will look up to Disney for inspiration, our efforts is to slowly and steadily make products and services that are appropriate for Indian market. Make them affordable, yet aspirational without trying to charge an undue premium. And we really want to fight piracy and find a more collaborative solution of licensing wherein it’s a more revenue share approach as well. It is not just me charging you a licensing fee and not caring what happens to you later. We want a win-win and collaborative approach for both parties.
ILP: How is this merchandise being distributed? Is it primarily at the theme park?
Dhimant – Yes, primarily at the theme and water park, but very interestingly we have made forays into Hamleys. it’s more a retail arrangement not a licensing arrangement like a DTR. Apart from that we also have Amazon, Flipkart, Myntra, Jabong, Limeroad, First Cry – many such online channels through which we sell our merchandise. And people recognise and love our characters, whether it’s a Gautam Budhnagar or Trivandrum, the love travels far and wide and thats what really gives us the high / impetus to create more such characters. (So the strategy seems to be make them fall in love with the characters at the theme park and get them to buy when they travel back?) Catch them young and watch them grow.
ILP: Any other plans in the L&M space that you can talk us through right now?
Dhimant – This is really our first effort in the licensing market. The way we planned was to spend the first 4 years building our own characters, we really were not open to getting in external characters, primarily for the reason, that once you get into the trading mindset you will never build your own brands. Apart from the investment, it’s the time and effort that our team has spent on creating the characters from scratch and getting them right, and then, opening doors for other characters. We see Imagica as a place for all characters, very secular. Infact, we are open to other alliances. We definitely want that India progresses and content is consumed well, and merchandising options is going to be a logical output. If you see right now with the number of channels, it is complete media over-load so 1 is to build affinity and 2 to retain. Building affinity may happen but is retention really happening? We believe in having a 360 degree view. And the term which was used yesterday was ‘Sustainability’. There are conventional channels like TV and digital media for animation, but there is going to be a humongous overload and people will NEED to take a break and look towards physical form of recreation(then all roads will lead to places like Adlabs Imagica) and I hope and pray the industry opens up to more such collaborative licensing models. It shouldn’t be You vs Me, it should be YOU & ME.
ILP: Whats your advice for a budding entrepreneur wanting to start a business especially given the tectonic changes we are seeing in the retail space?
Dhimant – Before I go to entrepreneurs, I think what you have articulated as a question is a great business need. There are many angel networks and organisations like LIMA who can offer direction and guidance to young geeks and entrepreneurs and get sounded off on what they can do and receive feedback. We are happy to be a part of such organisations. There are many buzzwords and many people get floored into them without really taking a stock of their situation. Coming to your question, at an industry level we should probably build an incubation centre if I may use the word. And second, seeing what your idea can do for people, solve a problem, not just because there’s a whole lot of moolah sitting there and let me make money out of it. It is about going to the basics and have it all well thought out. It has to be a more long term approach. Essentially, it should be long term.
Thanks for the chat and the insights and thanks for talking to us at IndiaLicensingpost.
Many consider Mr. R Jeswant (SVP – Sales & Mktg) Funskool India to be one of the doyennes of the Indian toy industry. We managed to get some time with him for a chat about his life before and at Funskool!
ILP: Tell us a little about your journey before you joined Funskool?
R. Jeswant (RJ): I have been with Funskool (India) Limited for over 18years now after joining the company in April 2000. Prior to that, I’ve worked with TI Cycles of India as Regional Manager at Delhi and Kolkata and was heading Product Management when I left in 1996 . I have also had a stint with Blue Star Ltd as General Manager (Sales) in their Packaged Airconditioning Division at Chennai and before joining Funskool I did spend 3 years in Sana’a(the capital of The Republic of Yemen) heading a company which represented Philips, Whirlpool etc… as exclusive distributors for the Republic of Yemen.
ILP: You’ve been at Funskool for more than 18 years. How has the journey been, please tell us a little about the highlights.
RJ: It has truly been a fantastic experience. I started as DGM(Sales), then GM (Sales & Marketing) and am Sr VP(Sales & Marketing) now. From when I started to now, the business has grown more than 10 times, We have over the last few years been able to build many of our own brands, have added many new licenses, represent many more companies as exclusive distributors for India etc…Many of us have been with the company for long periods and the journey together to get Funskool to its position as India’s leading toy company has been a wonderful experience.
ILP: Looking at the Funskool catalogue you seem to have licenses from all the majors like Cartoon Network, Disney, Warner Bros and many more. How have these brands fared in the Indian market from a toys point of view?
RJ: Licenses are beginning to work very well in toys though it is nowhere near what it is in the more developed markets. The toy market here estimated at around US$ 450 million at retail is about 0.5% of the world toy market of nearly US$ 90 Billion. In addition to Disney, Warner Brothers, Viacom etc… we also manufacture products for the Indian market under license from some of the major international toy companies like Hasbro of USA, Takara Tomy of Japan, Ravensburger of Germany, Jumbo of Netherlands, University Games of USA and many others.
ILP: You also retail your own brand of toys – Giggles for infants and toddlers, Handicrafts – your arts and craft line, FunDough – your range of colorful dough and Play & Learn – your range of educational products. Was there are a conscious shift to launch these product lines to fill gaps that overseas brands were not able to meet?
RJ: Affordability is very critical in the Indian market . Customs duties went up by 10% in the last union budget, GST introduced in July 2017 resulted in roughly a 5% increase over VAT, introduction of new testing standards for all imports into India, all resulted in imports becoming more expensive. With our own brands and licensed products manufactured at our factories we are able to hit optimum price points which take products to within reach of the average Indian consumer for toys.
ILP: Considering you’ve witnessed the toy industry from such close quarters for almost 2 decades, what are some of your key learnings?
RJ: There is very little history for toys in India. Most parents have not had much exposure to branded toys and do not understand the need for toys in the development of children. The toy market is just evolving here and there is a dearth of shelf space for toys. The high rentals in malls and the rather low returns from the toy area compared to some of the more evolved categories result in a lower allocation of space for toys. Affordability is critical and we have an advantage here because of our ability to manufacture quality products at affordable prices. We have also embarked on a program which we have called “Operation Reach” to get to smaller towns where branded toys are sparsely available as of now. We hope this will give us the first mover advantage and pay off in the long term. During the last 6 months, we have added 75 small towns to our distribution network which is, without a doubt, the largest in the country. We service over 5000 retail points, have 16 warehouses across the country, 6 Regional offices and over 85 sales and marketing personnel.
ILP: It is estimated that 20% of the Indian population is between 1-12 years old. That’s a HUGE addressable market, isn’t it?
RJ: This is the reason why all major toy companies are making a beeline for India. They all feel that India with its large young population will be the market of the future. We are very upbeat about the future and estimate the market to grow at a CAGR in double digits for several years into the future.
ILP: According to the LIMA global study 2017, the Toys category comes in 2nd (13.3%) after apparel (14.9%) of the Global retail sales of licensed merchandise which amounts to approx. $262 Bn. India seems to be lagging far behind! What can be done to improve this scenario?
RJ: With more young parents who have had some exposure to branded toys and licenses coming into the market, we expect to see exponential growth in the market soon. With viewership for Indian Animation surging (Chotta Bheem is a glorious example) and companies like Disney, Warner Bros and other licensors building awareness for their properties in India, the market for licensed products is bound to grow. With manufacturing activity for toys picking up in India, the licensed products should also become more affordable and that is when the sales will really grow faster.
ILP: How do you keep the wheels of innovation churning within the company, considering you are catering to a very demanding audience?
RJ: The toy industry is driven by novelty and by merchandise based on TV animation and movies. We have a full-fledged team of design and product development professionals who work tirelessly to come up with new toy concepts. The concepts are then tested with children, retailers and our own sales teams before they see the light of day! Tooling is expensive and therefore till the Indian market really evolves molded toys based on animation or movies will have to be imported to a large extent as the Indian market at this moment is just not big enough to justify large investments in tooling unless a worldwide market is targeted. This will take time. However, when it comes to the generic infant & preschool toys market which is the biggest chunk of the Indian market, we have made considerable investments in tooling because the generic line of products tend to have longer life cycles. Our investments in our own brands like Giggles, Fundough etc..have paid off well and we are now present with some of our own brands in markets outside India as well.
ILP: According to your website, Funskool is India’s largest toy company, with a revenue of around INR 220 Cr. (public source) What percentage of this is attributable to Indian brands vs foreign brands?
RJ: We expect our locally manufactured products to be roughly 40% of our domestic business during the current financial year.
ILP: We also noticed that your website funskoolindia.com doesn’t sell toys directly but diverts traffic to Amazon. Is this because of FDI norms? Is a full-fledged e-commerce shop in the offing? Do you think it will deliver adequate volumes?
RJ: We sell our products online through Amazon, Flipkart, First cry and on many other e-commerce platforms. While there are no FDI norms that prevent us from selling through our own online platform, we feel that at this point of time it may be more prudent to sell through the major e-commerce players. We may look at having our own e-commerce portal sometime in the future.
ILP: Which is the best performing brand for you?
RJ: The biggest success for us has been Giggles, our own Infant & Preschool brand. This has been most satisfying and we expect the brand to grow much stronger in the years to come.
ILP: You mentioned in another interview that Rubik’s cube is one of the most pirated toys in India. Any theories on why this is so?
RJ: Rubik’s cube for which we are the only authorized licensee in India sells very large numbers. The product that we distribute is of a much higher quality than the cheap imitations that are available in the market. Knock Off’s or imitations of best selling products are bound to flood the market and that is happening in the case of Rubik’s cubes as well . However, where there have been patent/trademark violations strict action has been taken in the past.
ILP: To what extent does piracy affect the board games / toy industry? What measures has the government taken to reduce the same?
RJ: Legal remedies are always available to check piracy but are often cumbersome and not worth the effort. While piracy is a problem, it has not got out of hand probably because of the size of the Indian market itself!
ILP: What are your key checkboxes before you license a brand?
RJ: The relevance of the license to the Indian consumer, how the license lends itself to toys, investments required in developing licensed merchandise are all considered before we decide to go ahead.
ILP: Which distribution channel has proven to be most effective for the toys category?
RJ: For high priced toys, toy specialists like Hamley’s and large stand-alone toy stores are very important. However for brands like Giggles which we target at a wider spectrum of customers, hypermarkets, and mom & pop stores are very important. We have a strong presence in toy specialists, hypermarkets, department stores as well as Mom & Pop stores. Our own retail chain of “Funskool” stores now has 16 stores and we are targeting to increase the number rapidly.
ILP:What would be your advice to an entrepreneur looking to get into the licensing business?
RJ: To tread carefully! Toy distribution is not easy and unless you have the infrastructure to reach out to across the country and to service the network it may be better to stick to a limited geographic area.
ILP: Tell us of one instance which comes to mind where licensing helped?
RJ: We are hoping to have a licensed range of our own Giggles brand in the market soon and we are all hoping that it will happen soon. Our biggest success in licensing has been with Beyblades. We have had the Beyblade license for India for several years now and the products are sourced from Takara Tomy of Japan. Over a period of time Beyblades has probably been the largest selling toy for boys in India and continues to do well. Whenever a new animation season of Beyblades is on air, sales start to peak. We will have new animation on air soon and are looking forward to sales hitting new highs!
Driven by the values of trust, quality and excellence, Bodycare International in the past two decades has become a force to reckon within the innerwear market. Founded in the year 1992 by Mr. Satish Gupta, the company today enjoys the distinction of being the country’s leading manufacturer and supplier of Kids Undergarments, Thermals & Loungewear for the complete family.
IndiaLicensingPost spoke with Mr. Sachin Gupta, Director at Body Care International to get more insights on the company and more importantly his views on the licensing business.
ILP: Body Care was founded back in 1992 and has since grown by leaps and bounds not just in India but on the International stage. Can you shed some light on your growth in terms of growth of business or market share since inception? What do you attribute this to? Who are your key competitors?
Sachin Gupta (SG): In 1992 we started with just an installation of 2 sewing machines in our home and now have state of the art infrastructure with below facts and figures
The best manufacturing facilities comparable with those found across the globe.
About 300,000 sq ft area with units located at Noida, Delhi, Dehradun and Tirpur.
We produce north of 25 million pieces per annum and are further expanding.
We employ over 2500+ people.
We have a pan India presence with 300+ Distributors
ILP: You are currently tasked with HR, finance, admin and purchases of the company? That’s quite a diverse profile. How did that come to be?
SG: Being a family run business we are involved and aware of all the functions but the specific responsibilities are divided among family members based on their interest and capabilities and especially where one has the best skill sets.
ILP: According to the LIMA Global study 2017, licensed apparel at retail accounted for almost 15% of the overall $252 Bn retail market. How big do you think that share is in the Indian market?
SG: In India, the licensed apparel market is still not that big but growing at a faster pace. As per my understanding, it’s more related to retail formats as well. As more & more organized retail grows, the share for Licensed merchandise will increase.
ILP: Bodycare has been a pioneer on many fronts including:
Being the first to introduce Lycra stretch fiber in Inner Wear in India.
First to introduce Procian Printed Girls Panties in India
Latest Seamless innerwear technology
Would you also credit some of your success to the strategy of licensing global brands for your product portfolio? How has licensing helped you?
SG: Yes, the acquiring license at early stage has helped us lot not just in term of branding but has helped us increase our global exposure as well, which really helped in developing world class products.
Our tie ups with International licensors has also helped us to know the best international practices followed in branding and marketing.
ILP: Can you recount any one licensing program which worked well for BodyCare?
SG: Hannah Montana with Walt Disney, I feel is the most successful licensing program till date.
What are your expectations from a licensor?
SG: Our key asks from any licensor are as follows:
They should create and maintain demand for the character.
Provide us licensees with style guides & design support by sharing best products across the globe.
Marketing and promotional support
ILP: Since you are in the organized retail space, how do you view piracy? What steps do you think the authorities can/should be taking to tackle the menace of piracy?
SG: Piracy is certainly a big challenge for our company as we trade in original IP. The current laws in India are not that strong which is actually helping the culprits. Many a time, licensors are not able to safeguard their own brands and take strong action, hence violators can operate without fear.
When you think of WWE, images of gigantic men and women, body slamming each other come to mind. But there’s much more at play beyond the ring. World Wrestling Entertainment, Inc., aka WWE, is an American integrated media and entertainment company that primarily is known for its brand of sports entertainment. It has branched out into other fields, including movies, real estate, and various other business ventures. As of 2018, it is the largest wrestling promotion in the world, holding over 500 events a year, with the roster divided up into various globally traveling brands. Over the years WWE has managed to build a very strong licensing & merchandising business which riffs off its on-air programming.
Archana Keskar, Senior Director Consumer Products Licensing & Retail, South East Asia & South Asia, WWE helps to demystify this massive goliath for us.
ILP: You have dabbled in the licensing business for quite some time and with multiple brands including the STAR Network, Disney, Cartoon Network and now WWE. What’s it about the licensing business that you find most exciting and spurs you to dream bigger and jump higher?
AK: The brands I represent. If you believe in a brand, it’s personality & attributes, you are better placed to plan brand extensions. This is the same reason a consumer buys into WWE and licensing is a great tool that allows a win-win partnership between licensors & licensees. You are only limited by your imagination: which other business model allows brand extensions across multiple product or service categories to deliver 360 degrees consumer value?
ILP: Do you believe the business of sports licensing is coming/has come of age in India?
AK : I think, in general, licensing as a business model still has some distance to travel in India irrespective of the genre. However, more sports and sports leagues are getting support and exposure, and are now more mainstream than before. With increased support to the segment, the overall relevance and brand association opportunities will continue to grow.
ILP: WWE is a $1 billion brand at retail. Most of us in India was first exposed to WWE thanks to the likes of “Stone Cold” Steve Austin and The Undertaker. Now you have a whole new generation to serve. How has WWE evolved to meet the change in the demographic?
AK : There are more consumer touchpoints for WWE than ever before. As well as more than 550 live events around the world every year, WWE programming is available in more than 800 million households worldwide, and is broadcast in more than 180 countries and 24 languages. WWE Network, our subscription-based TV service, had a record 2.1m subscribers as of WrestleMania 34. In social media, WWE is the number one sports channel on YouTube ahead of the likes of the NBA and FIFA, and is the second-most viewed channel on YouTube overall with more than 22 billion lifetime video views. WWE has more than 900million total followers across all 18 platforms. WWE has a diverse roster of more than 250 Superstars and Legends
representing nearly 30 different countries speaking 17 languages and counting, and featuring household names like 16-time World Champion John Cena to new talent like our very own Jinder Mahal who was the first World Champion of Indian descent, last year. We also enlist new talents from different countries every year. Collectively, they are global personalities, icons, heroes with huge star power that is relevant to consumers of all ages.
