Global retail sales of licensed merchandise and services hit $280.3 billion in 2018, a 3.2 per cent increase over the $271.6 billion generated in 2017, according to results of the fifth Annual Global Licensing Survey, released today by Licensing International.
Licensed toys suffered a 2.1 per cent decline in sales, says the report, owing to the hangover from Toys R Us’ closure. That said, the market still accounts for 12.6 per cent of overall licensing sales.
Royalty revenue for brand owners leapt to $15 billion, an almost four per cent increase from 2017.
The US and Canada accounted for 58 per cent of worldwide consumption of licensed goods and services with $162.6 billion (up 3.1 per cent from the prior year), while the Latin America, Northern Asia and Southern Asia/Pacific markets experienced the strongest year-over-year increases in licensing business, each showing growth of more than five per cent for the year.
Licensing International – known previously as LIMA – commissioned Brandar Consulting, LLC to conduct the survey for the fifth consecutive year. The survey results have shown steady growth year-over-year, with a 16 per cent leap in revenue over the course of the five years the survey has been conducted.
Survey respondents reported that an average of 79 per cent of business came from brick-and-mortar stores in 2018, compared to 21 per cent from online sales. Those are the same average percentages reported in the prior two years.
The entertainment/character sector was the largest category, accounting for $122.7 billion, or 43.8 per cent of the total global licensing market. The second-largest sector – corporate brands – showed the highest growth rate (5.5 per cent year over year) of the top four sectors with $58.8 billion (21 per cent) of the overall business, attributed to the staying power of name brands in today’s challenging retail environment.
Fashion was the next largest ($32.2 billion, 11.5 per cent), followed by sports ($27.8 billion, 9.9 per cent).
Apparel (15 per cent), toys (12.6 per cent) and fashion accessories (11.5 per cent) continued to lead in the breakdown by product category, though the global toy sector experienced the largest decline, down 2.1 per cent from 2018, in part due to the market disruption caused by the bankruptcy and ultimate liquidation of Toys R Us in the US and some other world markets.
“The 2019 Global Licensing Survey drives home the fact that licensing continues to be a vital part of the consumer marketplace, and a versatile tool for brand owners and licensees to creatively build their businesses,” said Licensing International president Maura Regan.
“This year’s results highlight licensing’s wide reach, value and potential in both developed and growth markets. It’s an exciting time to lead the licensing business into its promising future.”
The complete report, including regional and country-by-country breakdowns for major markets, will be made available free to all Licensing International members this summer. Non-members will be able to purchase the survey for $975 at www.LicensingInternational.org.