Fashion brand licensing's best year in the past 15 was back in 1999 when it generated $13.5 billion in retail sales in the U.S. and Canada, and was the fourth-biggest license sector, after corporate brands/trademarks, entertainment/character and sports, according to The Licensing Letter. Its weakest performance was last year, when it produced a significantly smaller $9.05 billion.
Now the fashion licensing business is aiming to break the shackles of a weak U.S. economy on the strength of burgeoning demand for exclusive retail agreements, revivals of underdeveloped properties and dormant past favorites, and celebrities in search of branding deals, plus forays abroad, notably in China, India and Brazil — markets expected to grow stronger in the next three to five years. Jones Apparel Group, for example, said Monday it acquired a minority interest in GRI Group, its exclusive licensee in Asia for Nine West and Anne Klein New York, among other labels.
Charles Riotto, president of the International Licensing Industry Merchandisers Association, pegged the global licensing business at $187 billion in annual volume overall and projected it will hit $220 billion by 2010, with a healthy assist from international efforts, during a recent media briefing on the state of the sector.
In difficult times, said Andy Topkins, a managing partner at brandgenuity, "more licensors are on the hunt, but there are fewer takers."
"In better times, there are lots of [potential] licensees shopping, but less is available," Topkins added in an interview, estimating license programs developed by his firm are resulting in annual retail sales of $350 million.
The "banking environment" has had a dampening effect on acquisitions, noted Neil Cole, chairman and chief executive officer at Iconix Brand Group, which has not bought a brand in the first half of 2008 after purchasing 12 of them in the previous 12 quarters. Earlier this month, Iconix, which owns, licenses and manages a portfolio of 16 brands that are on average 50 years old, revised its full-year revenue estimate down by $30 million — an amount that was based on anticipated brand acquisitions — to $215 million to $220 million.
"Business has been pretty choppy to say the least," Cole said. "Some of the brands are up in the single digits and some are flat." Asked to identify the strongest performing fashion labels among the 12 Iconix owns, he cited Ocean Pacific and London Fog.Fashion licenses in development at brandgenuity include one with swimwear model Molly Sims, which would initially focus on intimate apparel, sleepwear and loungewear, and another with the MGM entertainment franchise "Legally Blonde," for a range of items for teens and tweens, such as pink-and-black houndstooth blazers and pink eyewear, pink T-shirts and white polo shirts with a pink interlocking LB logo and image of chihuahua Bruiser. The sensibility of the "Legally Blonde" fare is to suggest being both pretty and smart, while the Molly Sims products envisioned, including fragrance and home goods, speak to the 35-year-old model's roots as a native Kentuckian, with a nod to vintage silhouettes, antiques and keepsakes.
The brandgenuity team is "in serious talks with midtier department stores for a spring 2009 launch" of "Legally Blonde" fashion goods and is "in talks with manufacturers and hoping to have a Molly Sims deal done in the next couple of months," Topkins and fellow managing partner Adina Avery-Grossman said.
Fast-changing economic dynamics are sparking some licensing forays, like efforts by Jeep to develop luggage that's smaller and lighter, in response to newly instituted charges for baggage checked on major airlines. "We're working with Olivet Luggage to resize Jeep luggage to be lighter and consistently conform to the 22-inch limit on checked bags and to the 30-pound limit, to avoid charges," said Debra Joester, president and ceo of brand licensing agency The Joester Lauria Group.
Consumers' craving for the comfort of retro flavor, in part, has been prompting deals such as Kohl's recently announced plans to revive American Brand Holdings' Hang Ten surf brand, conceived in the Sixties and last active in apparel about five years ago, with exclusive apparel and accessories next spring, and the offer this spring of Pepsi-Cola licensed T-shirts, activewear, denim and dresses for East Coast urban teens and tweens. The Pepsi products go into 120 specialty stores nationwide this fall. The clothes also are being worn by women's staff at Pepsi Blue Carpet promotional parties, following the MTV Music Awards Sept. 7 in Los Angeles and the Latin Grammy Awards Nov. 13 in Houston.
"The U.S. has become a more active culture and the Hang Ten brand speaks to that," said Frederick Horowitz, a managing partner of American Brand Holdings, owner of the 46-year-old label, which may be extended to luggage and home goods. In tempestuous times, he posited, the surf brand can be "an island of stability, something people can know and reach."In light of weak consumer spending on apparel, brand marketers ought to be sharply discriminating in affixing new licensed names to their products, observers emphasized. Celebrity-licensed apparel, for example, "is being evaluated versus existing apparel on offer — not in a vacuum," observed Avery-Grossman of the long list of entertainers who want "to grow their equity in related [product] categories."
"The question is what do they bring besides their name to the table?" Avery-Grossman continued. "Do they have a passion for a unique design, for a particular activity? They have to be involved and credible," she noted of an increasingly sophisticated marketplace. "Retailers aren't holding a place for any particular celebrity-licensed line."
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
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To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye