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Meet the new celebrity endorsers: Six-year-old misfit Fred Figglehorn; song parodist VenetianPrincess and a 19-year-old from Ohio named Mitchell Davis who shares his observations about everything from music videos to toilet paper.
This story first appeared in the August 18, 2009 issue of WWD. Subscribe Today.
They have no big movies to promote, no HBO specials, no network sitcoms — at least not yet. They’re the new generation of quirky YouTube stars who inspire mass followings and are evolving into brands selling licensed merchandise of everything from bags to beauty products.
Their videos on Google-owned YouTube, which are being viewed millions of times, are catnip to retailers and brand managers eager to tap into the Web site’s popularity with teens and preteens.
Hot Topic Inc., the teen-focused retailer with 679 Hot Topic stores and 156 Torrid units that scored a hit with product from the movie “Twilight,” has been a pioneer in selling YouTube-related goods.
“Our marketing and merchandising efforts have included social networking for the past three years,” said Betsy McLaughlin, chief executive officer of the City of Industry, Calif.-based company. “We started with MySpace as it was — and still is — a great source of new music. We also carried graphic Ts licensed by MySpace. Over the years, we have expanded our presence to include YouTube, Facebook, Twitter, blogs and other user-generated content sites. The Internet continues to be a place to ‘hang out’ for our target customers….As properties and trends gain exposure and acceptance on the Web, they create assortment opportunities.”
To support their leap from the virtual to the non-virtual world, YouTube personalities with large followings, distinctive concepts and buzz have hired agents and managers and are beginning to secure licensing deals.
One of the hottest is 15-year-old Lucas Cruikshank. He started posting videos four years ago from his home in Columbus, Neb., creating Fred Figglehorn, a fictional six-year-old misfit with a falsetto who is at the center of episodes with a cast of unseen characters, including a crush named Judy, a nemesis known as Kevin and an alcoholic mother.
Some videos get as many as two million to more than five million views. That kind of exposure compares favorably with the HBO hit “True Blood,” which has averaged about 3.8 million viewers. Fred’s YouTube channel has close to 1.3 million subscribers, the most on Google-owned YouTube, and Fred videos have notched a total of more than 323 million views.
The Fred Figglehorn licensed apparel is being produced by Chaser; children’s apparel with NTD Apparel Inc.; bags, backpacks and footwear by E.S. Originals Inc.; stickers and notebooks by Hot Properties, and novelty items and toys by Fundex Games Ltd., Kamhi World and Think Wow. Fred shirts have started rolling out to the Tween Brands Inc.-owned Justice for Girls chain (the former Limited Too), with 915 stores, as well as to Hot Topic.
Bruce Giuliano, a partner at the Giuliano/Rafferty Branding Group, who is putting together the portfolio of licensed Fred goods, said it hasn’t been easy convincing adults — himself included — that Cruikshank’s character can translate into sales because they often don’t know about him. One of Giuliano’s tactics is to get executives to ask their children if they like Fred videos.
“We were showing the videos to a potential licensee who happened to have his kid in the office,” Giuliano recalled. “The kid had memorized several of the videos…telling the dad why he should take a license.”
To be sure, a YouTube following isn’t a proven sales tool yet.
Davis, a commercial artist from Springboro, Ohio, has become a hot property since last year when he created Livelavalive, which involves him speaking into a camera about almost anything. His YouTube channel has about 275,000 subscribers and each of his videos has drawn several hundred thousand views.
“I really didn’t expect anyone to be watching,” Davis said. Asked about fostering a brand based on YouTube’s popularity, he added: “We are walking this path with our eyes closed.”
With an oversaturation of celebrities pushing their brands, the YouTube personalities provide an alternative. Unlike staples such as Jennifer Lopez and Paris Hilton, whose labels have struggled in the recession, they have organically grown audiences and an authenticity that’s tough to manufacture.
“Every talent agency and every licensing agency out there is scouring the Internet every day looking for the next new phenomenon,” Giuliano said. “When we saw Fred, it became perfectly clear just by looking at the number of views that this guy had something.”
During a recent visit to the Hot Topic at Hollywood & Highland shopping center in Los Angeles, four Fred shirt styles priced at $22 — one read “I’m not a stalker” and another “Hi, it’s Fred” — were available, as well as a Livelavalive shirt. Inside the store, Margo Robertshaw, a 16-year-old student from Australia, said she would buy a Fred shirt. “I just think they’re funny,” she said. Yasmin Aazanakhsh, a 17-year-old student at a Los Angeles area high school, described YouTube merchandise as “really cool.”
Justice for Girls caught on to the phenomenon after co-president Lece Lohr said she noticed “someone named Fred was more popular than the Jonas Brothers” in an online trend survey of girls and mothers about celebrities on their radar. Lohr, 51, who didn’t know Fred Figglehorn from Fred Flintstone, sent her merchants on a mission to bring in Fred shirts.