ILP: Globally WWE works with over 200+ licensees. What are the checkboxes from a WWE standpoint before appointing a new licensee?
AK: Passion for WWE, expertise in a specific product range or service and distribution strength. There is very high demand for WWE products in India and to meet this, we are looking for experts in varied category segments.
ILP: Talk us through the licensed product portfolio in India and other categories in the offing?
AK: We work with some of the best in different product categories like Mattel for Toys, 2K, Scopely for Console & Mobile Games, Topps for Trading Cards, DK Penguin Random house for Books,
Funko for Collectible figurines, Parle & Perfetti Van Melle for Promotions and WWE Superstar Authentic merchandise is available on our e-commerce platform, wweshop.in, launched in partnership with The Souled Store. Our core target consumer segment being the 15-25-year-old young adults followed closely by kids (4-14years) and to meet their demand, we are now in discussions with local companies across multiple categories including but not limited to Apparel, Footwear, Bags, Stationery, F&B, Home products, even promotional tie-ups.
ILP: Give us an example of a great licensed brand fit with WWE?
AK: WWE is a lifestyle brand with a portfolio of globally popular Superstars. Other than Action Figures and Games, Apparel & Superstar Fashion Accessories has the highest demand. With hundreds of Superstars to design for, the range possibilities are immense.
ILP: Which is the one license program you’ve run at WWE which qualifies to be in your personal hall of fame?
AK: The best is yet to come.
ILP: India is still a very conservative country when it comes to entertainment opportunity. How do you get past the gate-keepers (parents) to sell licensed merchandise to kids?
AK: Let me share a few examples; WWE video games have always been in the top 5, 2018 is the 11th year for our Trading cards, Mattel launched the WWE Action Figures & Playsets in April this year and few SKUs are already out of stock, Superstar authentic gear sales from our ecommerce platform – WWEShop.in
has consistently grown since launch last year. To break this down, WWE is an aspirational brand with mass connect across Young Adults & Kids segment alike. In terms of popularity, India is our number 1 market for TV viewership or social media following and people of all ages attended our India Events in the last two years. With demand this high, the only way we will be relevant to all gate-keepers (retail & parents) is to have good quality products & promotions with reputed companies and aim is to add to the existing product range in the country.
ILP: Any key learnings you would like to share regarding your journey as a licensor of one of the biggest sports brands in the market?
AK: WWE is unique. We are a sports-entertainment brand and the global consumer base connects with the larger than life Superstars; their personalities and stories. Our brand is not dependent on a single championships or sports series but is relevant every day of the year without a break. Therefore, innovation is key, be it Content or Consumer Products.
ILP: What does the roadmap for WWE look like over the next 5-10 years? Will consumer products or content syndication drive the agenda?
AK: Both go hand in hand. India is a very important market for us and we are carefully evaluating opportunities for localization across all lines of business.
ILP: What does Archana Keskar watch on thetele when she’s not watching WWE?
AK: We have interesting content every day of the week but when am not tuned into WWE, I catch up on Hindi movies. But it’s interesting as sometimes even that brings me back to WWE like Dangal, Sultan or even Brothers.
To listen to the interview, scroll to the bottom and hit play.
He’s been a serial entrepreneur and the founder of the company which was established 19 years ago back in 1999 – has successfully managed to grow the company’s revenue from 1.2 Cr to over 80 Cr as of FY 16. The company was initially set up as a Home Entertainment line, Excel Productions Audio Visuals Pvt. Ltd. (aka THE EXCEL GROUP) but has since ventured into many product verticals in the licensing and consumer products space such as Excel Home Videos, Excel Interactive, Movies & More, My Baby Excels, StarWalk, Excel Innovators and Nitroid. My guest today is Muslim Kapasi – CEO of the Excel Group. Hi Muslim, thanks for your time.
Muslim (MK): Thanks very much for the kind introduction. I’m very happy to be speaking with IndiaLicensingPost. You know how it is with social media these days. Always saying a lot more about you.
ILP: You’re a fairly media shy guy. We couldn’t find too many interviews of you, which is why we are so grateful you allowed us to speak with you.
Today Excel is one of the largest licensees in India, please take us through your journey. What were some of the pivotal moments?
MK: We started as a manufacturing set-up. I don’t think many people know how we actually started with our home video business first, and what led us into licensing. That’s where the whole seed was placed. We had a whole manufacturing unit. We were the sole manufacturers for 20th Century Fox and CIC which was a JV between Universal and Paramount pictures who use to manufacture their own videos in India, they had their own offices in India (this is somewhere in the mid-90’s), and we had done an OEM deal with these manufacturing companies. While we went about building a state of the art manufacturing plant which would meet with Hollywood standards, we hoped Bollywood would follow as well, but that didn’t happen. So we had a manufacturing set up but we were struggling with very low capacity, and this went on till 1997 till Cable and Satellite television took off and more and more consumers were exposed to LIVE news etc prior to which we only had the standard Doordarshan fare or you would have to rent a VHS and watch it at home on your video cassette player. So that’s where we were at that time. Piracy was booming. Very little manufacturing being done at our factory, we had debts and we had no customers. Fox was struggling at that time, CIC had shut down, they decided that India was a lost cause. That’s when we realized, we could pitch for licensing the products of the brands we were working with and build a business out of that. In hindsight I think it was a great decision, but if it were today, I would tell anybody NOT to do it. Having said that we signed up the Fox license to run the factory. Coincidentally, 6-8 months later we realized, that we were much better as distributors than manufacturers and a year and a half later we shut down the manufacturing completely and we started outsourcing manufacturing as we didn’t have the bandwidth, we didn’t have the time and we needed more folks in the marketplace at the front end rather than the backend. That’s how we got into the licensing business. That was a foot in the door. Factory ko chalana hai, factories bandh ho rahi hai. Fox was shutting down and we had set up the manufacturing unit especially for them. It was very empathetic of them to give us a license at not very difficult terms at all. They must have realized that they owed it to us. In fact one of the Fox officials whom I will not name said “You will burn out in a year or year and a half”, but that was not to be. Soon Disney came our way and then Paramount. Then we realized, we should diversify and the closest thing we understood was gaming, because gaming was still very much a physical product, so we signed on Electronic Arts (EA games) for PC games. The pivotal moment is that we diversified in the right product at the right time. As you realize with technology businesses, change is inevitable and what was peaking now was about to sharply decline and we could sustain as we had moved on and we had something else supporting us in that fray.
