Every January, Hong Kong presents a massive combination of trade events over three days. The events focus on licensing and merchandising, around which there’s no shortage of opportunity for entertainment brands.
In January 2016 the Asian Licensing Conference (ALC), Hong Kong International Licensing Show (HKILS), Toy & Games Fair, and related events the Baby Products Fair and International Stationery Fair, drew 2,900 exhibitors and over 100,000 buyers. The 2017 shows are tracking to be larger.
Asia’s remarkable economic growth in recent years has created a massive consumer base for licensed goods, while the huge manufacturing base in the region continues to feed that demand. That’s reflected in the numbers participating in the events in Hong Kong. The HKILS has doubled its number of exhibitors in the last five years.
Australian companies have been doing business at the event for several years, with the number of entertainment brands increasing recently. The second-highest iOS game of all time, Halfbrick’s Fruit Ninja, has been doing merchandising deals at HKILS for a few years, and is now on the way to a movie adaptation. Kids entertainment brands Hi-5 and The Wiggles were both very prominent at the January 2016 events.
Those early childhood-focused brands were a very timely fit, as the events came hot on the heels of announcements by the mainland Chinese government that it would relax its one-child population management policy to a two-child policy. Bad news for Durex but very good news for an awful lot of creators, licensors and licensees of early childhood brands.
The lower age-range of that suddenly expanding market will start walking during 2017, which means sufficient motor skills to have fun on a tablet – not that you should trust an 18-month old with an iPad.
There’s no shortage of digital entertainment targeting the age group, including Pukeko Pictures’ non-verbal the WotWots (China-specific episodes of which were created a year or two ago).
A major focus of the Asian Licensing Conference in January 2017 will be exploring the challenges and opportunities facing the licensing and merchandising businesses as more and more goods and services are traded – legally or otherwise – online.
The games industry has adapted well to the digital age, developing effective business models, unlike the film, music and TV industries. In the West much of that successful adaptation has been thanks to the App Store.
Despite having generally poorer internet capacity in China, Chinese giants including QQ/TenCent were well ahead of Apple in developing in-game micro-purchase business models for mobile games. (Consoles such as PlayStation and Xbox weren’t allowed in China at that time.) It was no mean feat in a country where very few people had credit cards, but phone-based micro-transaction systems were running in Asian markets, especially China and India, years before the App Store opened its doors. The freemium model has become the dominant model internationally for mobile games.
At ALC 2017 two panel sessions are devoted to online activity: ‘Brand Licensing in the Digital Era’ and ‘Digital Transformation of Licensing’. Speakers from major digital entertainment and gaming brands including Rovio, Viacom (MTV, Nickelodeon) and YouTube will discuss the shift toward gamification and digitisation, and strategies that bridge the gaps between virtual and physical marketplaces.
Nickelodeon, Sanrio, 20th Century Fox and Warner Brothers (pictured, top) – all of whom have both video and game-related properties in their portfolios – are among the global entertainment licensors participating at HKILS 2017.
China is expected to become the world’s largest box office take for film releases in a couple of years, and is already the largest market for online shopping – including entertainment product. At a mainland China-focused session, entertainment, broadcasting, game-producing and e-commerce players will discuss opportunities to grow entertainment brands on the mainland.
ALC and HKILS have long had high levels of participation from regional animation companies, especially those promoting game or TV properties with toy merchandising deals or potential.
Among those are three with very active animation industries: Malaysia, Singapore and Thailand, each supported by a government agency at the events in Hong Kong. All three countries were represented at the recent Asian Animation Summit in Brisbane, as was NZ, with Cirkus presenting its recent NZ Web Fest awardee, Jack of All Trades, and several other companies including POW in attendance.
Kids TV showNori: Roller Coaster Boy, POW’s animation co-production with Korea’s XrisP (pronounced Chris P), will be at HKILS this year. As POW CEO John McKay told Crewed recently, there’s a substantial toy and merchandising line planned to capitalise on the show, which starts to roll out episodes early in the new year.
ALC also offers some practical workshop sessions on licensing best practice, and handling legal requirements and IP in different territories around the Asia-Pacific region.
Grinding Gear Games, creators of Path of Exile, teamed with Chinese entertainment giant TenCent earlier this year to take PoE into China. Grinding Gear has been slow to explore merchandising beyond in-game purchasing, although a push into a market as large as China would make it much more viable.