The market conditions in 2009 have been unprecedented for the licensing community. Following significant retailers leaving the High Street last year, it’s fair to say we’ve sailed into uncharted waters. It’s been a year of learning and operating differently. Yes - there have been plenty of challenges but this has led us to working even closer with partners, being even more tactical in our planning and embracing opportunities as they present themselves. In the long-term this will have positive repercussions for the market.

One of the most significant events was the closure of Woolworths, an important retailer for the licensing community and one extremely strong in pulling together our cross-category display. The gap left is taking a while to fill. Plus there were issues surrounding where stock would be disposed and the resulting sell-off allowed customers to stock up on cheap products which had a knock on effect on the market in the early months of 09.

A big question remains; where has consumer spend gone? The closure of Woolworths, at least temporarily, has shrunk the UK licensed product market. We’re adapting our focus to meet these challenges and working with retailers who are examining how they can effectively tackle the cross category opportunity and win back those customers.

Other challenges included FOB costs. Fluctuations with the dollar early in the year have made it difficult to cost and manage an FOB business.

In general, we’ve yet to see the full impact of these issues and the general market conditions. Christmas is on the horizon, which will tell the next chapter of the story.

Retailers are leaving decisions until later in the year, which is understandable because they are awaiting decisions regarding pricing and discounting from their suppliers.

At Nickelodeon we’re working closer than ever with retailers to secure big wins wherever possible. It is of increasing importance to use the power of the channel to help execute promotions and drive customers to retail partners. The great thing at Nickelodeon is having access to all departments and being able to form cohesive strategies that include on air, consumer and commercial marketing and PR. This also creates a rewarding and empowering environment for our team.

The licensing industry does have the opportunity to be entrepreneurial in its activity, developing ideas and making things happen. Part of this is pushing properties into new areas and developing new product ranges, but also leveraging all our assets and implementing new promotional ideas using the power of the channel brands.

2009 is Year of the Sponge; and all areas of the business have come together to form a strategy and tactical plan to support SpongeBob SquarePant’s tenth anniversary. This has really paid off (in terms of uplift in sales and additional support for consumer product development) with a diverse range being built up across electronics, toys and accessories and fashion areas. SpongeBob successes include quirky products such as SpongeBob lego, development of a master toy range, extremely effective on air competitions and promotions, retail promotions, innovative advertising on London buses and a one-off appearance in fashion bible – ID Magazine. Plus we’ve taken SpongeBob on the road for our national shopping mall tours which has been a fantastic driver to key retailers who have wholeheartedly supported this initiative. For us, this is laying foundations for future growth in 2010.

The SpongeBob SquarePants Claire’s Accessories promotional activity is a great example of Sponge activity which really engages with our audience. Here we linked a channel piece directly to the promotion by offering winners the chance to appear on the channel and introduce an episode.
 
Other star performers for us include Dora the Explorer (who will be ten next year) and the Wonder Pets. Dora is very much an evergreen brand for Nickelodeon and next year promises to be an exciting one for her. Wonder Pets has really delivered for us at retail with characters whose popularity and appeal translate extremely well into sought-after toys and products.

Plus, looking forward, we are about to launch ranges for tween sensation iCarly and aspirational fantasy show H20 – Just Add Water. This is our first foray into live action teen product, which promises to be a really exciting and important development for Nickelodeon. Understanding the mindset of the tween and teen demographic is a delicate process. We need to ensure the product is aspirational and sufficiently glamorous for that audience. The great thing for us is having access to the stars of these shows which we plan to leverage accordingly. We know the characters really engage with their tween audiences and these audiences welcome the opportunity to see them in different guises.

Development of teen product definitely signifies a broadening of our brand portfolio and a creation of a more diverse product range. Diversity is very important as it enables us to offer retailers greater choice, focusing on customers groups who will undoubtedly vary from one retailer to the next. Our aspiration is to manage a number of properties that contain different facets that appeal to different age-groups. At Nickelodeon, we’re in a great position to use the power of our channels that connect with all age ranges. It gives our retail partners flexibility to work with us on product that they feel sits most comfortably within their business.

Increasingly we are more focused on licensing driven by experience (we touched upon the mall tour earlier). Events such as the SpongeBob SquarePants Bikini Bottom area at Camp Bestival and the SpongeBob/Dora show at Butlins allow children and families to immerse themselves in the character’s world. This is taken a stage further at the Nickelodeon Hotel in Florida where residents are literally living and breathing all things Nickelodeon. Theatre and entertainment are hugely important to our business moving forward and underpin a significant part of our product and retail commercial strategy.

At Nickelodeon, I am very proud of the category specialists we have in the business, who are focused on product development and retailer relationships. We maintain the constant dialogue with retailers, which is critical in terms of developing a strong commercial edge. We want to be creative and make fabulous products, but we also need them to perform brilliantly at retail and ensure the commercial success of all that we do.

Having worked in a number of organisations, I’ve experienced a range of business philosophies. I’m very comfortable in the Nickelodeon environment as it has a healthy balance between focusing on the work that needs to get done and being able to enjoy and celebrate what we do. It’s particularly important in today’s environment, as we should be given the opportunity to be entrepreneurial and creative. That is perhaps a reason why licensees and retailers like working with Nickelodeon. We listen. We understand. And, as a result, our commercial relationships strengthen and collectively we achieve.