Successful promotional licensing begins with the right choice of a partner, whether that’s a peppery affair with the Spice Girls or a swinging night on the town with Austin Powers. Brand and property need to match like Brooke Shields and her Calvins, not like some CatDog hybrid.
Yet finding the perfect property is only half the challenge for product and services marketers searching for that one-plus-one-equals-five potential that makes licensing so irresistible. Marketers should be prepared to explore all possible avenues to make that borrowed interest sizzle not only for the brand but for the licensor, the retailer, and the consumer.
For instance, a movie or TV studio’s consumer products unit will avidly coordinate projects among its various internal divisions to give a marketer’s product tie-ins maximum spin. “That means the marketer has a broader palette of colors to paint from,” says Mark Mears, ceo of Dallas-based Tic Toc.
Brands lacking a strong identity may rely on the borrowed interest of a license for excitement value, as Minneapolis-based Cost Cutters Family Hair Care Salons did in back-to-back tie-ins with Turner Entertainment’s Scooby Doo and a string of Saban Entertainment/ Fox Kids’ shows.
But promotional licensing tie-ins can serve strategic ends even for the strongest brands, such as when Mott’s borrowed characters from Nickelodeon for its applesauce and juice brands, or when SmithKline Beecham’s Aquafresh toothpaste and toothbrushes teamed with Disney’s Tarzan to redirect its messages from parents to kids.
By bringing retailers something they couldn’t do on their own, manufacturers gain an edge in stores, too. Joining with Turner’s Cartoon Network to reach tweens, Pepperidge Farm features on-pack cutouts of TV characters such as Powerpuff Girls and Cow and Chicken on five Flavor Blasted Goldfish SKUs through June. The goal is continuity to erase spotty shelf distribution, says Pepperidge Farm assistant brand manager Sarah Bernstein.
Licenses may be short-term, tied around a single season or event. Nabisco will dip back into Universal Studio’s Classic Monsters archives this Halloween to decorate packages of Oreos, Chip’s Ahoy, and Ritz Crackers. Licenses can also become something that looks permanent, like Post’s Flintstones-inspired Pebbles cereals.
Whether it’s as ephemeral as a six-week sweeps or becomes etched in flakes for posterity, licensing is thriving as industry segments from cellular phones to dating services enter the arena, and entertainment companies vie to turn simple properties into franchise juggernauts.
Here are some tips for optimal licensing:
FIND THE RIGHT PARTNER: A licensed property needs to match the characteristics of the brand or the brand’s audience. Marketers can research a property’s appeal by attending licensing shows, or following Nielsen and Q-ratings to tap the preferences of kids and adults. Some promo agencies have close alliances with entertainment firms that keep them current on studios’ plans and release dates.
Learning the dynamics of different media can help winnow the list of potential partners. Movie studios, for instance, typically work a year out from a film’s release date, which leaves enough time for planning strong promotions.
Tying into a video release is often more advantageous, because the film’s success has already been measured, and because it makes account-specific retail overlays possible. But release dates are not established as far in advance. “Video divisions often don’t know what their schedule is six months out,” notes Van Nuys, CA-based entertainment consultant Barbara Watts.
TEST IT OUT: With long-running entertainment franchises like TV shows, marketers have a chance to test a character’s appeal with audiences in shorter-term commitments. Before it licensed the Blue’s Clues and Rugrats characters for permanent use on applesauce SKUs this year, Mott’s borrowed the properties for some in-and-out efforts to prove that the 98-percent kid recognition of the Nick shows would translates into grocery sales.
MASSAGE THE RELATIONSHIP: Be firm on your objectives, but flexible with tactics. Let both sides explore alternatives to develop the best solution in a creative, fluid process. Studios that five years ago had one-man consumer products divisions today have 25 staffers – all eager to explore possibilities. “Everybody [on both sides] wants to work it harder,” says Watts.
SET THE FEE: Licensing fees vary depending on the studio, the property’s strength, and the parameters of the promotion. Long-term deals typically involve a figure based on the number of units expected to be sold or a royalty arrangement. Studios often waive fees in return for broadcast advertising. “Some studios are very flexible on fees. In return, they want exposure for their property,” notes McCracken Brooks vp-entertainment marketing Gretchen Parker. By promising corporate advertising on Cartoon Network, Pepperidge Farm got its fee waived and received free promotional spots for the campaign to boot.
PREPARE THE PITCH: Studios want quality and exposure. They’re looking for “killer app” ideas, not just tonnage.
You don’t have to be a huge player if you bring in a resonant idea. “The studios look at it almost like building a stock portfolio. They want an anchor, and other partners to broaden the promotion,” says Mears.
Tying in with Columbia TriStar’s Men in Black two years ago, Bausch & Lomb’s Ray-Ban lacked funds for major media advertising. Yet it was a natural product to tie into a film featuring shades-wearing lead characters, and it brought the film exposure through in-store ads at 15,000 retailers, including many located in malls with theaters.
You have to be creative if you can’t afford the TV spots that studios typically seek. Suggest ideas for working with other divisions or cross-promotions, or offer to commit to account-specific programs.
MAKE IT SING: Put together a fully integrated campaign, with broadcast media included whenever possible. Triarc Beverage’s RC Cola put the riding mower in third gear for a licensing tie-in with Fox’s animated King of the Hill. RC’s American Dream Sweepstakes features original TV spots running on Fox and ESPN, radio and print, a trade contest, and character images on 12-packs and two-liter bottles. Consumers win instant prizes such as lawn mowers and propane grills that play on the show’s Middle America theme. A watch-and-win overlay offers $100,000 to make an American Dream purchase. “It’s a wide-reaching promotion allowing two All-American brands to work together on a national level,” says Sabrina Ironside, Fox Licensing and Merchandising executive director of worldwide TV promotions.
