Miles to go

Retailer: Considering the lesser awareness of licensing amongst the small and mid-sized manufacturers, what is your initiative to popularise licensing concept?

Gaurav Brar (GB): The manufacturers that we work with here are mostly proprietors. They don’t have the scale and expertise like those in the developed countries. But these manufacturers here are good enough, in terms of not only manufacturing capability but also for their professionalism as a business entity. There’s a sea change in a sense that they have started realising that what business opportunity this could be. And since then lots of changes have happened. The awareness among the manufacturers mainly met through the licensing events, which is in a sense a confluence of licensors and licensees, where they meet and share their business thoughts, and that’s how the awareness is generated. The licensing industry in India is presently growing at 20-25% and has the prospect of a growth rate of high double digit numbers.

Retailer: What are the metrics you follow to select a licensee?  Do you have any plan to expand to adult categories?

GB: We evaluate the business house through its track record, how they are being doing, how they are being performing, what are the business lines they are being currently, we look at the growth opportunity and how ‘s the company willing to exploit the growth opportunity. It’s essential to understand the integrity and professionalism of the business partner that we want to work with. It’s largely a combination of how they are willing to exploit the growth opportunity in the market place, setup they actually have and integrity of the licensees. Generally, these licensees has the contract deals of two years and within this period they get the opportunity to develop the product, launch the product and explore the opportunity that the market holds.  The duration cannot be less than this, which may not work for our benefits. For the product development duration, the locally developed products are surveyed by the brand assurance team to check whether the design is right or trademark revelation or other brand norms are followed. In this case product turn around is less than a quarter. If the product is imported, the lead time is longer, since once it goes for design, design will be sent to where it is sourced from so it takes about six months. The product category which is really doing well in the market, in terms of growth and profitability, is back-to-school. This is followed by apparel. The royalty fee ranges between 10-15%. In stage two, when the market is more mature, we will target young adults. The market is promising and our merchandising business is having a double digit growth.

Retailer: TV has access to the rural India, and cartoon channels are telecast in Hindi too. But, despite such popularity, only rich urban consumers can lay their hands on the licensed merchandise.  Is there any initiative to make licensed merchandise more pocket-friendly or any initiative to make them popular among non-metro cities?

GB: We have extended our products from metros to the class I towns. It will take a little bit of time to go beyond that. Infrastructure is not conducive enough to reach all the way down. Pretty much any category that we could think of a kid would require, we have licensed product of that, right from servicing a home to footwear, apparels, back-to-school products, video games, home videos. We have last year launched sports goods like bi-cycle, skate board, cricket bat, etc. Last year we also launched eyewear and there is an initiative with Attano where we have put up books online and a kid can go online to see the books, purchase books, they can see videos; so it’s a 3D sort of experience. We are covering approximately 5000 outlets right now.

Indian consumers are really very price-sensitive. They want really good quality products at the cheapest possible rate. Unfortunately as the licensing business is structured, most of the products are slightly premium compared to the most of the products available in the market. The reality is that when we introduce a product, we have to ensure that there’s certain quality or standard is maintained.  We have certain laws for period within which products can be manufactured, the products can be sold, etc. So, our products are slightly on higher side. If you compare Ben 10 T shirt with an ordinary T-shirts in the market, we will be having a slight premium.  But the quality of that product that we promise is much higher than a non-licensed product.  We charge a little bit more for it. But, as the licensing moves towards boom, more consumers join the fold and show their keenness to buy licensed products, the volume growth and economies of scale will dictate the pricing to come down.

Smitten by characters

Kids’ entertainment is the major source for licensing and merchandise business to thrive. The content for such programmes heavily rely on research and survey. Krishna Desai, Director, Content, South Asia, Turner International India Pvt Ltd throws light on this area.

With more choice, comes a more discerning audience and interestingly adults are just as likely to tune in these channels as kids. Audiences have total control over what they watch. In such a scenario, it becomes imperative to align content with their entertainment needs and expectations.

Shows like Chhota Bheem and Ben 10 don’t happen often. You require a perfect blend of the internal and external environment to create a mega hit show. Some of the things we consider while structuring our programming on our kids network are:

Target Audience: What is the profile of the kids who make up our target audience? What are their demographics, psychographics, their affinity for cartoons and animated content, etc.?

Language: At a very earlier stage we realised the importance of ensuring our content was made available in a language understood by the masses. That is why we started a Hindi feed for Cartoon Network and launched POGO as, essentially, a Hindi kids channel. For Chhota Bheem we go a step further. We don’t just translate the show. We rewrite its script in Hindi!

Storyline and characters: We believe in creating shows that will sustain and succeed over several years. For that, not only does the storyline have to be sound but the characters also need to have an unforgettable impact on the audience. In addition, both the storyline and the characters should have the potential to evolve as the mind-set of their TG does.

Scaling up: The show should be able to lend itself to other platforms as well. For instance, Chhota Bheem is so popular today that games based on the show are responsible for garnering over 5 lakh unique viewers every month on pogo.tv. The character also lends itself to ad sales forming seamless integration opportunities for advertisers.

Pioneers in the kids genre: We also rely heavily on all our years of experience in understanding and pioneering the kids’ genre in India.

As told to Suranjana Basu