Royalty Revenues Down 5.6% Per 2008 Licensing Survey

According to the latest annual survey from the International Licensing Industry Merchandisers’ Association (LIMA), brand owners collected $5.7 billion in licensing royalty revenue in 2008—5.6 percent less than they collected in the previous year. The report showed royalty revenue collected by brand owners declined in eight of the nine categories of licenses tracked. The collegiate market proved the only exception, with schools and affiliated organizations collecting 3.5 percent more last year for a total $208 million.

“Given the current economic climate, the revenue declines are not unexpected,”said Charles Riotto, LIMA president. “However, a strategic, thoughtfully implemented licensing program remains a very effective way for businesses to build their brands, drive incremental revenue and position themselves to thrive in a rebounding economy.”

The character segment continues to generate the largest portion of royalty revenues, at 46 percent or $2.6 billion. Other major segments include corporate trademarks/brands (17 percent), fashion (14 percent) and sports (13 percent).

Survey responses indicated retail distribution patterns for licensed merchandise may be changing, as licensors exploring new retail opportunities. Mass merchandisers remain important, but several brand owners said they are seeking relationships with smaller, independent retailers, who may be able to respond more quickly to hot market trends and more willing to take on new, untested properties and products. Non-traditional retail spots, such as supermarkets, drug stores, specialty chains, online retailers, dollar stores and warehouse clubs also appear to be growing in importance to brand owners and their licensees. For further details, visit www.licensing.org.

In This Issue: Preschool properties that translate into consumer products success Retailers reveal the power of accessories The sports licensing report Plus: Character-based apparel Coming Next Month: Keepsake gifts that appeal to contemporary and traditional consumers Communion wear trends Recession-busting tips from veteran retailers Plus: Versatile special occasion wear