The growing penchant towards owning a bit of the entertainment content has for sure fuelled the brand licensing and merchandising industry in India thus making it reach the worth of more than $700 billion. Of the total market, a major pie (approx. 80 per cent) is dominated by character licensing and the entertainment content. This is where the sweet spot lies for both licensees and licensors.
Given the stature of character licensing, a plethora of manufacturers and retailers flocked around to become licensees for popular characters across categories and thus created a mark in the industry. For instance, one of the many identities of HM international is the biggest licensee for Back-to-school category and Bioworld is globally known as one of the biggest licensees for T-shirts. But what was common was the fact that most of these licensees were some new brands that were using brand licensing as a strategy to make their presence felt in the retail eco-system. Initially established brands dealt only in corporate licensing, for instance Arvind Group got brands like Aeropostale and Louis Philippe to the country and Reliance paved way for brands like Kate Spade New York.
What made ‘brands’ foray into licensing?
More than 60 per cent of the population in India is under the age of 35 where about 50 per cent is below the age of 25. The demand of brand conscious consumers, especially the young, has inarguably accelerated the growth signal for the business of brand licensing in India. Given the evolving aspirational needs of the super-consumer who are brand conscious and exposed to global content, the brand licensing market in India underwent a change with premium brand taking proportionate steps to tap this group of consumers and be their one stop shopping destination. And brand licensing served as an effective retail strategy.
Such a strategy not only allows the brand to keep the existing consumers glued to it, but also helps it woo all new set of consumers in an efficient manner. Of late, ayurvedic products brand Biotique has inked pact with Disney to launch Disney characters inspired products for kids. Talking about brand’s focus to develop the best products with natural Ayurvedic ingredients, Vinita Jain, Chairperson & Managing Director, Biotique said, “Our aim is to bring together the best of both brands -- Biotique’s expertise in the skin & hair care segment and the emotional connect kids and families share with Disney, through their great stories, wonderful characters and engaging products.” Taking similar initiatives, Bestseller has launched two capsule collections with Disney (Star Wars and Captain America) for Jack & Jones. “With JACK & JONES, we continue to offer products which align with the varied interests of our customers. Limited edition capsule collections have worked excellently for JACK & JONES and we hope to replicate the same success with the CIVIL WAR collection,” asserted Vineet Gautam, Country Head, Bestseller India.
How are brands benefitting?
The catch here is that the established brands are launching limited edition capsule collection under licensing strategies, instead of going for full-fledged collection. This not only gives brands an edge in the market by monetizing the power of licensed property/character, it also benefits them in the sense that a proper media launch is optional in case of capsule collection. Voicing the same, Chitra Johri, VP, Bradford License India said, “Such practices let the retailers offer the best of both worlds. They not only reach to a wider consumer base through such capsule collections, but also the licensed collection is presented as a small part of the entire collection rather than it dominating the entire range.”
The way forward As India moves towards welcoming newer global properties, the standard of licensing business is bound to rise; credits to the involvement of established brands in L&M industry that will not only offer consumers more options, but also organize the industry which is dealing with issues as counterfeit and parallel market.