Disney eyes licensed product growth in China

The Walt Disney Co, the world's largest licensor by retail sales, is rolling out a new cross-border strategy to facilitate brands in China to better land their Disney licensed products abroad, amid its continuous efforts to boost its franchised products to attract more young and family consumers.

According to License Global's Top Global Licensors Report 2023, the value of Disney's licensing business reached $61.7 billion last year, ranking No 1 globally.

Kermid Rahman, general manager and senior vice-president of consumer products for the Walt Disney Co China and South Korea, said at the annual consumer products showcase convention on Tuesday that the company has initiated a cross-board strategy in China, to help Chinese companies get more distribution and retail access overseas. At the same time, they are eyeing more international brands to expand their footprint in China.

The new strategy is being launched as more Chinese firms are gaining experience in product development, quality control and digitalization in recent years, and are becoming increasingly competitive in international markets, said Rahman.

Disney will assess the possibility of cross-border collaboration with its partners in terms of product development, distribution channels, integrated marketing capabilities, brand management, financial capacities and corporate values, said the general manager.

The consumer product unit's revenue in China has seen double-digit growth this fiscal year. Disney's e-commerce marketplace in China, shopDisney, is on the same pace, according to the company.

Some 800 million Frozen licensed products have been sold in China in the past decade. The World of Frozen, inspired by the animated film of the same title, will open to the public in Hong Kong Disneyland in November.

In addition to its cross-border strategy, Disney continues to innovate its products and strengthen connections with Chinese consumers via integrated marketing, to maintain growth momentum.

Disney China's creative teams develop more than 200 new product designs daily on average. Of them, around 80 percent will be realized into products, with idea materialization taking 12 to 18 months, said the company.

Apparel, toys, cosmetics and foods are the categories that have enjoyed the most rapid development in the past decade. Disney's licensed plush toys have grown 50 percent on average annually in the past three years.

Disney shares with its partners the market insights the company has observed about Generation Z — those born between the mid-1990s and early 2010s — and Gen Alpha — born after the 2010s. For instance, following the pet-loving trend among the Gen Z, Lucifer, the cat of Cinderella's stepmother, has been developed into a popular toy with a cool personality that young people adore.

"We will continue to grow our core brand and franchises through our combined efforts, and deepen our emotional connection with Chinese consumers by keeping ahead of new trends, tracking changing consumer performances and behaviors, and staying closer to what consumers need," said John Hsu, managing director of the Walt Disney Co China.