ILP: Your company has exclusive licenses of various global brands like Twentieth Century Fox, Disney, Marvel, Mattel, DreamWorks Animation, Warner Bros., Viacom, Turner, etc. for various product categories for the territory of India, Nepal, Bangladesh and Sri Lanka – what made you opt to license 3rd party brands?
MK: where are the 3rd party brands? I see all frontline brands. And a brand is a brand, isn’t it? In many ways, we went to some brands, some brands came to us. That’s how it evolved. To quote someone it was “path-breaking” It was like a friend from the industry who was a licensor at one of the licensing conferences said to me, “we had 9 companies pitching to us for the business, but we went with the 10th company who was not pitching to us”. I think the passion also shows, isn’t it? When you’re out in the market and putting a product on the shelves and how your placing the product in the stores, and then that itself becomes the center of gravity and attracts the right partners, the right brands etc.
ILP: According to the LIMA Global Study 2017 report, Entertainment/Character licensing accounts for 45% of the $262 billion sales at retail. How big do you reckon the market is in India?
MK: Market size is something I haven’t been able to nail down and everybody has their own take on it and the methodology of coming to that number is very different and very unique, but there is very little connecting those numbers either. When we talk to retailers, they have a different number compared to the wholesalers who have a different math, for the various categories and there is a lack of transparency, there are unaccounted ways of conducting businesses and all those numbers are superficially extrapolated by a particular study or entity. Very rarely have I seen these numbers become meaningful when you get onto the ground and start working. The $262 billion number does seem heartening, but in India, the 45% figure for character licensing does seem inflated. I wouldn’t put it at more than 15-20% of the overall business. Much of this has to do with how we manage characters and also we have a different consumer. Our consumer is price loyal and not brand loyal. Very often he’s happy to settle for a counterfeit which is at half or 20% cheaper than a branded product, so the quality, the utility and the price is met. That probably keeps us restricted in that space.
ILP: What are the key tick marks you must have in place before investing in a licensing programme?
MK: I wouldn’t want to put it down to any specific tick marks as we are largely driven by instincts or guts.
ILP: At the CBME 2018 panel discussion on the future of licensing, you mentioned that the growth of the licensing business would depend on the coming together of many different parts to make the overall business stronger and hit a 1-3% of retail. What are the impediments the industry currently face which need to be overcome?
MK: Yes, I think there are many impediments we need to overcome. Largely I think is the cultural impediment. We are not in a very conducive ecosystem. We have become very short-sighted “Whats on the table kind of approach” instead of thinking long term. Everything is so dynamic as well. You don’t know which retailer or brand is going to get purchased. When youre working with a licensor – 10-year relationship and you’ve nurtured a brand or character like your own, and you’ve made products standout and then suddenly…. Very often its easier to SELL than become SOLD. There are also other issues like infrastructure etc which we’ve known for years which haven’t rapidly changed either.
ILP: You are one of the largest licensees in the country, what are your expectations from a licensor?
MK: Loyalty. Its one of the most important ingredients. Loyalty and Trust. Very often a licensee goes to a licensor for a new product or category and takes It up, nurtures it over 3-4 years and builds it into something that everyone notices and suddenly everyone wants to pitch for that product category and you don’t want to be put in a place against those pitches.Its very disheartening and disorienting. If this continues, I feel the whole licensee, licensor relationship is going to stay very fractured. This change needs to come from the larger brands, the market leaders. When a small brand comes and offers you a license, you know that licensee is also going to squeeze that small company and he is going to tie in that company for 10 years or 15 years or even for perpetuity. When that becomes big the licensor has very little left to exit.
ILP: Do you have aspirations to have your own home-grown brand?
MK: Not really. We have a lot of aspirations, but we don’t have space and the time, being such a force in the licensing space. Our DNA is a licensee. Whenever there is a new character we are always trying to figure which are the categories or IPs that are best suited to take that particular character to market? We are very licensing driven, but ever so often the thought does cross our minds since we work with so many brands. But I don’t think we’ve done enough in the licensing space yet. There’s still a lot to do and a lot of growth to be achieved.
ILP: How do you gauge customer appetite for a particular brand, since you need to be ahead of the curve?
MK: The simple answer is to BE the CONSUMER and satisfy those needs. And of course, while we are handling so many brands and categories, we do have customer insights coming through our feedback channels.
ILP: Which category of your range has proved best suited for licensing? Any key learnings you would like to share?
MK: I think I’ve already answered this. All have equal potential. There’s a lot yet to be done. If there’s a less important category I would say soft toys because that is so well covered. But there is so many new IPs being launched every day. SO many new movies coming out every week.
ILP: So you feel that’s a problem now? Too many new IPs launching?
MK: I think that’s the order of the 21st century. The problem of plenty. To digress we have more people suffering from obesity issue than the starvation issue. Likewise, we have a lot of content coming in with a lot of aspirational value but not enough takers. Or the consumer seems to be overloaded with choice – too many characters and within characters too many colors, shapes, sizes, concepts and that is going to remain for a while.