With Blue’s Clues, Mott’s put paw prints on bottles and characters on labels of every sauce and juice SKU possible, offered a plush premium, and added media support. The brand even tossed in some product innovation with blue applesauce and, later, three Rugrats-inspired flavors.
“They definitely went beyond what we expected them to do,” says Nickelodeon vp-promotions marketing Pam Kaufman.
Sports-minded sponsors and licensees similarly confront a field in which properties have a sophisticated sense of what can be accomplished and what results can be gained.
“The sports leagues want to grow their business. It’s not about taking rights fees anymore,” says Steve McKelvey of PSP Sports, New York City. “You have to support your license to help the league meet its objectives, build the fan base, [and] build positive imagery.”
PSP partnered real estate chain Century 21 with Major League Baseball to use team logos and action footage in activities including two national sweepstakes and Turn Ahead the ClockNights, in which teams will play games as they might be played 50 years hence.
LOOK AROUND THE LOT: The consumer products divisions of film and TV studios function like the hub of a wheel, working with various divisions to expand promotions.
“We want to explore as many avenues as we can with all the divisions that have anything to do with King of the Hill,” says Ironside. In plotting RC’s tie-in, Ironside learned that Fox’s publicity division planned a Big Holiday Comedy Festival King of the Hill Day at a U.S. Lawn Mower Racing Association bash in Austin, TX. The consumer division got RC Cola to sponsor a barbecue at the event.
Marketers should consider how they might work with the division’s retail groups, which are there to grease the skids for promos with retailers. A joint visit by the brand with the studio commands more attention from the chain.
TAP THE TALENT: Studios are usually willing to make their marketers – or even their actors and directors – available to talk to the sales force or the trade. Cost Cutters enlisted comedian Louie Anderson to autograph some of the premiums in its Fox tie-in, which included his show Life with Louie. The haircutting chain gained the rights for 10 appearances by costumed characters, turning them into long weekends where salons staged cut-a-thon events, says McCracken Brooks’s Parker.
Studios might also provide preview screenings or passes that can be used with the trade or consumers, Parker adds.
CORNER THE MARKET: Get category exclusivity. A popular character isn’t going to enhance your image if the competition is sporting the same face.
PLAN AHEAD: Get the rights you need up-front to avoid potential costly negotiations with actors or unions later, Parker advises. A possible rights checklist might include footage, radio voiceovers, cast photos, and the one-sheet.
REQUEST CROSS-PROMOTIONS: Licensors should be willing to facilitate cross-promotions with other licensees, which can be powerful vehicles for expanding your promo’s reach or simply making it better.
When Pepsi licensed The Simpsons for its Flavors brand two years ago, Fox’s consumer products unit found a partner in its own interactive division. Planning to release a virtual CD-ROM based on the show, the online division had tapped Los Angeles house builder Kaufman & Broad to erect a life-sized replica of the Simpson homestead in Las Vegas. “We made Kaufman & Broad a licensee and gave the house away as a grand prize in a watch-and-win Pepsi promotion,” says Ironside.
CONSIDER PREMIUMS: A premium offered with a promotion isn’t all that different from licensed merchandise sold at retail, and licensors love them for the same reasons – they generate royalties and produce enduring physical exposure.
TRADE UP: Licenses are a great way to capture consumers’ attention on the shelf, but also to turn the heads of retailers who know what shoppers like. Marketers can use properties as dealer loaders – say, an autographed one-sheet – and as springboards for account-specific programs that make it look like the retailer is bringing the property to customers.
Licenses needn’t arise only from entertainment properties. Marketers can license another popular brand’s trademark, such as when Burger King featured M&M dispensers as premiums in its kids’ meals. Denny’s has a deal with Zoob toys, which was looking for grassroots-level exposure through the food chain’s 1,700 outlets. Zoob will sample its construction toys at the restaurants this summer and offer a 17-piece set in a $3.99 self-liquidating offer.
It’s always good to have a backup plan if you’re licensing a theatrical release. Dairy Queen’s hopes for a summer promotion melted several years ago when Columbia bumped the opening for the film Radio Flyer to the fall.
“Studios need you as a partner. But more importantly, the movie has to be successful, [so] they will jockey for the right window as the release date nears,” notes Watts.
The first rule of licensing: Use it. It might require opening the wallet. But you’ll get the most out of the deal if you are prepared to stretch your strategic and creative skills to the limit.
They Know Jack San Diego-based Foodmaker Inc.’s Jack-in-the-Box expects a hit with its latest promotion, a self-liquidating PEZ Candy dispenser featuring the chain’s clown-faced personification (see below). How do they know? Because the $1.99 product has been selling for hundreds of bucks on the PEZ “black market.”
Although the promo wasn’t set to break until June 1, unscrupulous PEZ dealers got their hands on a few cases of product more than six months ago, soon after they were manufactured in a Hungarian PEZ factory, explains Michael McNeil, national accounts manager at Niles, IL-based supplier Ha-Lo Industries. “It’s the first time PEZ has custom-molded a dispenser that won’t be sold at retail, so collectors went crazy.”
Unaware of the PEZ collector craze, Foodmaker ordered a typical 2.2 million units for its summer promotion, but now expects to sell out in less than two weeks, says McNeil. PEZ’s lengthy lead times made it impossible to manufacture more in time for the launch. “But we can go back in July and get a re-order for Christmas if we need to,” he says.
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