This post is by Kelvyn Gardner, Managing Director of the Licensing Industry Merchandisers' Association.
2015 has seen a continued expansion of the ever-growing licensing industry. Our recent figures showed that $13.4 billion was made in royalty revenues and $241.5 billion in retail sales last year from licensing and this is set to continue to increase well in to the new year.
So with 2015 coming to an end, what are the top five things we are expecting to see in the licensing industry in 2016?
1. Explosion in film licensed products
2015 was the year in which films re-established themselves as firm favourites for the licensing industry with notable blockbuster hits including Jurassic World, Minions and Star Wars - originally kick-started by the popularity of Frozen at the end of 2013. The success of these films created exciting areas for licensees and retailers to invest in, and this is on track to continue with the launch of Ghostbusters, Angry Birds, The BFG and Finding Dory in 2016.
Another interesting layer to the movie trend will be when the Assassin's Creed film is released, the latest in a line of films taken from a video game. To date, such films have not had great commercial or critical success, but many bets are on this one to be the first to break out in licensing.
2. Increase in British brands re-inventing themselves
This year we saw the revival of much loved British brand Thunderbirds return for a new series, as well as Danger Mouse and the Clangers - all three classic brands have also expanded their licensed products in the retail sector to include clothes, books and plush toys. Further licensed products will be rolled out over the next six - twelve months which is a trend we often see when new brands reinvent themselves and reach new audiences.
Next year will see the start of the production of a new Paddington Bear film - another much loved classic British brand that was brought back to life with the release of the first film in 2014.
3. Continued success of TV licensed products
Successful television programmes in 2015 have included Downton Abbey, The Great British Bake Off and Game of Thrones. All properties surpassed viewing expectations with record breaking viewing figures. The international success of Downton Abbey and Bake Off has also extended their licensing potential, bringing licensed products to a grown up audience.
In the licensing industry, it will be interesting to watch the development of subscription players Netflix, Amazon Prime and YouTube's Red in to the market and how this will effect television licensed products. We've seen an increase in licensed products coming from vloggers this year and due to their popularity I can't see this going away any time soon.
4. Development in consumer electronics
In the industry, the top licensing property type is 'character and entertainment', with a 44.4% share of the retail market. This category of licensing encompasses properties springing primarily from feature films, television shows, video games and online entertainment, but what we are predicting in 2016 is a rise in the consumer electronics category, (such audio and video equipment, computers and computer accessories, mobile cases, headphones).
This will be down to an increase in products such as drones and app and radio controlled devices - including vehicles, and audio products like headphones and Bluetooth speakers. Sci-fi and fantasy lend themselves especially well to CE products so brands like Halo (the video game), Star Wars, Independence Day and, eventually, Avatar are likely to feature strongly.
5. Popularity of video games
$671 million was made in retail sales of software/video games based on licensed properties in the UK last year and it is increasing year on year. This year Super Mario turned 30 and next year Sonic the Hedgehog will turn 25 - both strong video game brands. There will also be the launch of a new Halo game (Halo Wars 2) which will see them grow their licensing programme.
Revolutionary technology has brought new ways to the market to reinvent gaming and in turn licensed products based on gaming, a great example being Minecraft. Pokemon and Nintendo has also rebuilt their audience base over the last year.