ILP: You seem to have a great desire to help upcoming entrepreneurs nurture their dreams and bring their vision to fruition. How does a budding entrepreneur build a license-ready brand?
MK: I think to follow your heart. Many times we got into categories when people told us not to get into them, and we realized the more somebody was telling us NO, the more we wanted to go ahead. That’s the advice I would give. Don’t let fear or somebody else deter you from your dreams. And many times that’s where the big pot of gold is sitting and nobody is uncovering it.
Following your heart in a world of conformities is inarguably an audacious act. That is exactly what Mrinalini Chandra is doing and making it large! Her debut collection called PLEASE HAVE A SEAT showcased in Lakme Fashion Week 2014 took the fashion fraternity by storm. It was a hit and marks a humongous breakthrough in her journey.
With an urge to take handcrafted finesse to a new high, inspired by the the rich culture & poetic verses of India, trained in Fashion Luxury at the Creative Academy, Milan & NIFT, New Delhi, Mrinalini Chandra worked at Tanishq (New Delhi) and Montblanc (Germany) before launching her own label in India. She was also listed as one of Asia’s top jewelry designers by WGSN – the global trendspotting agency.
In 2017, Mrinalini collaborated with global iconic brand Candy Crush to launch an exclusive range of jewelry for women and men.
We are going to talk about all of this and more with her, a warm welcome to Mrinalini Chandra!
If you would like to listen to the interview instead of reading, scroll to the bottom and hit play!
ILP: You’ve been very busy with the Shaadi of the year – how did it feel like designing jewelry for your favorite muse Sonam Kapoor?
MC: It’s always an incredible experience to make anything for Sonam. She is the warmest person to work with and everything you make for her, she brings it to life. It is nice to see someone do justice to creativity. It was really nice to make the Kaleeras for her. She was the most resplendent bride ever; so real and traditional. In a world, where everyone is trying to be too modern and different, she stuck to the most traditional way of dressing as an Indian bride and she did all her ceremonies as they were meant to be in her Punjabi culture which was the part that I loved most about the wedding. It wasn’t about breaking any norms but doing something that she really believed in and doing it with utmost honesty. Kudos to her.
ILP: Bollywood plays by a different set of rules. How does a girl from Lucknow with no “godfather” get a foothold in the industry?
MC: That’s a very tough question to answer. I feel that I am still figuring things out in my journey and when I look back, I feel I have come a long way. I have never aimed to be in this part of the industry. I have always thought of creating a better product every time I work on a project. From the very first product that I designed to the Candy Crush project, it was always about creating something better than the last time. So, for me, this has been a very exciting journey and I am lucky to have people in the industry, who see the beauty in it and have supported me as well. Of course, the journey has its ups and downs, but it sure has been a rollercoaster ride. I am blessed with a great support system: my family, my team and my incredibly gifted karigars. The high is that if you can create the visions you have in your mind with people who have not seen it but are willing to give the chance, I think that is the most satisfying feeling of being in this field. There is no substitute to hardwork.
ILP: What does the brand Mrinalini Chandra stand for?
MC: I would like the brand to evolve into something stronger but I also want it to retain the qualities it has always had. The brand is all about evoking a sense of wonder. Every time I create something, I want people to be a little surprised by it. I want the brand to evolve into something classic – like a Dior or Chanel which becomes a part of your trousseau. If you buy earrings from me, even though they are not precious jewelry, but it is precious enough for you to relate to it, tell your story, keep your secret and pass it on to your next generation.
ILP: Since ILP is primarily about licensing, tell us about how artists, like yourself, view collaborations with global brands to reach different segments of the market or reach a completely new audience?
MC: I think it is a great way of giving an opportunity to new and upcoming talent. It helps you generate a visibility which is otherwise beyond your reach. I feel that is what luxury is all about. Someone sitting in Antwerp can place an order of something made with filigree. The best thing about collaborations is that brands from different horizons feel that there is compatibility and the result is always exciting. It brings together two cultures and people are up for newness.
ILP: Tell us about your experience partnering with global sensation Candy Crush. Jiggy George, Head, LIMA India & Founder & CEO – Dream Theatre called you one of the “most talented yet down to earth designers to work with”. What was your experience like?
MC: It was most exciting and fun experience working with on a collaboration with Candy Crush. It was not just about the collaboration but about the whole team and how it came together with everyone contributing to it in terms of not just putting in ideas but also putting their heart and spirit in it. That made it really very special to me. Since this collaboration has happened at an initial phase of my career, it has definitely been a milestone for me. I am very thankful for the faith that Mr. Jiggy George had put in me when I first met him and for him to think that this is worth investing in a young label like ours. My work is very craft oriented so for someone to see this possibility was truly visionary. I also think that the product that we made and the kind of responses that we have had, made a huge difference in the way that our label is now seen.
ILP: Any particular collaboration on the global stage that piqued your curiosity?
MC: There have been a lot of collaborations that have caught my eye in the past. I like that major international sensations of brands collaborate with artists. I find this very fascinating. Of course, a lot of brands collaborate with models and singers but not much with artists as they have very strong opinions of certain things and brands have very strong ideologies which results in a bit of a clash. However, I like that because eventually both compromise and that, for me, is a collaboration in its true sense. I really like Louis Vuitton, which is a brand known to have very commercial products, collaborating with Jeff Koons which is a very different brand altogether.
Among Indian brands, the Manish Arora collaboration with MAC was really exciting. MAC is a brand known for its classic colors and not known for its fun and spunky nature whereas Manish is known for his out-of-box thinking. I loved the packaging in this collaboration.
