Sector watch: Collegiate

Posted by Marty Brochstein on October 01, 2012

Companies in the business of licensing collegiate logos and trademarks are increasingly trying to identify underserved niches in order to continue to grow this significant sector of the licensing business.

According to results of LIMA’s Annual Licensing Business Survey, collegiate licensing generated $203 million in licensing royalty revenues in the U.S./Canada in 2011, up 3.6% from the $196 million generated in 2010. That translates into an estimated $3.77 billion at retail, up from $3.64 billion in 2010. The royalties generated in this sector represent 3.8% of overall licensing royalties in 2011, which results of the LIMA survey peg at $5.3 billion.

As has been the case in the past, apparel and fashion accessories account for the largest part of the collegiate business – 65% of total retail sales, according to results of the LIMA survey. The apparel segment that’s showing the most movement is the women’s category. “Women’s continues to be a big growth category in college, “says Cory Moss, SVP and Managing Director, The Collegiate Licensing Company (CLC). “There are more than 78 million female fans of college sports in the U. S., and licensees are now tailoring more products to fit women of all ages. “

It can be a tricky market segment to supply, notes Rick Van Brimmer of The Ohio State University. Women’s apparel specialty stores – a necessary component of reaching major swaths of the women’s market, may give solid initial orders for back-to-school/start of the football season, but often are loathe to restock until Holiday, no matter how well sales have gone earlier.

On the non-apparel side, Van Brimmer says that party/tailgating goods segment continues to show solid growth and product creativity. CLC’s Moss, more generally, says that “housewares, home furnishings, and domestics are experiencing huge growth as the 173 million college fans integrate their favorite school into their total lifestyle more and more.”

In line with that, respondents to the LIMA survey note that distribution of collegiate goods has been growing to include convenience, drug, and home retail chains, often giving an opportunity for new products that may not have a homer in more traditional venues such as mass merchandise outlets, collegiate bookstores and sporting goods retailers.

Another major category in the collegiate market is videogames, led by NCAA football and basketball games published by Electronic Arts. Moss says that royalties from videogames grew more than 13% in 2011. The LIMA survey estimates that royalties from videogames account for 12% of the collegiate market.