Masks have become of the face of the battle against the coronavirus and are taking a little more style and flair. And, inevitably, characters, logos and designs of all sorts have begun to pop up to cover mouths and noses. As far as we can tell, they’re rarely, if ever licensed. (We have no idea whether the masks above via Etsy are licensed; they merely illustrate the ubiquity of merchandise flooding the online world.)
A quick trip through the maker marketplaces is instructive. Going into the weekend, Etsy maker Kawaii Dress Shop had a line with Disney characters including Maleficent, Snow Queen Elsa from Frozen and Cinderella, all priced at $19. Turkey-based Art Plus had a version with Vincent Van Gogh’s Irises artwork on Zazzle, while Etsy maker Back Stitch Beauty was selling Sesame Streetcharacter face masks in men’s, women’s and children’s sizes.
A Disney spokeswoman declined to comment, and a Sesame Workshop spokeswoman said the design we cited isn’t licensed but declined further comment. Spokespersons for the Van Gogh Museum, Etsy and Zazzle couldn’t be reached.
Brand Owner Dilemma
Brand owners are in a ticklish situation – needing to maintain control over their characters, logos and other IP, but not wanting to come within miles of being perceived as profiteers during a crisis. They also have to be concerned about potential liability if, for example, a character-adorned mask is sold to somebody who thinks they’re buying rock-solid protection and subsequently gets sick.
When Etsy CEO Josh Silverman said in an interview last week that the number of its makers producing cloth masks had increased fivefold to 20,000 during the prior weekend, he also hastened to add that “the CDC itself has said a fabric face mask is probably better than nothing but please do not assume that this keeps you or the people around you safe. It’s an additive measure. It’s not preventative.”
So even as they pitch in to the collective effort, brand owners are conscious of walking a fine line. Natasha Fishman, EVP of Marketing at Authentic Brands Group, (ABG) acknowledged that if the state or federal government mandates wearing face masks, ABG would likely initially give them away to healthcare workers. ABG’s Hickey Freeman division currently is making masks using hospital-provided surgical curtains and distributing back to hospitals in the Rochester, NY area.
The goal is not to profit off the pandemic because “clearly there is a need , and that need starts from healthcare workers, then other essential workers,” Fishman said. But “then it will translate to bringing product to people that becomes part of their personality for PPE.”
Longer term, ABG will make about a dozen of its more than 50 brands available for licensed masks, says an ABG spokesperson. The first ecommerce sales are expected to launch in the next few weeks.
“Up until a few weeks ago, Americans really didn’t wear masks,” says the ABG spokeswoman. “And going forward [a key element] it will be aligning with a real charity. Brands partner with charities because they want to have a purpose that creates an authentic connection and we will see more of that. Once people stop buying masks frantically, charities will be a key component and eventually it will be OK for companies to make money from face masks.”
The sharp rise in sales of puzzles, games and building sets ( widely publicized and extremely logical in these “shelter in place” times) has seen the continued emergence of “kidults” — grownups filled with nostalgia and perhaps seeking out new activities – as a driving force in those categories that was underway even before the pandemic struck.
The crisis has only added fuel to the fire. “In my opinion, some of this growth [in games, puzzles and construction sets] is coming from adult sales,” says Julie Lennett, NPD Group’s leading toy authority. “We’re seeing strong growth in adult puzzles, expensive and more complex LEGO sets, and ‘adult’ games like Cards Against Humanity and Settlers of Catan. Even adults are looking for a way to escape the chaos in their lives and toys can be a great distraction.”
For example, in the UK and Australia, Lego’s Technic Bugatti Chiron and Land Rover Defender construction kits – both of which have more than 2,000 pieces and are priced around the equivalent of US$280 — were among the Top 10 selling products in the games/puzzles/building sets category in the weeks ended March 21 and 29, respectively, according to NPD. And the UK’s John Lewis department store chain said sales of puzzles in the week ended March 29 were higher than during the Christmas holidays and that more than half its stock – including all 1,000-piece versions, which are mostly aimed well beyond younger age groups — was sold.
“Kidults is something that applies to puzzles, because it is something that reminds you of your childhood. In the current situation, it is definitely helping to drive sales,” says Melissa Dragonas, a Product Manager at Ravensburger USA. Indeed, the company’s sales of puzzles rose 370% during the past few weeks, and while children’s products led the category — Disney Collector’s Edition, Villainous, Frozen 2 and Toy Story 4 puzzles were top sellers — adult puzzles “weren’t far behind,” says Dragonas.
The rise in games, puzzles, and building set sales wasn’t limited to one global market. While sales of games and puzzles were up 228% in the U.S. in the week ended March 21, they also skyrocketed in the UK (240%), France (122% for puzzles; 83% for games), and Australia (417%), according to NPD. In the UK, games and puzzles also more than doubled to 21% its share of toys sales in the week ended March 21. In the case of building sets, sales soared in the U.S. (76%), UK (59%) and Australia (155%).