Once in the Justice for Girls stores, Lohr said the $19.90 shirts “flew off the shelves in the first couple of days.” For holiday, Justice for Girls is expanding its Fred program to include bags, backpacks and other items, and setting up dedicated merchandise displays. The chain has also signed an agreement with Fred’s creator, Cruikshank, to do spots running in the stores and mention Justice for Girls in a YouTube video.
On a slightly smaller scale, other YouTube personalities mirror Cruikshank’s Fred alter ego. Lauren Luke, 27, known as Panacea81, a single mother from South Shields, a coastal town in northeast England, broadcasts makeup tutorials from her bedroom. She shows, for example, how to re-create pop singer Leona Lewis’ eye shadow or how to set perfect foundation. She has garnered more than 50 million views.
Jodie Rivera is the 25-year-old Bostonian behind VenetianPrincess, which launched on YouTube two years ago with fantasy-oriented videos such as the “Princess Chronicles” and has since segued to performances of celebrity parodies, including one of the Britney Spears’ song “Womanizer.” Her videos have been viewed more than 115 million times. Most of her fans are 12- to 17-year-old girls, she said.
Cruikshank has an agent at Beverly Hills-based United Talent Agency, which started an online division in 2006 and is wooing popular YouTube personalities, as well as a manager at The Collective Management Group LLC, also in Beverly Hills. He wants to establish himself as an actor, and has signed to star in “Emo Boy,” a film adaptation of the graphic novels by Stephen Emond.
YouTube personalities have a lot to gain from rising acceptance. Rivera said she might receive “75 percent of the wholesale price” of the sales of T-shirts she wants to sell at Target and Claire’s Stores Inc. The retailers did not respond to requests for comment.
Between advertising and other ventures, including an album for DFTBA Records and possibly a television gig and accessories, Rivera estimated her yearly earnings could be well into the six figures.
“They can make a decent living,” said Kevin Khandjian of AKT Enterprises, who manages Davis. AKT also owns District Lines, which produces shirts for Davis and Rivera.
“Not everybody knows about YouTube, which sounds ridiculous,” Khandjian said. “When they find out about it, they come back and watch it more. As long as that keeps happening, money can be made on T-shirts.”
Duncan Bird, a partner in the advertising and branding agency Anomaly in London, said Sephora understood immediately that By Lauren Luke, the beauty line from YouTube’s Panacea81, would have widespread appeal because of the “real dialogue” between Luke and her viewers, who comment on her videos and request video topics. The brand, which is manufactured by beauty product specialist the Maesa Group and promoted by Anomaly, launched at Sephora’s new Times Square location on July 31 with five $32.50 kits and is spreading to 135 U.S. stores in September.
“If you are faced with a choice of a very well-known corporate brand or a product that has been developed with an individual you have a close connection with, you will choose the person you have a close connection with,” Bird said.
Bryan Barton, co-founder of iStardom, which ranks Internet celebrities and is launching an initiative to link beauty advertisers with the top 50 companies in the beauty category, said YouTube “is a perfect medium for beauty because you are able to do the visual. It is like a friend teaching you how to put on makeup.”
Khandjian said some retailers have been slow to jump on the YouTube bandwagon, partly because the recession deters risk taking. More retailers, though, may be warming to the idea.
Charlotte Russe, which is planning its own YouTube channel, hasn’t created a merchandise partnership with social media personalities, nor does it carry Internet-related apparel. But director of e-commerce Craig Gillan said: “If they are the right blogger or the right YouTube personality and what they are saying will resonate with our customer…that may very well happen as this all starts to mature.”
The commercialization of YouTube personalities, however, has perils. They may seem less genuine when they promote their own brands as well as other brands, which can pay as little as $10,000 for product placement in two minute videos by top YouTubers. Companies from movie studios to fast-food chains to lingerie brands are getting into the YouTube product placement game.
“We try to walk a fine line,” said Giuliano, speaking of Fred and product placement. “We believe that the audience…is very sensitive to that kind of manipulation. They demand a certain authenticity.”
Most YouTube personalities try to limit their exposure to potentially compromising partnerships. Bird said Luke would continue to mention makeup brands that aren’t sponsors in her YouTube videos even though she may stand to benefit by peddling hers alone.
Davis stressed his “number-one rule” is not to wear his own shirts in his videos.
The temptation to cash in on YouTube fame may be overwhelming. “At some point, your audience is going to go to college and stop watching you,” Khandjian said. “I don’t know how long it is going to last….This is still the first generation of these people.”
Davis, who wants to produce music videos and continue to work on his art, isn’t betting on YouTube for life, although he’d like to make enough to move out of his parents’ house.
“I am not always going to be doing [YouTube] stuff,” he said. “Once I get to a certain age, I don’t think people will find it appealing. People will find it creepy.”