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Character Merchandising - US

Published by: Mintel International Group Ltd.

Published: Aug. 1, 2009 - 89 Pages


Table of Contents


Scope and Themes

What you need to know

Definition

Data sources

Sales data

Consumer survey data

Advertising creative

Abbreviations and terms

Abbreviations



Executive Summary

Sales decline rapidly as consumers become more frugal

Population growth among kids aged 1-11 offsets some losses

Case studies

Insights and opportunities

SpongeBob SquarePants and iCarly among the most popular characters

Sesame Street viewed as good influence by most adults

Most adults report that character merchandise is not a good value

Adults most likely to report purchasing food and personal care products

Fast food and t-shirts especially popular with parents

Young adults more likely to report increased spending

Most kids cite media as part of their favorite activities but feel school is important



Character Merchandising Case Studies

Case Study 1: Largest film franchise ever rolls out museum exhibit and theme park

Harry Potter: The Exhibition

Harry Potter: The Theme Park

Case study 2: Fast food chains remain a prime target for licensing opportunities

Self-regulation doesn’t work

Case Study 3: Higher-end apparel tie-ins making waves

SpongeBob gets precious with 12-carat diamond jewelry

Disney and Warner Bros. wooing designer crowd

Case Study 4: Video game tie-ins drive growth in a struggling category

Electronic Arts tops 1 million units with Harry Potter

Case Study 5: Mobile gaming tie-ins are heavy on film adaptations



Market Size and Forecast

Key points

Retail sales and forecast of entertainment/character merchandise

Sales and forecast

Figure 1: Retail sales of licensed entertainment/character merchandise, at current prices, 2004-10

Figure 2: Retail sales of licensed entertainment/character merchandise, at inflation-adjusted prices, 2004-10



Segmentation and Distribution

Key points

Entertainment/character merchandise segments

Figure 3: Retail sales of licensed entertainment/character merchandise, by product category, 2006 and 2008

Distribution of licensed entertainment/character merchandise

Figure 4: Distribution of licensed entertainment/character merchandise, by retailer type, U.S. and Canada, 2006 and 2008



Competitive Context

Agelessness trend increases threats from celebrities, sports and trademarks/brands

Figure 5: Sales of licensed goods, by property types, 2006 and 2008



Market Drivers

Increasing number of children bodes well for market growth

Figure 6: Population, by relevant age groups, 2004-14

Minority populations key to market growth

Figure 7: Population, by race and Hispanic origin, 2004-14

Figure 8: Households, by presence of children—Hispanics vs. non-Hispanics, 2006

Recession boosts movie admissions

Figure 9: Sales of movie tickets at box office, 2004-14

Rise of the Screenager: Online and gaming platforms beg customization, interaction

Figure 10: Hours of filmed entertainment consumption per person per year, 2003-07

Figure 11: Activision’s Transformers: Revenge of the Fallen (video game) television ad, July 2009

Figure 12: Hours of game play—kids, by age and age/gender, October 2007-December 2008

Figure 13: Incidence of game play while connected to the web—kids/teens, by age and gender/age, October 2007-December 2008



Most Popular Characters and Role Models

Key points

Kids’ favorite characters

Figure 14: Hasbro’s Connect 4 SpongeBob SquarePants Edition television ad, July 2009

Figure 15: Kids’ favorite characters/shows, by age, April 2009

Characters viewed as good role models

Figure 16: Cartoon and movie characters seen as good role models, by age, May 2009

Cartoon characters designed for adults most likely to be seen as a bad influence on children

Figure 17: Perceptions cartoon and movie characters as good role models or not appropriate for children, May 2009



Attitudes Towards Character Merchandising

Key points

Products with characters not seen as good value

Figure 18: Value perceptions of character merchandise, by age, May-June 2009

Social influence does not drive sales among adults; many concerned about potentially negative impact in children

Figure 19: Influence of character merchandise on purchasing behavior, by age, May-June 2009

Characters lead to pestering

Figure 20: Attitudes towards character merchandise; pester power, and childhood memories, by age, May-June 2009

Ambivalence about using characters to educate children

Figure 21: Attitudes towards using characters to educate kids, by age, May-June 2009

Most parents, especially men, unsure about how characters motivate child’s behavior

Figure 22: Influence of character merchandise on children’s product preferences, parents by gender, May-June 2009

Impact of income on influence of characters on children’s product preferences

Figure 23: Influence of character merchandise on children’s product preferences, by household income, May-June 2009



Purchase of Character-linked Products

Key points

Food, clothing and personal care top the list

Figure 24: Purchase of character-linked products, by type of product and nature of purchase, May-June 2009



