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‘Star Wars’ & Films Drove 4.4% Licensed Merchandise Sales Bump In 2016

Deadline logo Deadline 5/22/2017 David Lieberman
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Star Wars and other entertainment properties helped to lift global spending on licensed merchandise by 4.4%, to $262.9 billion, in 2016, according to an annual tally released today.

The International Licensing Industry Merchandisers’ Association (known as LIMA) released its “Annual Global Licensing Industry Survey” to coincide with the Licensing Expo confab taking place this week in Las Vegas.

The U.S. and Canada accounted for 57.9% of global retail sales, up from 57.7%.

The average royalty rate dropped from 8.5% to 8.2%, the survey shows. That limited global royalty revenue, at $14.1 billion, to just a 1.3% increase.

Entertainment/Character-related toys, clothing and other merchandise still dominate the industry, the numbers show. They accounted for $118.3 billion of retail sales, 45% of the total, up from $113 million in 2015.

“The big movie properties were Star Wars, Trolls, Finding Dory, and Batman v. Superman,” said LIMA SVP Marty Brochstein. “And outside of theatricals, Pokémon — inspired by Pokémon Go — saw a surge.”

Star Wars helped because in 2015 “it was a second half [of the year] phenomenon” as fans waited for Star Wars: The Force Awakens — the first addition to the saga in a decade, which was released that year in December — he added.

Once the merchandise was back on the shelves, “in 2016 you had a full year” of sales.

Retailers continue to be optimistic about 2017 — in part due to Hollywood’s growing dependence on established franchises and efforts to fill blockbusters with powerful women.

While Rey from The Force Awakens stands out, “we are seeing this way beyond Star Wars with Wonder Woman, DC Super Hero Girls, innovative preschool television programs and much more,” Brochstein said.

Disney already has announced that it will gin up excitement for goods tied to December’s Star Wars: The Last Jedi by holding them back until a Force Friday unveiling event in September.

Toy maker Hasbro will take a page from that playbook shortly afterward by holding its first Hascon convention to showcase goods tied to Transformers, My Little Pony, and G.I. Joe, among other properties.

Comcast’s Universal Studios is adding resources to its merchandising efforts following its acquisition of DreamWorks Animation.

E-commerce also helps. It now accounts for about 28% of sales, and “you’re not constrained by the capacity of physical store shelves,” Brochstein said. “You can garner sales out of older properties and things that may have more limited appeal.”

But studios and their partners probably will spend much of this week trying to figure out how they should respond to the growing number of fans who want to make –and sell — entertainment-related art and merchandise.

“Everybody’s trying to walk that tightrope between controlling your [intellectual property] and ensuring that everything fits and works and is of quality, while not stepping on the the enthusiasm of those who are the biggest fans of your franchise,” Brochstein said.

Another concern: the possibility that the Trump administration — led by a prominent licencor for branded merchandise — will tax imports of consumer products.

Outside of entertainment, Corporate/Brand Trademarks accounted for $54.6 billion in last year’s global retail licensed merchandise sales. They were followed by Fashion ($31.1 billion) and Sports ($25.3 billion).

Apparel accounted for 14.9% of total global licensed merchandise retail sales. Toys generated 13.3% with Fashion Accessories next at 11.3%, and Video Games/Software/Apps at 6.9% of revenue.

The fastest growing category? Infant & Pet Products.

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