The increase in sales hasn’t been limited to mass merchants and toy stores. Etsy’s sales of puzzles and games were “more stable” in March along with those of bath and beauty and self-care, CEO Josh Silverman told investors. Those sales offset a sharp decline more typical top sellers in March such as jewelry and wedding-related items, the purchases of which were delayed as weddings were postponed, Silverman said.
“We have some games that are moving up in the ranks like Monopoly and Uno for obvious reasons, because these are like comfort food,” says NPD’s Lennett. But whether that trend continues after the coronavirus outbreak abates, “remains to be seen. There is the potential that families rediscover (or discover) the joy that playing family games has on the family. I hope that happens, but we’re in unusual times and I don’t think anyone can predict what families will be doing in a month or six months.”
Everett, WA — Funko is furloughing employees effective Sunday and cutting salaries to give it financial flexibility in the wake of the coronavirus outbreak.
Funko also is:
Executing reductions in operating expenses and non-product development capital expenditures; and
Proactively managing working capital, including reducing incoming inventory to align with anticipated sales.
In addition to these actions, Funko is evaluating further options to increase flexibility and retain liquidity. Since December 31, 2019, the Company repaid all outstanding borrowings on its $75 million revolving credit facility and subsequently drew down approximately $29 million. As of March 31, 2020, the Company expects to have over $50 million of cash on hand and $46 million of availability on its revolving credit facility.
“During this uncertain and unprecedented time, it is essential we take actions to best position Funko for our employees, partners and shareholders,” stated Brian Mariotti, Chief Executive Officer. “We are making difficult decisions that we believe will put us in a position of strength to navigate this crisis and support the long-term health of our Company.”
Headquartered in Everett, Washington, Funko is a leading pop culture consumer products company. Funko designs, sources and distributes licensed pop culture products across multiple categories, including vinyl figures, action toys, plush, apparel, housewares and accessories for consumers who seek tangible ways to connect with their favorite pop culture brands and characters. Learn more at https://funko.com/, and follow us on Twitter (@OriginalFunko) and Instagram (@OriginalFunko).
In this period of pain and adjustment, when we’re all inundated by a flood of bad news and surrounded by the effects of the Coronavirus outbreak, we decided to begin the week with a look at some of the ways that companies in and around the licensing business are stepping up and making a contribution.
A vast number of companies are making huge financial donations to help fund such things as relief efforts for the needy, financial help for workers who have lost their jobs due to the financial upheaval and aid for health workers.
Some companies also are lending their talents, facilities and supply chains to the effort. Those cited below are only a sampling, but we hope it gives a dash of inspiration about what’s possible, and how people and companies around the world are pulling together to try to make a difference.
Fanatics is manufacturing masks (shown above) and gowns out of material originally destined for Major League Baseball jerseys in its Easton, PA facility. The program is totally funded by MLB and Fanatics.
Burberry is dipping into its global supply chain to “fast-track the delivery of over 100,000 surgical masks to the UK National Health Service,” among several other measures.
My Icon Story has launched a free greeting card initiative aimed at getting cards sent to those in need, be they shut-ins, health workers or others.
Careismatic Brands donated $1 million worth of Cherokee and Dickies branded scrubs to impacted hospitals across the U.S., specifically for healthcare workers on the front lines of COVID-19.
Crazy Aaron’s switched from manufacturing its Thinking Putty to producing hand sanitizer.
MGA Entertainment, in addition to helping source masks and other medical supplies, is retooling its Little Tikes toy factory in Ohio to produce ventilator valves and googles for hospitals, Forbes reported.
Major European fashion companies owned by Kering and LVMH, as well as such retailers as H&M and Zara, said they will either source or retool their supply chains to produce masks and other medical equipment.
A great opportunity to listen to Green Gold TV’s founder & CEO Rajiv Chilaka’s journey from sketch to screen to a licensing phenomenon which he has built along with his team. You can learn about one of India’s MOST famous kids animated franchise Chhota Bheem in a session moderated by Jiggy George, Country MD, Licensing International India. This a FREE opportunity for everyone courtesy Licensing International supported by License India. Hope see you on this Friday at 6pm. Click on the link to register https://bit.ly/2u0MkNL
If you are associated with the licensing & merchandising business or retail industry at large, please encourage your teams to join and participate. They will be in for a treat.
Chhota Bheem’s creator, Rajiv Chilaka discusses the success story on Licensing International’s Webinar on 17th January at 6 pm IST
A great opportunity to learn about the journey from sketch to screen to licensing phenomenon of One of India’s MOST famous kids animated franchise in a session moderated by Jiggy George, Country MD, Licensing International India. This a FREE opportunity for everyone courtesy Licensing International supported by License India. We invite everyone to join!
The Licensing International Webinar seeks to create a knowledge platform for entrepreneurs to engage with stalwarts from the licensing fraternity in an effort to build & expand their business.
Following up on our sessions with Ashish Saxena (Bradford) & Susmita Singh Deo (Dream Theatre Group) during the India Licensing Expo earlier this year & recently with Anand Singh – Senior Director, Cartoon Network Enterprises, South Asia, joining us next for a session is Mr. Rajiv Chilaka – Founder & CEO, Green Gold Group. He will be sharing his knowledge & fantastic journey creating some of the most iconic & well-loved characters like Chhota Bheem, Mighty Little Bheem and others.