Products Parents Buy for Their Kids

Key points

Characters drive food purchases; moms generally more likely to be purchasers

Figure 25: Character merchandise purchased for child/children in the last 12 months, by gender, May-June 2009

Lower-income households more likely to buy character merchandise

Figure 26: Character merchandise purchased for child/children in the last 12 months, by household income, May-June 2009



How Parental Attitudes are Evolving in Recession

Key points

About one in three report buying fewer character products than last year but nearly half are buying the same amount

Figure 27: Purchase of character merchandise relative to last year, by age of parent, May-June 2009



Children’s Attitudes Toward Media, School, Friends and Self

Key points

Television is a favorite pastime of most respondents under 12

Figure 28: Kids’ attitudes towards TV, movies and video games, by gender and age, October 2007-December 2008

Most enjoy school and think academic work is important

Figure 29: Children’s attitudes towards school, by gender and age, October 2007-December 2008

Most kids report being quite social; demand for social networking likely to continue growing as kids become teens and adults

Figure 30: Children’s attitudes towards friends, by gender and age, October 2007-December 2008

Most feel confident, curious and distinct from parents

Figure 31: Children’s personal preferences and attitudes about self, by gender and age, October 2007-December 2008



The Impact of Race and Hispanic Origin

Key points

Child’s favorite cartoon or movie character

Figure 32: Hannah Montana’s The Hannah Montona Light-up Dance Lounge television ad, July 2009

Figure 33: Child’s favorite cartoon or movie character, by race/Hispanic origin, May-June 2009

Character merchandise purchased in the last 12 months

Figure 34: Character merchandise purchased in the last 12 months, by race/Hispanic origin, May-June 2009



Appendix: Additional Consumer Tables

Demographic comparisons of parents

Figure 35: Use of character merchandise relative to last year, by gender, May-June 2009

Figure 36: Influence of character merchandise on children’s preferences, by age, May-June 2009

Figure 37: Influence of character merchandise on children’s preferences, by race/Hispanic origin, May-June 2009

Figure 38: Perception of child’s favorite cartoon or movie character, by gender, May-June 2009

Figure 39: Perception of child’s favorite cartoon or movie character, by age of parent, May-June 2009

Figure 40: Perception of child’s favorite cartoon or movie character, by household income, May-June 2009

Favorite programs of boys and girls aged 6-17

Figure 41: Kids’ favorite characters/shows, by gender, April 2009

Additional demographic comparisons of adults who are not parents

Figure 42: Attitudes towards price and quality of character merchandise, by household income, May-June 2009

Figure 43: Influence of character merchandise on purchasing behavior, by household income, May-June 2009

Figure 44: Attitudes towards character merchandise, by household income, May-June 2009

Figure 45: Attitudes towards price and quality of character merchandise, by race/ethnicity, May-June 2009

Figure 46: Influence of character merchandise on purchasing behavior, by race/Hispanic origin, May-June 2009

Figure 47: Attitudes towards character merchandise, by race/Hispanic origin, May-June 2009

Figure 48: Good role models, by household income, May 2009

Figure 49: Good role models, by race/Hispanic origin, May 2009

Figure 50: Inappropriate role models, by age, May 2009

Figure 51: Inappropriate role models, by household income, May 2009

Figure 52: Inappropriate role models, by race/Hispanic origin, May 2009

Figure 53: Classic characters, by age, May 2009

Figure 54: Classic characters, by household income, May 2009


Abstract

There is little doubt that the recession is driving many parents—and even some kids—to be more frugal as they shop for back-to-school supplies and other goods. This is creating a context within which many parents are shopping more carefully than ever before as they search for exceptional value. As reported by The New York Times in August of 2009, back-to-school spending is expected to fall 3-4% in 2009, compared to a 1% increase in 2008. While parents continue to buy school supplies and new clothing to prepare for the coming year, it is also clear that many are using coupons, scouring the internet for sales and bargains and trading down from specialty retailers to less expensive options such as dollar stores and mass merchandisers. These are especially important facts to bear in mind when one considers, as explained in a subsequent section of this report, that 76% of adult respondents agreed that “products or foods with characters tend to be over-priced.”

Within this context of heightened price sensitivity it is important to create initiatives that engage customers in a manner that invites purchase as well as loyalty. Customization may be among the most effective ways of achieving these goals and is an approach especially appropriate for clothing retailers and manufacturers. The website TysToyBox.com, for instance, offers a service wherein parents (or kids) can choose the size, color and character on t-shirts (e.g., a blue, medium SpongeBob SquarePants shirt) and then customize it with the child’s name or other term. The site also offers competitive pricing and coupons.



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