From Hype to Hope - movie licensing analysis - Brief Article - Column

When we last looked, studio licensing folks matched their pr departments in grand promises made. Though the failure to deliver on these predictions rarely stopped in-house licensing reps from making equally pie-in-the-sky guesstimates on retail sales for the studio's next project, licensing folks were always ready with a brazen explanation and no apology while collecting the minimum royalty guarantees due, along with advance payments on the next sure thing.

Call it the "Star Wars Effect," or the "It's Not Lion King Syndrome," or even the "Don't Give Me that Brand Baloney," but we've suddenly seen a screeching halt to Hollywood hype, at least as far as the licensing legions go. Is Hollywood changing its ways?

More likely, the nation's leading retailers, the Wal-Marts, Kmarts, Tar gets and the like--all happy to help push properties on kids and their families--got tired of getting burned with excess inventory when the Next New Thing turned out, again and again, to be the Same Old Thing.

When the new Star Wars, with all of its real successes, failed to live up to its hype, retailers who bought into it in unprecedented volumes began to wonder if it was time to get off the train. Ditto when the Disney merchandising magic so evident with The Little Mermaid, Beauty and the Beast and especially The Lion King, became so much fairy dust with Pocphontas, Hunchback and everything since. Retailers realized: entertainment properties don't come wit guarantees at retail even if they come from the best studios in town.

Now we enter the (probably brief) Era of Anti-Hype, and, with all of the lowered expectations, I admit growing nostalgic for promises only someone delusional (or willingly self-deluding) could believe. Take, by way of example, the licensing for Shrek (from Dreamworks) and for Harry Potter (from Warner Bros.).

Shrek licensing, handled by the incredibly creative, ordinarily "Take No Prisoners" Brad Globe, has been a model of the low-key patient approach. It has been lightly licensed, and there's no possibility that anyone could say that Shrek (Yiddish for "scary") had gone schlock. Has Brad Globe lost his edge? Hardly. The licensees and retailers weren't lining up for what turned out to be a hugely amusing delight, and world-beater Globe used jujitsu to turn a weakness into a strength by seeming to say: "Wait for the (already announced) sequel or the next Dreamworks megapic! Shrek will teach you to ignore our predictions!"

Harry Potter licensing, on the other hand, didn't just get hammered by the spillover Star Wars Effect. It is also a victim of a self-inflicted wound.

If any movie property should have retailers bouncing off walls, Potter should. Everything is going for it. Each of the books has achieved massive bestseller status, with a cult-like following and huge anticipation for its Thanksgiving release. And, Warner Bros. is part of a great marketing machine (with AOL, CNN, the WB network and the likes of Time, People and In Style) all promoting it non-stop from back-to-school until the film's debut. The Warner Bros. licensing team, headed by the visionary Dan Romanelli, is probably the best in the entertainment licensing business today Yet, retailers are avoiding Potter licensed products as if a wart-covered witch was offering them for sale.

Rather than wait for the days before the movie's release to begin selling movie-inspired licensed merchandise to pre- and just-literate little kids, products based solely on the books were released last year in relatively small quantities. The age and personalities of the readers and the gizmos offered proved to be largely a mismatch, and the items were offered for close-out before you could say "Quidditch." From that, retailers learned-incorrectly--that Harry Potter won't pull through merchandise. More likely literary licensing has always been a small and upscale affair.

Romanelli would be justified in shaking retailers until they saw the magic in Potter, but he's taking the low-key, long-term approach telling licensees and retailers that there will soon be a second Potter film, and there is plenty of time to tap into this enchanted property. Although the slow sell must feel like an evil spell, it gives all Hollywood--and especially Warner Bros.--a chance to lure retailers and all would-be licensees back into the game after the current wave of reduced promises yields to the familiar world of Great Expectations.

Seth M. Siegel is co-chairman of licensing agency The Beanstalk Group in New York, whose clients include Ford Motor. AT&T, Harley-Davidson and Mary-Kate and Ashley.

COPYRIGHT 2001 BPI Communications, Inc.
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