An alumnus of the Academy of Art, San Francisco, USA, Mr. Rajiv Chilaka’s entrepreneurial journey started with a vision of creating an animation studio at par with the best in the world. This took shape with the establishment of Green Gold Animation in 2004. In an industry still in its nascent stages, his journey was punctuated with more challenges than opportunities. Braving the odds, he created and brought India’s most loved and iconic character, Chhota Bheem, to life.
Today, as the CEO of the Green Gold Group, he leads a team of over 1400 artists who have produced over 10 shows, 750 episodes, 90+ TV movies and 6 Feature films in the last decade itself. Green Gold Group’s footprint spans across television, movies, digital and L&M reaching an audience of over 150 million kids across 190 countries. It also owns and licenses India’s biggest children’s IP with over 100 brands across multiple categories.
Under his leadership, Green Gold Animation has won many accolades and achieved many a milestone, the most recent being the creator of India’s first Netflix original animation series, Mighty Little Bheem. A global success, Mighty Little Bheem is a testament to the spirit of creation that drives Rajiv and the Green Gold Group.
Commenting on his participation in this initiative Rajiv says “The immense love for and the acceptance of Chhota Bheem by the kids led us down the licensing path. We honestly weren’t ready for the response to Bheem and took some time to realise that our audience wanted much more than to just watch Bheem on television. We had to learn and manoeuvre a licensing world dominated by international characters. An interesting journey but could have been shorter. I laud the efforts of Licensing International for their efforts to help, educate and grow licensing worldwide.”
Jiggy George, Country MD, Licensing International India and Founder CEO, Dream Theatre, who is widely regarded as the go to person for all matters licensing as well as in the media & entertainment space having set up the licensing businesses at Turner International & MTV will be moderating the session. Speaking about the session, Jiggy said, “ Chotta Bheem is the first Indian IP to breakout into a bona-fide licensing success story in a market dominated by international properties. Rajiv’s and his team’s understanding of the market and their approach to licensing is both out of the box and inspiring. There is a lot to learn from their phenomenal journey”.
Green Gold Animation is a pioneer in creating original Indian animation content and has been entertaining the young generation for over a decade. The shows produced by Green Gold have been hugely popular across all leading kids TV channels like Cartoon Network, Pogo, Discovery Kids, Hungama & Disney, as well as OTT platforms like Netflix, Amazon Prime Video, Voot etc drawing an active viewership of over 150 million kids. The popularity of the characters created by Green Gold has transcended over the years and it has helped the company establish itself as a leading player in Licensing & Merchandising, Movie Production & Distribution, Digital Business, Retail Stores and Events.
About Dream Theatre Group:
Dream Theatre represents some of the most iconic brands in the entertainment, sports and fashion licensing space. Over time, Dream Theatre Group has evolved its model from pure representation to creating their own brands, syndicating content and distributing merchandise.
Licensing International has been at the center of the multi-billion-dollar worldwide licensing industry for 35 years, helping companies profitably grow their businesses through an unparalleled network of information and membership.
Smart licensing is the fastest and most profitable way to grow a business and maximize brand value in any industry. That is why, every day, Licensing International works to foster the growth and expansion of licensing around the world, raise the level of professionalism for licensing practitioners, and create greater awareness of the benefits of licensing to the business community at large.
If you’ve always wanted to learn about the $280 billion* global licensing & merchandising business, you NEED to get a seat inside The Licensing Room, a webinar series for aspiring entrepreneurs co-hosted by Licensing International India & License India. We are kicking things off this week by discussing the largest category (by share and revenue) Character & Entertainment licensing (43.8% share, $122.6 billion at retail) according to Licensing International’s Global Licensing Survey 2019.
The Licensing Room is meant to create a knowledge-sharing platform for entrepreneurs to engage with stalwarts from the licensing fraternity in an effort to build & expand their business.
We kicked off the first webinar on 25th June 2019 prior to the 3rd edition of the India Licensing Expo and hope to have a webinar every other month till the end of 2020.
Some of the reasons we decided to go online instead of offline.
Use technology to minimize logistics for both speakers and the audience and maximize reach
Remove geographical limitations which exist when trying to plan an on-ground event
Longevity – the webinar assets will reside on Licensing International & License India’s websites thereby increasing the longevity and ability to reference it long after the event has ended.
Access Anywhere, Anytime – the webinar can be accessed from any mobile device either at work or on the move.
Benefits to the speakers:
An Opportunity to share their time and wisdom with participants from the trade to next-generation entrepreneurs
Help enhance the licensing ecosystem in the country through their thought leadership
Avoid physical travel to a particular location to deliver a presentation amidst a hectic schedule.
Jiggy George, Head, Licensing International India is ecstatic to see the wheels finally turning. With D-day around the corner, his enthusiasm is palpable.
