Merchandise deals rise in India, but market stays tough

Exposure to gaming, global OTT content, with genres like anime, has spotlighted licensed merchandise possibilities. Today anime communities and clubs are exploding and merchandise targets people up to 35 years

MUMBAI: For Nikki Thakker, founder of Entisi Chocolatier, collaborating with Warner Bros Discovery Consumer Products to launch licensed Harry Potter inspired premium chocolates was a first in the brand’s nine-year journey. And it proved to be one which she isn’t regretting. On Harry Potter’s birthday on July 31, Entisi launched a collection of Bertie Botts, Frogs, Hogwarts House and Hogwarts Express chocolates in its boutiques in Mumbai and Pune, on its website and on quick commerce platforms Blinkit and Instamart. Over that July weekend, Entisi Chocolatier did business worth ₹3 crore.

Merchandise deals rise in India, but market stays tough

“Harry Potter is premium IP and the books and the movies have references to chocolates which fits perfectly with our boutique brand,” Thakker said. “Harry Potter’s appeal cuts across ages: Those who grew up with J K Rowling’s books are buying nostalgia and children are discovering this world,” she said. The IP introduced Entisi to a much larger audience who may not have otherwise discovered the brand.

Spider-Man fans in India, meanwhile, could pick the Marvel character’s merchandise from among 26 brands that Disney Consumer Products signed deals with when its latest film released on July 30. Brands like Bata, Bewakoof, Pantaloons, Flipkart, Miniso, Hamleys, ITC Sunfeast and Pidilite etc. rolled out the superhero merchandise. Last week, brand licensing company Black White Orange (BWO) became a licensing agent in India for Angry Birds, the global entertainment franchise that became bigger than a mobile game. With The Angry Birds Movie 3 set to release in January 2027, BWO saw a strong opportunity to expand the brand through consumer products and promotional licensing programmes, said Mitali Desai, co-founder & COO at Black White Orange.

BWO represents both national and international brands like Universal Studios, Playboy, Netflix, Crunchyroll and Baahubali among others.

“Millennials grew up with the Angry Birds game but we will have to reinvent it for other segments. We’ve done significant collaborations with companies like Mondelez, ITC, Perfetti earlier and will look for partners in apparel, accessories, footwear, toys and collectibles. The idea is to have meaningful associations and not slap the licensed brand on every product,” Desai said. In the past 11 years, BWO has collaborated for web series Suits with Ballantine’s whiskey, Squid Games with Good Flippin’ Burgers, Minions and Monsters with Cadbury cakes and cookies.

Desai said India’s brand licensing space is yet to evolve like Japan or the US. “There aren’t many licensing agencies here yet the competition is cut throat and change is palpable. Historically, licensed merchandise was viewed as children’s space. No longer. Exposure to gaming, global OTT content, with genres like anime, has spotlighted licensed merchandise possibilities. Today anime communities and clubs are exploding and merchandise targets people up to 35 years,” Desai said.

Thakker expects a surge in licensed merchandise as consumers become more experience driven. “Products aren’t just bought for their utility but to connect with fandom, for nostalgia, or some identity or memory they have. That creates brand licensing opportunities across food, fashion and beauty,” she said.

Jiggy George, the veteran in international brand licensing and merchandising business who founded Dream Theatre said what’s significantly shifted isn’t the size so much as the shape of the deals. “Look at Spider-Man itself: Sony still owns the film, Disney Consumer Products still owns the merchandise rights, a split that’s been in place since 2011. That structure hasn’t moved, but what has moved is how aggressively adjacent categories — luxury, gourmet, D2C — are now bidding for character rights,” George said.

He said quick-commerce platform Blinkit backed Harry Potter (chocolates) and the diverse range of products launched by Disney with Spider-Man. “The specialised drop of UNO and Comet shoes, a licensed collaboration that sold out in five minutes or the UNO range with Bestseller, the Hello Kitty shop-in-shops at Azorte -- these are recent launches that demonstrate a paradigm shift,” George said. Brand licensing is like a lease agreement involving an Intellectual Property, property owner, the licensor or property leaser and the licensee who obtains the license to use the property. Licensing spans popular characters, entertainment brands, celebrities or sports.

In the past, Dream Theatre has worked with brand licensing for Candy Crush, Fifa, Real Madrid, Dreamworks, Hello Kitty, Pokemon and Little Singham, among others. “We are focused on creative associations that lift the value of brand licensing for the consumer, whether it’s UNO X Comet, Aneeth Arora and her brand Pero X Hello Kitty a year ago, or Pokemon and Oreo. Our current push is around music IPs and artist merchandising monetisation — taking rock, metal, Pop and Indie catalogues, building direct-to-fan commerce around them, and extending that same playbook into animation and gaming properties,” George said.

India’s licensed consumer products business is estimated at $2 billion, George said, adding that characters and entertainment side is outpacing sports right now.

The bigger roadblocks to this business, however, are fragmented retail and a massive counterfeit/unlicensed market that undercuts genuine licensees on price, George said. “Unlike the West, the older generation still doesn’t associate fan love/pride with wearing original products. Check any IPL match and you will find one in three audiences sporting a fake jersey,” he said.

“Though consumer price sensitivity makes premium-priced official merchandise a hard sell against cheaper knockoffs, the young Gen Z audience offers some hope,” George said.

Other challenges include thin margins for licensors, limited category depth and underdeveloped D2C and e-commerce infrastructure for licensed goods outside the metro markets, he said.

But quick-commerce is expected to boost licensing revenues. “I have always said that India has the fandom, the population base, and now the D2C rails. Stronger anti-counterfeiting enforcement is needed to shift retail availability of legitimate products,” George said.