Last week it was announced that CAA Brand Management has reached an agreement to acquire Beanstalk, and with Warner Bros. Discovery being circled by potential buyers like Netflix, Paramount and Comcast, we could well see fewer, and bigger, players in the licensing space.
There is understandably concern what this might mean for both role elimination perspective, and how many brands can remain as 'priorities' for these newly merged companies. How serious are these concerns and could there be any potential upsides?
Consolidation across licensing, particularly through media companies is nothing new, Disney acquired LucasFilm, Marvel and Fox; Paramount bought the rights to the Teenage Mutant Ninja Turtles and Garfield; and Netflix purchased the Roald Dahl estate. Not all of these led to large job losses or the deprioritization of brands. Star Wars and Marvel saw licensed product sales increase, through the investment in new content for both. That's not to say that the number of brands being managed by the Disney Consumer Products team didn't increase massively, and there were undoubtedly some brands that ended up getting less, or no, attention.
The merger of Beanstalk and CAA sees the creation of a powerhouse of licensing, representing brands across numerous categories. In food and beverage they now represent Kellogs, Coca-Cola, Diageo, Oreo and Pringles. In automotive F1, Audi, Bugatti, Volkswagen, Volvo , Ford, McLaren and Bentley. And in entertainment, X-box, Minecraft, Miffy, Bob Marley & Dr. Seuss. If the combined company does make large numbers of job cuts then yes we cannot doubt that the amount of time each brand receives will decrease. However if the deal was done, not with an eye on perceived efficiencies and cost savings, but on the huge potential for cross over, collaboration and increased opportunities, then it's not necessarily a bad thing for the industry. Also most of these brands are not fully owned so the newly combined agency will still have clients to report back to and targets to hit on individual brands and portfolios.
Imagine some of the collaborations and crossovers that may now be much more easily possible through internal conversations, the opportunities for learning across newly merged teams and the greater opportunities at retail.
Warner Bros. Discovery being purchased by another studio potentially raises more concerns due to the wide and deep portfolios of fully-owned film and TV content and IP which will then need representation. It would not be impossible to manage them all, based on their potential with large, well organised teams. However we have often seen licensing teams decimated by mergers.
However there is also potential for lower priority titles being given to licensing agencies to manage - as many large licensors already do. Also the Negosh platform is perfectly placed to help over-stretched licensing teams to manage their portfolios more efficiently, saving time and resource. From gap-filling specific product category or geographical opportunities, to opening up to all possible opportunities the platform can be used in any way that best suits individual needs.
Rather than assume the worst and doomsaying we should be hopeful that these mergers are happening, not only to create operational efficiencies but also, to open up new opportunities. Licensing sales are continuing to increase through innovation and creativity, with smaller and older IPs creating great product offerings for smaller but heavily invested fans.
These things are often cyclical and brands are always 'rediscovered' and given back the attention they deserve. Either way the industry has weathered such storms before and survived, continuing to grow and innovate. Licensing is so often based on confidence and the wider industry should be more confident that these mergers will shake out positively.