“We’ve been planning this for some time now but because of hectic travel schedules, getting a slot in the right folk’s calendars proved to be daunting. We are so glad Anand decided to hit the “Confirm” button for this session on the extremely dynamic and burgeoning Entertainment & Character licensing category. We are sure it will prove to be time well spent for existing licensing executives as well as entrepreneurs looking to build sustainable businesses in this space”
To register for the webinar visit licensinginternational.org/india
Licensing International’s Sharon Weisman gives her run down from the show floor of BLE 2019.
What looks like Javits from the outside, seems like Licensing Expo from the inside and has massive growth potential?
Brand Licensing Europe 2019, of course!
At this point, there is no value in comparing the ExCel Brand Licensing Europe to the shows which took place at Olympia.
I was part of the team that shifted Licensing Expo from New York to Las Vegas. It took a while to accept, but now no one is looking back.
With the move to ExCeL there is absolutely no complaint that has been made that can’t be addressed by Informa and Licensing international, and solved by next year.
The only thing we still need to figure out is where is the London EyeCandy (otherwise known as the new Hand & Flower).
Three key take backs from the show:
The BLE show floor make-up resembled Vegas in a way. However, it was actually great not to see ridiculously huge stands. After all, the booth-pissing-match (British translation: Stand-Willy-Waving) doesn’t correlate with how healthy a company’s licensing business really is. The important thing is that everyone was hustling Dolly Parton style… from 9-5.
Speaking of 9 to 5, the most valid points made:
Lots of people scheduled 5pm meetings but were asked to leave as the show floor closed at that time (what a great problem to have, and easy to solved).
The absence of stand numbers/signage on the floor (and the fancy open booths didn’t have them on their structure either) #easyfix
The show floor should be merchandised better (neighborhoods/sections) #easyfix
My Jew-Crew – it did not bruise my ego to find out (once again) that attendance wasn’t dramatically affected by the overlap with the Jewish holiday (+3%). The expo’s new management cares deeply and is very sensitive to this issue. I expect attendance to sky rocket next year.
Amenities were superior – accessible, more options, shorter line and significantly less expensive. I’ve heard people crying about the venue running out of food or accepting cash only on the first day. However, these issues were resolved the following day.
Heck, I’m so happy there’s a Starbucks (I have heard Americans refering to it as the ‘Sanctuary’) offering Oat Milk Lattes for high maintenance pains such as yours truly.
I experienced lots of ‘learning moments’ on the first day of the show. Things to consider: not landing at Heathrow, taking an Uber from the Jubilee station instead of the DLR on rush hours, and staying closer to the venue (I loved the Moxy… but I’m also the size of the Mr. Men characters and live out of my suitcase…).
Commute options will be addressed for next year – from a direct line to shuttles.
Licensees exhibiting – and why not? It shows the full spectrum of our industry: from IP to CP. Tangible merchandise completes the circle along futuristic IP pitch decks. Licensees can showcase their lines, coordinate meetings with retailers and brand owners and support their licensors.
In contrast to the stimulating manufacturer’s stands, however, there are agents… I am going to get serious heat from my agent friends on this, but I’m going to call out most big agents for not doing their clients justice, aggregating a bunch of logos on what ends up looking like the saddest stands on the floor. This clashes with all the hard work they put into creating licensing programmes for amazing brands. ABG (brand management), I’m looking at you, too… I felt like I should take a number and wait to get my root canel at the stand.
With that said, shout out to IMG Europe for spinning off three additional separate stands: Fabacus (a new service which looks to streamline communications between its clients and licensees), Jeep and UEFA Euro 2020.
Ever(er)green? My definition for an evergreen was always a brand that was able to engage at least two generations. An IP parents can’t wait to introduce to their kids (and then grandkids). These brands possess qualities that stand the test of time and keep on evolving in order to resonate with the new generations.
BLE 2019 made a point for brands having a longer shelf-life in Europe (Thomas, Moomin, BarbaraPapa, Smurfs, Peanuts, Care Bears, Pink Panther and more).
Fashion – collabs by Coca-Cola, Peanuts, Hello Kitty, Chupa Chups, National History Museum and FatFace and more were highlighted at the show.
But let’s be honest now, these aren’t the mainstream fashion brands licensing beyond their core business. These are mostly timely/limited deals by lifestyle/character brands with designers or luxury brands orchestrated with two goals in mind: capturing quickest ROI and appealing to new generations.
The mass fashion brands, that significantly grew their business via licensing, are under-indexed at the show, because they are in a Pilates class right now, figuring out how to strengthen their core. Therefore, it was no surprise when Informa announced the theme for BLE 2020… yep, you guessed it… fashion.
Another sub-trend that is on fire is the FF or FSquare = Food Fashion!
Mentos x Sanrio, the White Claw Craze in the US, McDonalds RFP (may the best agent win), Brand Central plans for Heinz, licensees wanting fast food and snack brands for apparel lines…
Gaming – PowerStation Studios did a stellar job creating centralised excitement in the middle of the ‘show universe’. This activation centre, coined The Arcade, functioned as the heart of the show, pumping people in and out from all corners of the show floor – enabling exhibitors and attendees to engage, play and experience. #StandonSteroids
There is no wonder the Licensing International Global Survey found that gaming is the licensing category with the most dramatic revenue increase in the past couple of years.
