Live from the Licensing Show: Licensing Royalties Rise by 1.5%

Royalties from U.S. licensing categories hit $6.04 billion in 2006, a 1.5% increase from 2005, a recent study by the Licensing Industry Merchandisers Association found.

“The results of the study confirm that our industry continues to grow, even in this challenging business environment,” said LIMA president Charles Riotto. “Every year we see a new influx of companies building licensing programs around their characters and trademarks and reaping the brand building and revenue-generating benefits.”

There were no surprises regarding the category leads. Entertainment and character licensing held the top spot once again with $2.62 billion in royalty revenue, a 2% increase or $54 million. That accounts for 44% of the licensing market.

According to the study, trademarks/brands made up 18% of the market, but stayed flat. The segment rose less than a half percent by $4 million to $1.09 billion. Sports, however grew to $825 million, a $15 million increase or nearly 2%.

While it is the smallest category, music saw a 3% increase, up $4 million to $128 million. Meanwhile, fashion grew by $8 million, or 1% to $830 million.

The study was commissioned by LIMA and conducted by researchers at the Yale School of Management and the Harvard Business School. This is the ninth year LIMA oversaw the study.