NEW YORK — David Litterman feline T-shirts, "Baywatch" Barbie dolls and visions of best-selling merchandise based on the next blockbuster movie danced in the heads of manufacturers this week at Licensing '95, an exposition for the $100-billion-plus worldwide merchandise-licensing industry.
Warner Bros. MCA/Universal, Sony Pictures and other studios, along with the Fox, Nickelodeon and Turner Home Entertainment networks, were among the giants that exhibited their current and upcoming entertainment products at the annual event, attended this year by an estimated 10,000 people over the first two days of the three-day conference.
Licensed merchandise is an increasingly important revenue source and sales tool for movies and TV shows. Looking for the next "Lion King" or "Jurassic Park"--and avoiding betting on the next "Flintstones," a licensing hit from the TV cartoon but a merchandising disappointment as a movie--is the object of the exhibition. About 2,000 products (real and imaginary) were on display on several floors of the New York Hilton.
Among the upcoming movies being talked about by manufacturers as potential merchandising hits are "Dragonheart," a 10th-Century dragon-slaying epic (starring Dennis Quaid and Sean Connery) from MCA/Universal; "Space Jam," which will pair basketball player Michael Jordan (in his movie-star debut) with Looney Toons cartoon characters from Warner Bros., and "The Real Adventures of Jonny Quest," based on the animated TV series that airs on Ted Turner's Cartoon Network.
"We believe that 'Dragonheart' will have merchandising sales of $1 billion in retail sales, on a par with 'Jurassic Park,' " said John Dumbacher, vice president of licensing sales and retail for MCA/Universal Merchandising.
The company recently reached agreement on "Dragonheart" toys and video games with Kenner Toys and Acclaim Entertainment, Dumbacher said, and it expects to have about 75 tie-ins, including one with a fast-food chain, for the movie, which comes out next summer.
Daniel Romanelli, president of worldwide consumer products for Warner Bros., estimated that $1 billion in merchandising sales will be generated by the company's current summer hit, "Batman Forever." He said "Space Jam," announced this week at the exhibition, has already generated "tremendous interest" among potential licensees, although Warner Bros. and the current licensees of Jordan's shoes and clothing will have to work out how they divvy up the "apparel rights" in connection with the movie, which is scheduled for release next summer.
Although theatrical releases get more attention, industry observers say a successful TV series can be a safer bet.
"Manufacturers have to take a gamble a year in advance on a theatrical film," said Karen Raugust, executive editor of Licensing Letter. "A successful TV show builds more slowly--but it can make a lot of money over time."
Product licensing for entertainment characters racked up gross retail sales of $17.2 billion in 1994 in the United States and Canada, an increase of 9% from 1993, according to Licensing Letter.
Raugust said it is too soon to project 1995 merchandising revenues, but she said there could be some downturn from 1994. With the economy uncertain, store owners may grow more cautious.
Kevin Croen, marketing manager for Tsumura International, which markets toiletries, said he had not made up his mind yet about licensing the live-action "Dragonheart" for children's toiletries. But he said his company--which grossed $50 million in retail sales last year with children's bubble bath and other products and recently licensed "Pocahontas" products--is interested in licensing "The Tick," an animated Fox TV series for children. Referring to the blue, 400-pound arachnid super-hero, Croen said, "We think The Tick has possibilities for our products, including children's bandages and bubble bath."
Entertainment companies and product manufacturers are also moving into adult-oriented items, including a new perfume, Bridge, as a tie-in to the movie "The Bridges of Madison County."
It's too soon to say whether such products will generate the kind of loyalty and sales that children's products do.
If all this speculation was tiring to the participants at Licensing '95, they could take a rest on one successful adult-oriented product extension: a "Forrest Gump" park bench.