Participants included Bioworld, SEGA, Bandai, Activision, Disguise, Sybo, etc.
Sustainability – it’s on everyone’s agenda. Hopefully, you all caught the session discussing this topic at the Licensing Academy. While most of the conversations tackle how our industry increases awareness and steps into the sustainability game in the future, companies like Hasbro are championing the strategy by phasing out all plastics used to package its toys and games by the end of 2022.
Diversity and inclusion – is on every brand’s mind. Cause-based marketing is key in order to win over new generations. The non-binary Mattel doll, more neutral colours by licensees, retailers requesting merch that would appeal to women in gaming, as well as merchandise by TikTok GIRL gamer influencers.
Licensing International formed the first Diversity and Inclusion committee spearheaded by Jamie Stevens @ Sony Pictures, committed to actionable objectives that will lead to change.
Buyers buying more than product – buyers being more dependent on the licensing execs to get the right products, talent and activations into the stores.
The Social Store, Attachment London, ABG, WMG and others have been reporting helping their retailer partners attaching talent promotions to the merchandise and creating experiential opportunities.
Data – licensors are cracking down on licensees as well as agents for reports and analysis of the right data. Collecting data regarding products will help better forecasting and fulfilment, creating superior product and more targeted lines.
No wonder companies like Flowhaven, Fabacus, Octane5, Brainbase and more have recognised a need and are multiplying like rabbits. Moreover, I met with many more companies at the show this year that are offering brands a partnership beyond licensing, and one of the main selling points of an app-based partnership is the data collection.
Stretching the definition of relationships – like in real life, where once being monogamous meant ‘one partner for life’, and now it just means not having more than one partner at the same time, long-term relationships with massive tails and huge MGs aren’t as popular as they used to be when it comes to fashion entertainment brands.
Collabs, share-revs, investing time and money in high profile partners for a limited edition or special line… everything flies in order to break through the clutter.
‘OoO Su Cuuuuuute’ – similar to what we’ve gathered from the Vegas show, the increase in Asian influence was evident at BLE 2019: Kakko, Korean Pavilion (Pink Fong, Baby Shark), Rio Visual, Tuba for Lavra, LINE (+BT21), Pusheen, Anime/Crunchy Roll (which shacked up with its new squeeze, Viz).
Sharon Weisman is vp global business development at Licensing International. She can be contacted on email@example.com. She’s also very entertaining on social media, @sharon.weisman.
It’s a world in which high-profile unaffiliated teams carry names such as FaZe Clan, Team Liquid, Cloud9 and Evil Geniuses; where stars with handles such as Ninja, Shroud and DrLupo are, in some cases, better known than the games they play; and where the playing fields are games as varied as Overwatch, League of Legends, NBA 2K, Counter-Strike, and Call of Duty, among many others.
All three of those aspects segments – teams, players and leagues are at the core of an eSports business in which revenue from such areas as sponsorships, media rights, advertising, tickets and merchandise are expected to roar past the $1 billion mark this year, while event attendance and viewership (both online and via broadcast on such outlets as ESPN) also soars.
For companies in the licensing business, however, the road toward leveraging that interest with merchandise is still being built. It’s difficult to get a handle on the current size of the merchandise piece, but research firm Newzoo predicts that global merchandise and ticket sales revenue will increase 22.4% this year to $103.7 million.
Here’s a look at the current state of affairs for the eSports licensing business.
Who is the esports consumer, and how does this fan watch? How many of them are there?
The potential market is sizeable. Global revenues –largely from media rights, advertising and sponsorships – are expected to rise 26% this year to $1.1 billion as the eSports audience jumps 15% to 453.8 million driven by viewership on ESPN, Twitch and other streaming platforms delivered to PCs and mobile devices, Newzoo said. It expects total revenue to reach $1.8 billion by 2022 when the audience – a mix of enthusiasts and occasional viewers – is forecast to be 645 million.
The technology consulting firm Activate projects that by the year after next, eSports will have 84 million U.S. viewers, second only to the National Football League (141 million), and ahead of Major League Baseball (79 million) and the National Basketball Association (63 million). By next year Activate forecasts, 70 million people will be watching a single eSports final. Esports is most popular among the coveted 18-34-year-old consumers, who account for 73% of the viewers and are decidedly male, Activate said.
What’s the licensing play? What’s been done so far?
For the licensing community, there are three basic avenues into the world of esports: leagues, teams and players.
eSports leagues are built around specific games, such as Activision Blizzard’s Call of Duty and Overwatch, Riot Games’ League of Legends, Take-Two Interactive’s NBA 2K, Valve Corp.’s Defense of the Ancients (DOTA-2) and Counter-Strike: Global Offensive (the latter of which is that basis for the Europe-based Electronic Sports League). So, in a sense, if a company has a license for one of those titles, it has an inherent connection to the game.
Many of the leagues have taken on the structure of other professional sports leagues with centralized licensing.
For example, Activision Blizzard designed trademarked logos and handles merchandise licensing for all league franchises in the Overwatch League through a central organization. It signed a deal earlier this year with sports licensing ecommerce and licensing powerhouse Fanatics to supply and market league and team apparel.
