We caught up with Mr. Permendra Singh aka Param – Head, Consumer products, Mattel India at his very swanky (and funky) office in the hip-side of Bandra East! If you love your Hotwheels (who doesn’t?), scrabble or Barbie – then this place is nothing short of “heaven” – but duty calls and we get down to discussing the business of licensing.
For a radio like experience you can listen to the conversation at the bottom of the page or have a read!
ILP:You have worn many different hats throughout your career,with a strong background in retail &sales. Was joining Mattel a natural progression, how has the journey been thus far?
Param:My experience has primarily been in Sales Management & Marketing before I got introduced to Disney – the licensing world is beautiful & you generate business by collaborating & influencing the right partners. The business model gives one a lot of flexibility & allows to explore multiple categories. You can only be limited by your ambition to grow. Mattel boasts of the iconic brands like Barbie, Hot Wheels, Fisher Price – in today’s age every brand is looking at ways to engage with their consumers & here the brands are built purely on engagement. Hence, working at Mattel becomes a perfect fit for me.
ILP:You have possibly 2 of the most iconic brands in the kid’s space – Barbie and Hot Wheels. How does this play out in the licensing space where you’re up against the biggies?
Param:As mentioned the challenge for most of the brands today is the engagement & here are the Mattel Brands – Barbie, Hot Wheels & Fisher Price that are built primarily on the engagement apart from the content. The way the consumer engages or plays with Hot Wheels Car or the Barbie Doll makes the brand an integral part of the play & learn journey for the child & hence these brands are iconic. In fact, given the neutral retail environment these brands literally tower over the rest Licensing brands & hence we see an untapped market with a strong growth forecast in key categories.
ILP:What are the key tick marks you must have in place before bringing in a new licensee on board?
Param: OK, so this is something like what is the perfect recipie to a butter chicken. Slightly tough one to answer but there are some basic principles to making the Licensing partnership successful & the key aspects to the Licensee includes:
- Passion & belief in the Franchises that the Licensee wants to work upon.
- Category Expertise.
- Make Licensing a part of their long-term strategy.
- Transparency & open to feedback.
- Nimble & Proactive Approach to scenarios.
- Financial Discipline.
ILP:How has the proliferation of digital devices and high-speed broadband impacted Mattel in India and overseas?Has it helped acquire new consumers on the content front?
Param: The country is presently seeing a rapid growth in terms of digital content consumption and users are today able to seamlessly experience the content they love to watch. All of this has been made possible due to affordability of smartphones and cheap data rates being available.
As a company, we believe that storytelling becomes a cornerstone in our approach to connect with kids and parents. We have achieved this by providing a rich selection of content to connect with kids via leading OTT platforms such Youtube Kids, Netflix, Amazon Prime and Voot. Outside of OTT platforms, we also have an established social media presence by which we engage with parents and fans daily. We are presently undergoing a revolutionary change in the way kids/parents consume digital content where it becomes imperative for us to build our business around them by delivering a narrative that resonates with them.
ILP:How has the growth of E-commerce impacted the licensing business for Mattel in India?
Param: If we look at the last 5 years, ecommerce has seen an incredible growth rate of internet penetration in the country which in turn has also led to a fast-growing online shopper’s community. In 2016, the e-commerce market comprised of only 2% of the overall retail market which is expected to grow to 12% by 2026, as stated in the Morgan Stanley report titled – India’s Digital Leap.
At Mattel, we see this growth as an opportunity to scale up our business by offering a seamless omnichannel experience to our customers to shop what they want and when they want. More importantly, the channel helps us to overcome distribution challenges that existed earlier and today we can connect with our customers across the country.
Over the past year, we have invested heavily in strengthening our e-commerce partnerships. We launched exclusive stores for our brands – Barbie, Fisher-Price and Hot Wheels on platforms like Amazon, Flipkart and Firstcry. We recently also initiated an occasion led shopping event with Flipkart on Barbie’s birthday in March. Moving forward, we will continue to invest in this channel to reach out to our consumers more efficiently.
ILP:With the growth in private labels, do you see Direct to Retail also growing as a business proposition and in helping retail drive value?
Param:Yes the private label will grow primarily in organized retail including E-commerce. With low net margins for retailers worldwide the focus on private label to improve the realisations is natural. We have seen certain private label brands growing tremendously in last 10 years & the same will continue provided they are focused in their offering & in line with what consumer is seeking.
Licensing has gained & grown a lot as part of the private label by key retailers.
ILP:Any key learnings you would like to share as a licensor of some of the biggest and well-known brands in the market?
Param:Licensing is all about believing in the partnership & being completely committed to it – the key cornerstone for the business is the trust between the Licensee & Licensor. The relationship needs to involve positive push to each-other to build the business. The framework & success matrix needs to be clearly defined & worked upon. If there is passion & commitment the journey is fun & results are always there for others to notice as a case-study of what went well.Its all about making it successful on these.
ILP:What do you feel is lacking in the Indian licensing eco-system which could bring about a watershed of change and progress?
Param:The way we build the partnership – Licensee & Licensor needs to be a lot more engaging & needs a stronger collaborative approach. They need to move & build business like a Tribe.
The key area is the engagement or consumption of content is far leading the consumption of consumer products & need to be tapped at the right pace. The eight-year old inTiripur orTezpur have quite a similar urge to owning the Barbie T-Shirt as the eight-year old in Mumbai & hence distribution is the key driver going forward.
ILP:Mattel does a lot of CSR work in the US especially around the ‘Power of Play’. Are we likely to see such initiatives in India as well?
Param: Mattel is a creations company that inspires the wonder of childhood and one of our core beliefs lies in the value of play. According to American Academy of Pediatrics, Play is essential to development because it contributes to the cognitive, physical, social, and emotional well-being of children and youth. Play also offers an ideal opportunity for parents to engage with their children and we have been making concerted efforts to educate parents about the underlying benefits of play with toys. It is our mission to be the recognized leader in play, learning and development not just in India but across the world as well. We are extremely committed to investing in product development and, thus, focus heavily on R&D to solve fundamental problems that parents face with baby products and child development. It is our constant endeavor to not only keep the child engaged but also make life easier for the parents by providing best-in-class, safe and quality toys that aid in the be overall growth and development of the child. We are committed to bringing this thought alive through all our initiatives – be it engagement with parents or through our product development. Through the Mattel Children’s Foundation, we have awarded a grant of INR 15 Lakhs to launch Project Udaan under the aegis of Barbie, in association with Masoom, an NGO that offers quality education in night schools for girls from marginalized sections of society. This was in line with Barbie’s philosophy of ‘You Can Be Anything’ and the program was 3-fold that focused on leadership skills, feminine hygiene program and vocational training.
ILP:What advise would you give to young professionals starting out in the licensing business?
Param:It is a model that offers great flexibility & you can marry the basic principles of Sales & Marketing to build large businesses. This is a fast-growing business & primarily driven by Franchisees that connect emotionally to the consumers. The business also feeds continuously upon the Consumer Products to build the brand with so-many touch-points. The key principles are passion in the brand & collaborative approach to building large partnerships.
It brings immense possibilities & sky can be the limit in terms of the revenue that one can target. Companies are now making Licensing as part of their long-term strategy & you can have a fascinating career with good career progression. The cross-category mix adds a lot to the learning as an individual.
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