Licence to sell

From Batman to The Beatles, 2009 has been a big year for video game licences – but now more publishers than ever are looking to go the other way and licence out their own IP. Christopher Dring takes a closer look…

Harmonix’s The Beatles: Rock Band is the perfect example of what a good licence can bring to a video game.

From the NME to the BBC, the game received more coverage than almost any other title this year, propelling it to fourth in the ChartTrack Top 40.

And the product joins a plethora of fast-selling licensed games in 2009, including Ashes Cricket, Transformers and Batman: Arkham Asylum. Meanwhile, licensed properties are expected to do the business this Christmas too, with the likes of FIFA 10 and Mario & Sonic at the Winter Olympic Games both certain to sell in the millions.

And now the games industry is gearing up for Brand Licensing Europe (pictured), where publishers will try and sniff out the right property that can offer brand recognition, big sales and a longer shelf life.

Our focus at D3 has shifted towards the kids market with a focus on licensed products because the development lifecycle is shorter but the product lifecycle is infinitely longer,” says D3P’s marketing manager Suzanne Sutton.

Ben 10 provides solid gameplay designed for kids, but there’s no way we’d have sold three million units without the Ben 10 brand.”

Blast product director Neil McKenna adds: With Blast the intention was to offer something to parents who may not have an instinctive understanding of games. When they see Bob the Builder on the box, they know that the game is going to be child friendly. It would take years to build one’s own brand equity from scratch to that level.”

It’s not just for the publishers either, with peripherals companies experimenting with licences, resulting in products such as Purple Ronnie DS cases of Fitness First Wii accessories.

When the brand is really strong and in a market where innovation is key, licences can play a significant part in creating that essential point of difference,” says Venom’s marketing manager Tom Hodge.

A licence needs to appeal to a wide demographic. Thanks to Nintendo, licences no longer need to be game specific, which has opened up some exciting new opportunities.”

Yet it’s not just the games industry that benefits from licensing products. Many licensors look to the games market as a means to extend the reach of a brand to a whole new audience.

When a video game licensor comes on board it is a turning point for the entire programme,” explains Vickie O’Malley, UK MD of the Copyright Promotions Licensing Group.

Video game partners are so important because games are high profile products and sales can be very lucrative. But also because the marketing campaigns games companies put behind their products can be beneficial to the overall program.”

A TWO-WAY STREET
Over the past three years there has been significant changes in how the games industry approaches licensing. As games head further into the mainstream, companies are beginning to experiment with unique licences that weren’t considered appropriate in previous console generations.

The expansion of the games market – thanks to the increase in casual gamers – has made a larger number of licences viable,” comments Paul Comben, the co-founder of video game licensing specialists AT New Media.

For example, Dr Kawashima would not have been able to lend his name to a video game in the days of hardcore PC and PSone gamers, nor would Peppa Pig be
as successful on N64 as it is on Wii and DS.”

Despite the rise in alternative licences, video game firms are being more discerning when it comes to traditional movie and TV IP, as Janet Woodward, head of licensing at Coolabi, explains: Publishers are getting more selective and looking for longer term properties rather than the latest blockbuster movie – unless it’s a top franchise like Bond or Lord of the Rings.”

Yet an even bigger change for the licensing industry is the quantity of publishers wanting to become licensors and grow their IP beyond the video game space.

There has been a definite change in publishers licensing out their own properties,” says E1 Entertainment licensing manager Hannah Mungo.

Gaming properties are becoming brands in their own right and are being licensed onto other products.”
Helen Howells, global brand director at Target Entertainment Group which handles licensing for PlayStation IP, agrees: From a licensing point of view gaming is a potentially lucrative area. It’s the fastest growing entertainment sector; it attracts an increasingly diverse demographic, and the fact that games can be played any time and are not dependent on TV or theatrical scheduling allows for a more flexible product rollout strategy.”

However, O’Malley feels publishers and developers still need to better understand the licensing industry: Video game corporations need to get their heads around licensing and how it works and what it all means for their business,” she says.

You’ve got to have a philosophy on how you want your licence to look or feel – because how something feels in a game by nature might be quite different to how it feels when a publishing book or on a duvet cover. You have to take into account what is needed by those different marketplaces.”

SHIFTING ATTITUDES
Traditionally video games companies pick up licences with global appeal such as one for a blockbuster movie. However, games companies are going increasingly local – and securing rights to IP specific to an individual region.

The video game market is bigger than Hollywood, but development costs are so high and America is so important to that market.” says Rob Corney, MD of agency Bulldog Licensing.

So your brand might be the strongest brand in international territories, but if it’s not hot in the US then the US publishers don’t want to touch it. The licensors want to work with the big publishers, but perhaps working with developers on a local basis could be the stronger route to market.”

Another route to market for licensors is through the digital space. Although the games industry is growing, there are concerns that certain IP might not be able to break through the clutter at retail and instead are appearing on services such as Xbox Live Arcade or PlayStation Home.

We are currently looking at mediums such as Home or a more unique roll-out of mini-games for our Monty Python brand,” comments Mark Hurry, director of legal and commercial affairs at PPC Enterprises.

We see the interactive side of things outside of the traditional video game route becoming more prominent. An online approach allows you to tickle the market to see the reaction before positioning it for a mainstream release.”

Indeed, the licensing world for games is very different to how it was ten years ago. Publishers are not just visiting Brand Licensing this year; they are showcasing their own IP. Properties that were once considered inappropriate for games are being snapped up, and that’s not to mention the rise in digital, the increase in local licensing and the new trend of combining licences, such as with the upcoming Mario & Sonic at the Olympic Winter Games and LEGO Rock Band.

Yet in the face of all these changes, traditional licensing continues to thrive – and the quality of licensed software is on the rise. At the time of going to press the top four in the ChartTrack Top 40 are games built on licensing deals, and each one of them enjoyed a Metacritic rating of over 90.

Comben concludes: It is now a clich to accuse a licensed g