Twenty-one of the National Basketball Association’s 30 teams have franchises in the NBA 2K League – a joint venture between the NBA and Take-Two Interactive. Licensing is operated by the existing NBA Properties organization, which developed distinct logos for each of the franchises. Companies with NBA 2K League licenses include NBA licensees such as Champion (team kits) and New Era (caps, t-shirts), while adding videogame-oriented companies such as Scuf Gaming (controllers), Raynor (gaming chairs) and HyperX (headsets).
Licensing of the League of Legends brand is administered by developer Riot Games. In conjunction with its League Championship series, walmart.com in May launched sales of jerseys from 10 teams, taking to Twitter to promote the collection through an LCS Fan Shop, and sounding much like it was promoting the NFL or NBA: “Wear what the pros wear as you cheer them on to victory,” Walmart said.
ESL, which among the oldest eSports leagues, handles licensing of its brand through its Cologne, Germany headquarters, but also is represented by Beanstalk’s Tinderbox division across Europe.
As already noted, licensing related to teams in the NBA 2K League and Overwatch League is handled centrally while there are 10 independent teams in League of Legends North America, 16 in League of Legends Pro League in China (and countless others competing in League of Legends tournaments around the world).The three-year-old ESL Pro League has 48 independent teams.
Those independent teams carry names such as FaZe Clan, Evil Geniuses, Team SoloMid, Team Liquid; they’re not directly affiliated with the leagues, but rather compete in lucrative tournaments around the globe. Most of them have squads to compete across multiple games.
One of the more developed independent teams is FaZe Clan, which has 29 players competing in as many as eight leagues at a time. It’s based in California and expects to have a licensing operation formed by late this year to represent both the team and individual players for merchandise deals.
The teams – whether as franchises in the centralized leagues, or as independents – have drawn investments from other parts of the sports and entertainment worlds. For example, the Pittsburgh Steelers in December invested in the Pittsburgh Knights eSports teams which compete in several tournaments including those for Playerunknown’s Battleground and Electronic Arts’ Madden NFL 20. Dallas Cowboys owner Jerry Jones bought a stake in compLexity Gaming in 2017; the team is based at the GameStop Performance Center, which opened earlier this year at the Cowboys training complex. Owners of franchises in the Overwatch League have connections to such traditional sports teams as the New England Patriots (the Kraft family), New York Mets (Wilpon family), Colorado Avalanche and Los Angeles Rams (Kroenke Sports and Entertainment), among others. And athletes and rappers also have purchased stakes in teams. For example, former NBA star Shaquille O’Neal and baseball star Alex Rodriguez having invested in NRG eSports, which fields independent squads competing across nine games, while rappers Miles “Lil Yachty” McCollum and Kiari Kendrell “Offset” Cephus have stakes in FaZe Clan.
For the most part, player licensing focuses on eSports gamers that aren’t affiliated with a team, but rather have built huge following on social media based on the fame they developed earlier in tournament play.
Among the top unaffiliated players is Tyler “Ninja” Blevins, represented by the talent agency Loaded and licensing agency Brand Central, who has 22.4 million YouTube followers and 14.6 million followers on Twitch (before switching to Microsoft’s Mixer game streaming service earlier this year). Ninja has about a dozen licensing agreements including toys (Wicked Cool Toys) and housewares (Zak Designs).
Loaded also represents Michael “Shroud” Grzesiek, who has 6.9 million followers on Twitch, while the agency ReKtGlobal has about 50 eSports gamer clients, including Benjamin “DrLupo” Lupo, a Fortnite player with 3.4 million followers Twitch.
“We believe the individual streamers have the ability” to translate better to retail than teams as “they have a media platform to appeal directly to fans who get to know them in the same way digital influencers have made an impact at retail,” says Brand Central CEO Ross Misher. “It is difficult for an individual eSports player to get recognized nationally since they are part of a team. Once players leave the teams and become streamers, that’s when their profile and popularity rises” and they become strong candidates for licensing.
An exception among teams may be FaZe Clan, which has positioned some of its players for licensing. For example, the team is positioning its first female member, 13-year-old Soleil “Ewok” Wheeler, who plays Fortnite and has 200,000 followers on Twitch, for women’s apparel, says FaZe Clan President Greg Selkoe.
“Through Twitter, Instagram and other social media, we seed the marketplace by having our players stream and promote their and our stuff in advance of a drop” in seeking to build demand for products,” says Selkoe.
That’s not to say the leagues aren’t preparing players for licensing – Minnesota Timberwolves Gaming point guard and NBA 2K championship series MVP Michael “BearDaBeast” Key is among those players viewed by the NBA as having licensing potential based on his personality and social media following, says an NBA spokesman.
“When you see a player like him [Key] it starts to make sense,” he says. “When you have a charismatic and engaging competitor, we want to align with him just like we would with any other [NBA] athlete.”
One attempt to leverage the influencers’ popularity is by Wicked Cool Toys, which plans to release this month five-inch eSports influencer collectible figures that are packaged with a QR card that “unlocks” a game developed by LAMO for play on a mobile device.