ILP: We interviewed art aficionado Jasmine Shah Verma sometime back and she talked about her passion for taking art out of the galleries and to the masses via everyday objects like cutlery, lampshades etc. Do you think branded jewelry also holds the same potential?
MC: I think it definitely does. Also, because branded jewelery is wearable, and the potential of wearing it, the usage is much more. In fact the Hindu called my jewelry a “wearable installation” – which I really relate to. I like it more than being called a haute couture designer because of the high utility factor. I have clients who are known for their quirkiness. Its like they say it takes one to know one.
ILP: Tell us a little bit more about your product mix and distribution platforms.
MC: I started with basically every-day jewellery category moving towards the customized wedding range with not just the massive Kaleeras and but also wedding gift products. Customization is really becoming a hallmark for me because people want something different and I am more than happy to create it for them.
ILP: Do you face the problem of piracy of your designs?
MC: Yes, I do. India has very poor laws with copyright infringement. Labels, both established and younger ones, go this route and it breaks your heart. You do not know if you should take this as a compliment because you have put your heart and soul in creating something new. I feel with some new social media pages coming up, it is easier to shout out and point out piracy and it has noticed that people are in support of anti-piracy. That is very helpful and encouraging to us. I believe the consumer is not so unaware anymore, is more educated and smarter and because of social media exposure their knowledge is better. You cannot fool anyone so easily anymore.
ILP: Although the overall consumption of gold dipped last year vs the average over the past decade, India is still the 2nd highest consumer of gold behind China according to the World Gold Council. Are you looking at other precious or semi-precious metals to de-risk?
MC: Since I have started working, we have most commonly dealt with 24-karat, 22-karat and diamonds in 18-karat. Now what we see is, something very typical to Dubai, an offering from a 9-karat to a 14-karat which is becoming very prominent in India. In fact, I am myself working on a line like that. Silver jewelry has always been there. Precious stones are not so popular in India unless they are combined with white or yellow gold. Because platinum jewelry has a higher price point, I don’t see it working so much for women as much as wedding bands for men which would work. I do not see gold disappearing from an Indian market point of view. The younger women now still prefer gold but with a modern outlook. In a pret way, I see gold in 9 – 14 karat continuing to grow.
ILP: How do you balance art & commerce?
MC: That is the hardest thing I have ever had to do because when I am creating something I don’t want to think about how to monetize it. But sadly, I have to. Aditya, my husband, has taught me the importance of commerce and how to balance it with art.
ILP: Which designers do you draw inspiration from?
MC: In India, it would be Anamika Khanna. I have been a big fan of her since I was in college. I happened to interact with her just after my first show. She just stopped by to buy the products in the stall area. She said my products really caught her eye and commended me on it. That moment meant a lot to me. All her clothes are like an artwork which does not follow a regular pattern making process. I think she does draping on a mannequin and it comes off as an original. I don’t think she is a person who would compromise on the amount of work she wants to put in her designs which I really like and follow in my line of work as well. I would not like to compromise on my products. Sometimes the product gives minimal profit, but at the end of the day it is the client satisfaction that really matters.
On the international scene, I love many jewelry designers and follow their work. One of them if Jacqueline Ryan who takes her inspiration from Greens – its 3D jewelry. I’m not very clued into their personal lives, but I love their work and continue to follow them.
Its not easy to get time with Mr. Anuj Batra. so when you receive a message that he’s free to have a quick chat, you take it. A veteran in the retail space, Mr Batra shares his experiences with IndiaLicensingPost.com.
If you prefer to listen instead of reading, scroll down to the end of the page and hit play.
You have worn many different hats throughout your career,with a strong background in retail & infrastructure. What made you join Alcis sports?
I have been in the retail and distribution profession for nearly 30 years. I have had the privilege of launching some iconic brands in various different sectors like footwear, apparel, garments, accessories, wellness, education and so on. The Indian sports apparel market is still in the nascent stage and I have seen a great amount of opportunity where many international brands were doing very well,however, 90% of brands were not focusing on the target audience that exists in India. By that I mean, there are so many players in India who are only concentrating on the top end of the pyramid whereas the mid and the bottom end has any brands and that is where the entire customer base in India lies. So we wanted to give the best international quality product at Indian prices to the consumers. With that in my mind, I saw a great opportunity of joining Alcis, which was actually being promoted by one of the largest sports apparel manufacturers out of India. I have had the expertise for making it for some iconic international brands as well as many Indian brands into the sports and leisure segment. So, the expertise was there in terms of manufacturing and curating something very different in terms of quality and I have got the expertise in go-to-market strategies and channel development.
Do you believe the business of sports licensing is coming/has come of age in India?
Definitely! The overall Indian consumer, while growing up, always had a fancy for icons that they could relate to. We have grown up hearing stories, watching movies and serials and that is how we have connected to these superheroes. We dream and fantasize to be like them in our day to day life. In India as well, we have been growing among these characters that are more than life-like and these superheroes are being projecting in such a way that we see ourselves in them and vice versa. It becomes an easier platform for people to relate to and this is the reason why most of the organizations relate themselves to a brand, icon, license or character as it becomes easy for them to establish their product within the domestic market.
What are the key tick marks you must have in place before investing in a licensing program?
The first and foremost tick mark we should have is on the overall positioning of the brand. It has to synergize with the kind of license or character we are trying associate with for our product range. Another important factor is that the license program has to be along term factor. When a brand is investing huge amount of money to obtain a license, they need to ensure that the top and bottom line of the pyramid are covered. Create a range and build up a brand around the character. The ultimate goal would be to see whether we are able to make money out of it and do justice to the brand we are trying to associate ourselves with. There has to be a two-way synergy where the brand is able to grow along with the character.
What are your expectations from the licensor/brand owner?
