Are Branded Goods Licence to Overkill?

By Marsh, Harriet | Marketing, February 15, 1996 | Go to article overview

Are Branded Goods Licence to Overkill?


Marsh, Harriet, Marketing


Avid fans of Sony Playstation - and it has a few - will soon be able to show their allegiance to the brand through a range of licensed products.

Sony has already signed up with licensing agent Patrick Sinfield Limited (PSL) in a deal that will spawn a range of branded accessories from carrying cases to clothing.

"We are only looking at half a dozen deals in the first year," says PSL director John Sin field.

Playstation's move into licensing follows hot on the heels of another youth brand, MTV, which has already started the roll-out of a range of branded goods.

Fresh fields

MTV's pre-Christmas launch of CD MTV Fresh will be followed during the coming year by 12 videos, including the first release for cult comic heroes Beavis and Butthead, a range of MTV publications, including MTV magazine Blab Blab Blab, which launches on March 14, MTV CD-ROMs and CDis and a clothing range, which is already on sale through the retail trade and expected to appear in-store in the next month.

"We have discovered there is a huge pent-up demand from the consumer," says MTV's director of licensing and merchandising Julia Sadd.

But how far can licensing deals push the core brand - and is there the danger of consumer overload?

Licensing through brand extensions is not a new idea but it is growing rapidly in the UK.

"In terms of the worldwide market, the licensing of kids' characters is pretty much a saturated marketplace," says an industry analyst. "The real growth area - in Europe at least - is in brand extensions."

Not only is it growing but it is also becoming seen as an established part of the marketing mix.

"It is on the increase and now considered to be a legitimate way of publicising your brand in different areas of the marketplace," says Sinfield.

When successfully managed, licensing an established corporate or product name can have both marketing and commercial advantages.

In terms of revenue opportunities, licensing deals can be highly profitable. MTV is reportedly hoping for revenue in excess of [pounds]1m annually in the UK alone from the brand extensions currently in development. …

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