What’s happened so far at retail? What does the future look like?
There’s a relative trickle of eSports-licensed product making its way to retail so far, as licensees and merchants feel their way through a necessary learning process. For example, sales of Champion Athleticwear co-branded with six eSports teams (OpTic Gaming, Counter Logic Gaming, Dignitas, Spacestation Gaming and the Renegades) reportedly fell short of forecast at 75 Footlocker stores during May and June.
“There is definitely an appetite for eSports,” says one Footlocker executive, “but right now it is in its infancy, and we are going to continue to support and grow with it. Maybe what will trigger the business is merchandise tied to a specific event in a given market.” Footlocker sold the apparel through four of its chains – Footlocker, Footaction, Eastbay and Champs — with the latter having the most success with the line.
Adds Matt Waterman, VP-GM of Champion North America: “We see eSports as emerging sport that people are competing in. It is a natural extension our brand since the uniforms are typically t-shirts, hoodies and sweats all of which we produce.
“We are exploring different elements within eSports and it [the eSports licensing program] will become more formalized in the way it is executed. We are very much developing this as we go and as we understand the players and their needs.”
There are other signs that eSports is moving toward the masses. For example, Fanatics — which has licensing agreements with and operates the ecommerce sites for all four major U.S. professional sports leagues, and top global soccer clubs such as Manchester United, Real Madrid, Manchester City (among many other ventures)—billboards “eSports” on its menu bar right alongside those leagues’ logos. Click on “eSports,” and you’re taken to full shops for the Overwatch League and NBA2K League. Its assortment of Overwatch League t-shirts, hoodies, socks and other apparel also is merchandised on Walmart.com and affiliate Jet.com.
Walmart has split the Overwatch apparel with lower-priced goods being sold through its own web site, while more expensive ($59 and up) team replica jerseys, hoodies and jogging pants are sold through Jet.com, which is expected to bring in League of Legends products in November. Jet.com staff also have taken the lead in buying eSports products for both websites, says an executive familiar with Walmart’s plans.
“They [Walmart] see this as a chance to get a jump start in what they think is going to be a growing eSports business moving forward,” says that executive. Walmart didn’t respond to requests for comment.
Sales of goods tied to the NBA 2K League have been built around a sub-site (https://2kleaguestore.nba.com/) of the NBA store online, and at the NBA Store in New York, with shirts from Champion and New Era, and socks from Stance. The NBA also began in-venue sales this year at the league’s eSports arena in Long Island City, NY.
Esports goods have also been popping up in less-obvious places. For example, FaZe Clan sold $1.7 million of co-branded Champion apparel in a 24-hour sale in April on NTWRK – the app-based venture that offers unique merchandise drops via “shoppable shows.” FaZe Clan also had a pop-up shop with player autograph signings and apparel at the shoe store Stadium Goods in Lower Manhattan in late July, drawing throngs of fans already in New York for the Fortnite World Cup. FaZe Clan also is launching co-brand warm-up kits with Manchester United starting with a game on Oct. 6 as part of an agreement with team uniform supplier Puma.
“It isn’t about units and volume, but rather maintaining that edge and doing things that might not work other more traditional leagues that are focused on competitive gaming,” says Selkoe.
There’s also the question of whether eSports merchandising migrates anytime soon to become a staple at brick and mortar, or rather continues to live mostly online. Given that eSports is very much an online endeavor, says Champion’s Waterman “there may not be as much of a brick and mortar play, and it may be mainly an ecommerce business. We are trying to find that natural evolution of where this is going, and we want to be part of it.”
What products are on the market?
While apparel has been the major focus, equipment aligned with playing the games also has proven popular. Controller supplier Scuf Gaming has FaZe Clan and NBA 2K models. Activision Blizzard’s Overwatch League took a page from other professional sports in licensing Upper Deck for player-signed trading cards that are packaged with swatches of game-worn jerseys.
There also have been the more conventional uniform deals.
Nike announced an agreement last month to supply the uniforms for 16 teams in the League of Legends Pro League (LPL) in China, combining the LPL team logo with the Nike Swoosh. And Puma struck an agreement earlier this year to supply Cloud9 uniforms.
The Puma deal allows Cloud9 to “affect broader culture” where “if you want to be able to relate to younger people globally, you had better be thinking about eSports as much as you are thinking about cultural lenses like music and sports,” says Cloud9 Head of Partnerships Jordan Udko.
The footwear company K-Swiss worked with the eSports firm Immortals Gaming Club on “One-Tap” slip-on lightweight sneakers that are designed for those competing in multi-player video games. Then there is AjX Armani, which was among the first fashion brands to enter the eSports business when it signed to provide the Italian eSports team Mkers with uniforms for global tournaments. (They’re not available yet at retail.)
“We are trying to offer fans as many products as possible to help them express their fandom and connect with one another,” says Activision Blizzard eSports Licensing Head Daniel Siegel. “We know that fans respond strongly to any product that our players wear or use on stage.”
