The force is with licensing rights

Kids love film characters – from Luke Skywalker to Boobah. But how crucial is it to have the right name on your product? And what are the next licences set to drive kids wild? Su Clark reports

Come May next year, Star Wars will be everywhere. From sweets to computer games, from T-shirts to bags, the Empire and the Rebellion will be with us.

Negotiations may stall between the protagonists on the big screen, but here on Earth, those who hold the licence for the film and the companies desperate to exploit its popularity have been talking for some time.

It’s the last in the double trilogy, but the merchandising business Star Wars spawned (which has made more money than the films) is entrenched in our culture.

Licensing is now a massive business on a global scale.

Movie makers, television companies, book publishers and comics all fiercely protect the characters they’ve created so they can sell use of them to companies keen to establish kudos with consumers.

“A licence provides legal access to the intellectual property or content of a producer,” explains Andrew Kerr, senior vice-president, global licensing and marketing at Ragdoll.

“In commercial terms, licensees believe that particular content will make their products a more attractive purchase for children and their parents.”

Even before a film is released, the characters are out there. Fast-food restaurants are particularly fond of them, as are cereal companies and even washing powder producers.

“Companies that produce fast-moving consumer goods are keen on characters for promotion,” says Simon Philips, managing director of 4kids, a licensing agent for Pokémon, Yu Gi Oh, Ninja Turtles and, more recently, RAF.

“They work for products that are frequent purchases and which have difficulty building loyalty. But the potential to use them for other products is huge.”

But to grab the “it” character of the moment takes cunning, know-how and a lot of luck, as licences are sold long before the character hits the screen.

It helps that the licensors are a proactive bunch, peddling their characters well in advance of their moment of glory, but the potential licensee has to recognise what will be big and what won’t.

“There isn’t anything that you can look for – it is often just down to luck,” says Philips.

“Kids have got to like them. If they don’t, then it won’t work.”

It is also crucial to recognise the longevity of a character. Most film characters are on box in the run-up to release and are off by the time the film bows out at the cinema. Evergreen characters, such as Ragdoll’s Rosie and Jim or the beloved Teletubbies , have a longer build-up but can have a longer grip on children and parents.

Recruiting the likes of The Incredibles to beat the competition is expensive, with the cost as varied as the properties.

A rights fee is charged by the licence holder for using the character for a certain time, as well as a royalty on any items produce such as toys given away in a Happy Meal.

During the life of the licence, the licensor retains control over the character, right down to the colours used and the positioning on the package. The client must also commit to an agreed level of media spend. For the license holder this is as important as the fee.

“It can cost a lot of money to purchase a licence, but not always,” says Lisa Shapiro, managing director of the entertainment division of The Licensing Company, which is the agent for Star Wars, as well as Lord of the Rings, Bratz, Purple Ronnie and the forthcoming Magic Roundabout film. “It’s a two-way street. The owner of the title gets a lot out of promotional partners as it helps build the brand profile.”

Some licences can be bought up quite cheap because of this, although we suspect not Star Wars. For Lucas films, it is the income from the licence for his galactic empire, rather than the film, which is bringing in the billions.

But having supermarket shelves filled with Star Wars images also helps reinforce the message that The Revenge of the Sith will soon be upon us and in cinemas soon

What’s around the corner?

Expect to see giraffes and penguins from the up-and-coming Madagascar and cute robots from the Robin Williams voice-powered Robots next year.

Sport will be popular due to the Olympic bid and the World Cup. Winx, a new fashion doll, is also tipped as a biggy for 2005.

“The girl proposition is the new phenomenon,” says Philips.

“Licensing used to be geared to boys and under-fives, with just Barbie and Winnie the Pooh for the girls. But that’s changing and we’re going to see more girl oriented merchandising out there.”

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