Is Indian Cinema waking up to the power of brand licensing?

Brand licensing in India began roughly around 10 years ago with establishment of organized retail sector as an aftermath to the economic reform of 1991. Started primarily with character licensing, the industry graduated to adopting Indian cinema as a platform for brand licensing.  And this was well resonated by retailers and consumers. And the big success story of cinema licensing began with DDLJ – the blockbuster from the satchel of Yash Raj Films.

Realizing the immense potential the licensing industry possess, YRF even went ahead to establish its in-house licensing division to license the company’s assets including movies such as Ra.One and the Dhoom franchise. However, merchandise was seen as a mere marketing tool by the producers.

While licensing was ancillary thing to them, prime focus was to increase visibility of the movie. Given the amount of consumption of Bollywood in India, where almost 1,000 films are produced annually (about double Hollywood's output), merchandise has not been able to make a mark in that huge manner as in case of Hollywood movies.

The home-grown content Disney India on-boarded as much as 50 licenses for its most awaited movie Star Wars, while 16 deals were done for Finding Dory which is the highest number of deals for any animated movie in India.

However, when one compares it to Indian cinema, the scenario seemed to be pretty tense with just a mobile game being launched in the name of licensing. Cut to present, when Indian cinema has awaken to the power of licensing and latest in the league is Baahubali franchise that literally smashed most of the box office records. Going further, the producers (Arka Mediawork) are devising entire licensing strategy for the movie and are hoping to make it the first Indian tentpole franchise.

Voicing the same, Shobu Yarlagadda, the CEO of Arka Mediaworks said, “Prior to the release of Baahubali: The beginning, we were very clear that we are not going to do just anything for the sake of marketing. The basic idea behind licensing was to better engage with the fan base. We believe that the world of Baahubali is immense with a lot of depth and scope.” Of late a number of producers have extended their movies through licensing in categories such as fan merchandise, gifts and novelties.

For instance, Balaji Production inked pact for The Flying Jatt, YRFL has a deal with Timex for Sultan. Chitra S. Johri, Director, Bradford License India said, “Bollywood has come of an age when licensing was a mere promotional strategy and now things are changing rapidly, which is evident in growing number of licensing deals in entertainment genre. It is evident that presently for any big commercial project licensing is planned alongside.

However, we are yet to see majority of projects to integrate this as an integral strategy for enhanced visibility and additional revenue stream. “Most producers do look at merchandise as a marketing tool. But given the amount of revenue Baahubali has earned at the box office, Arka Mediawork do not need the support of merchandise to market the brand because the film has a huge marketing budget of their own,” responded Bhavik Vora, Founder & CEO, Black White Orange while emphasizing that licensing has grown into a serious business more than a marketing strategy.

A win-win situation Credits to licensing, the fraternity has witnessed many new entrants in the arena who are actually building their brand on the back of licensed merchandise. “With silver screen churning out some really good cinema that has the potential to go beyond just being an entertaining few hours, it’s a good time in India for licensed movie merchandise. As a brand, it helps us to delight consumers with stuff with which they already have a connection established and also gets us to be the first few movers in the growing licensed merchandise space that is still at a very nascent stage in India,” asserted Anamika Joshi, Co-founder, Utpatang.com. Such licensing also addresses the issue of visibility and discoverability for the licensees. In words of Anila Andrade, AVP – Operations at 99Games, “Creating a game out of a licensed brand, for instance Dhoom in our case, solves the problem of discoverability. The consumers are familiar with the franchise, given the movies released in past. The brand name gives credibility and visibility to the game which in turn drives the number of downloads.

The puzzle of liking vs. buying No doubts about Indian cinema being the most prolific cinema factory in the world, but the major challenge is getting consumers to graduate from liking the licensed merchandise and actually buy it. “I believe if you give the fans something that is worth and as well as the brand is infused into that, it would really help bridge the gap between liking and buying,” adds Shobu Yarlagadda. Brand owners should look at brand licensing as a serious business because it not just adds to their revenue but also adds up to the legacy as a movie. Characters Harry Potter and Batman have lived among the fans through merchandise even when the movies are not there or have long gone. Adopting right licensing procedures and devising a program in its totality is where we have to reach, which also hopefully is approaching in times to come!”