Like Activision, the NBA 2K League has focused on building out its team and league brands by drawing from the NBA’s roster of licensees (such as Champion, Stance and New Era), while adding gaming-specific newcomers such as Scuf Gaming (controllers), Raynor (gaming chair) and HyperX (headsets).
“Everything we have done with NBA, WNBA and G-League is serving as a template for eSports in terms of licensing,” the NBA spokesman said. “If you look at the NBA2K League, we have an advantage — the NBA knows how to build a business around the teams and league and has a record of building a local fan base, creating compelling content and selling merchandise and sponsorships.”
The focus thus far most leagues and teams has been on premium priced merchandise. For example’s Scuf’s Vantage NBA 2K controllers sell for $225. And a home textiles company that is developing League of Legends backpacks for the U.S., is redesigning a base model that typically sells for $10 with more room for storage and better materials and is pricing it at $49. And Faze Clan youth hoodies typically retail for $60.
“Consumers will spend on high-quality and features because the products are an extension of their fandom,” says Daniel Amos, of lifestyle apparel supplier Difuzed, whose company is developing a co-branded apparel line for ESL due in spring 2020. “For [eSports] apparel it is a different cut and sew technology; it’s not necessarily a blank t-shirt where you put a logo on it and you have made money. It needs to be more than that.”
In some cases, licensees say, indy teams such as FaZe Clan 100 Thieves are positioning themselves as lifestyle brands and, along with the social media influencers, have even greater potential than most for licensing.
“I am not sure the future is team and eSports merchandise in the same way we think about traditional leagues,” says Aaron Levant, CEO of ecommerce and content platform NTWRK. “It is more of the culture of gaming, where the real fandom is, and where the real merchandise dollars are going to be in this space. The leagues don’t yet have the generations of people that have grown up around eSports, and have an affinity for it in the same they do with other professional leagues.”
And leagues concede that many companies are still early in their understanding of eSports and how licensing plays into it.
“There is a little bit of education that comes into play and when we are looking at brands, and we’re qualifying them, it does go back to: do these brands want to just look at our audience as a transaction?” Riot Games executive Matthew Archambault told Game Haus. “If that is the case, it’s probably not the best suited for us as a brand.”
Activate, Michael Wolf, CEO, 212-326-4444
Activision Blizzard Entertainment, Daniel Siegel, Head of eSports Licensing, 949-955-1380 x64507, firstname.lastname@example.org
Licensing International, the leading trade organization for the global licensing industry, will establish a new office in the Nordics in cooperation with the Association of Agents and Managers in Creative Industries of Finland (AGMA), a professional association supporting the creative industries in Finland and the Nordics. The new Licensing International Nordics joins Licensing International’s network of global offices, which also includes locations in the UK, Germany, Australia, France, China, Japan, India, Russia, Brazil and Italy, in addition to the head office in New York City.
Licensing International Nordics will serve eight countries – Denmark, Finland, Sweden, Norway, Iceland, Estonia, Lithuania and Latvia. Combined, these countries accounted for nearly $4.8 billion in retail sales of licensed merchandise in 2018, according to Licensing International’s annual industry survey*, making the region a significant player in the global brand licensing marketplace.
Licensing International Nordics will be headed by Kati Uusi-Rauva, AGMA Director, and Heikki Laaninen, AGMA chairman and Head of Licensing at boutique licensing and publishing agency Ferly Co. Under the Licensing International banner, Uusi-Rauva and Laaninen will work with other local executives to develop events, educational programs, business outreach, networking opportunities and localized news and resources for the benefit of licensing professionals in the Nordics region.
“I’m thrilled to bring the benefits of Licensing International membership, alongside our network of resources and influence, to industry executives throughout these key countries in the Nordics,” says Maura Regan, President, Licensing International. “This region is home to a vibrant creative and professional community that has given rise to powerhouse brands and products, so I’m pleased to offer executives in these countries the resources to further grow their business and expand their connections within the global licensing industry.”
“We have seen a rise of interest in brand licensing possibilities in the Nordics during the last few years,” says AGMA’s director Kati Uusi-Rauva. “This has happened especially in the entertainment, content and design industries. Therefore, we are really happy to develop further the Nordic brand licensing community and make it more visible and accessible to the global networks through cooperation with Licensing International.”
*Click here to download your copy of the Licensing International Annual Global Licensing Industry Survey, which is free for all Licensing International members.
About Licensing International:
Licensing International – formerly known as LIMA – is the leading trade organization for the global licensing industry. Licensing International’s mission is to foster the growth and expansion of licensing around the world, raise the level of professionalism for licensing practitioners, and create greater awareness of the benefits of licensing to the business community at large. Founded in 1985, Licensing International members in over 40 countries enjoy access to an array of benefits, including extensive educational programming and worldwide networking events. Visit LicensingInternational.org for more information and to utilize licensing’s definitive online resource.
AGMA, the Association of Agents and Managers in Creative Industries of Finland, represents agencies and managers working in all creative industries such as design and graphics, publishing, photography, performing arts, music, games and media. AGMA organizes events and training, acts as a spokesman of its members and actively takes part in the creative industry business development on a national and international level. Learn more at AGMA.fi.