I would say that the brand ethos should not be compromised with, whether the licensee they have signed up with is able to work out a long term strategy or build the brand around their product. It is very important to report true sales figures. Being forthright and ethical is very crucial for a license and a brand to go hand in hand for a long term vision. Getting royalty payments on time is very important as well for a licensor.
How do you gauge customer appetite for a brand?
India is blessed to have so many consumers. The sheer size of the population itself is enough for us to get sizable numbers for any licensed program or a brand to successfully launch a property in India and become successful.
Give us an example of a great licensed brand fit with your product?
Essentially, Alcis is all about sports apparels and we make a very diverse and unique range of sports products. We have a separate range for running, training, yoga, work-out, cricket and football. There is a huge amount of possibility for us to relate with any of the icons within this entire spectrum of categories that we are manufacturing for and to be able to bring around a brand which can fit into our brand activities. And this is why we had signed up with the iconic Shikhar Dhawan as our brand ambassador who was truly echoing the brand promise that we were trying to portray and position ourselves with. In the women’s category, we have Lauren Gottlieb who is considered to be one of the iconic figures for a lot of young women who aspire to be like her.
You are the official licensee partner for FIFA World Cup 2018. What are some of the initiatives you are undertaking to excite fans in the run up to the event?
We were licensees for the Under-17 FIFA World Cup that happened in India and we took some beautiful initiatives of promoting the 10 million program. We also took the initiative of setting up stalls at various stadiums, discussed with other sponsors of FIFA World Cup in India like Bank of Baroda, Coca Cola, Hyundai, Hero, etc to get a sense of getting consumer feedback in terms of people trying our various products, appreciating the quality and technological advances that we are offering in our product range. For the FIFA World Cup 2018, our products will be available at Lifestyle, Shoppers Stop, Central, and Sports Station along with some multi-brand outlets across the country. We have also opened up 7 exclusive stores for Alcis where the FIFA range will be merchandised. Before the World Cup begins, we will start additional 3 stores mainly in Goa which predominantly has a strong football fan base along with Hyderabad and Bangalore. We are also going to take initiatives at Lulu Mall in Kochi which again is a city of football fans. We are trying to tie up with sponsors across other countries to promote our products and range and get ourselves associated with football academies. We are offering 555 different SKU’s in the entire FIFA range which includes both men and women. For the first time, we are launching merchandise for women/girls and kids. We have also tied up exclusively with Flipkart to launch this entire range nationwide for the online channel.
Any key learnings you would like to share regarding your journey as a licensee of some of the biggest and well known brands in the market?
I would say we need to be reciprocal whether it is a brand or a licensee. There should not be different licenses given in a particular market for different categories but within the same range. At the same time, it is very important for the licensee to be able to honor the commitment and to be able to give justice to the brand. Before signing up the license program, it is very important to work on a business plan and share it.
You have launched on your campaign “Be The Game” featuring Shikhar Dhawan – pls tell us a little more about the background and its objective.
Each one of us, irrespective of age, still love sports like football and cricket. We also try and discover our younger years where we participated in school or college sports teams. Some of us still continue this hobby in spite of our office schedules in order to stay fit. So it is all about being the game where we are trying to help people to talk about how we can live in our present age and still be active like a sportsman. The entire Alcis range are technologically advanced products which help people to perform better in what they are trying to do. We are shortly building up that story and you should hear about our big plans very soon.
What advice would you give to young professionals starting out in the licensing business?
Being a jury member for WSE (World Startup Expo, Bangalore) and Narsee Monjee, I can surely advise that licensing and sports management is a great opportunity in India. Licensing is going to become more prominent in India with its spectrum not restricting to only FMCG or apparels and it will be a great career to be in. It definitely has a great amount of scope and one should encourage their kids to be able to take up this program and also take this as a full-time career.
Tell us more about why you did you see it fit to push into the retail sales. Is it primarily for the touch-and-feel experience vis-à-vis shopping on an online portal?
Our entire positioning goes around the factor that the product needs to be seen and how will the consumer be aware without the touch and feel about gauging the quality and seeing the technology in front of them. So it is very important for us to create a great amount of physical presence. So far, the entire range of our sports apparel is available through more than 264 large format retail outlets and across 700 retail points which are the multi-brand retail outlets being serviced through our chain of distributors. We are also having presence in 7 of our exclusive stores and in the process of opening another 15 stores this year. The one-to-one interaction with our products is very important for us to promote our products. For example, they need to know how it feels to wear our lightweight product of 76gms or the Wonder Tee product which is made out of recycled polyester. Our market strategy is going to be a crucial factor as we plan to have our presence in more than 2000 retail outlets across India this year. We have also tied up with Walmart to sell across various retail points which would have been difficult for us to reach through our present distribution network.
What is your take on piracy? In more mature markets in the West, they do have laws to tackle such issues but in India we lack such stringent laws. How do you view piracy and what steps do you think the licensors and licensees should take to secure their future in the market?:
With the IPL tournament happening, one might have seen the players wearing a very discerning product range. Our parent brand, Paragon Sports Apparels, is very fortunate to manufacture it for various different brands for the last 11 years of IPL mainly Mumbai Indians, Kolkata Knight Riders and Royal Challengers Bengaluru. During the matches, you may have noticed thousands of fans wearing similar looking products most of them which are not manufactured under licensed programs of the IPL franchises. The government has to take some steps in order to strengthen the trademark and reinvent laws to take a quick action on piracy. The licensor and licensee need to join hands in order to curb this issue and try to raise the issue at various forums and with the government. The online channel players or retailers should not be allowed to sell dubious products which are not licensed. Once we have stringent laws across this spectrum, this problem can be taken care of. Also, as a customer, one should pledge not to buy a dubious product.