Posted by mike on 2006/8/14 10:29:38 (954) reads
Autoweek.com has an article about car companies licensing thier vehicles' to other products and how it is often adding considerably to the bottom line.
General Motors lost $3.2 billion globally in the second quarter. Last year, GM-brand licensed products in the United States sold nearly as much.
Of course, it's licensees and retailers who take much of that, but as cash-strapped auto marketers scour for ways to make profit numbers, revenue from key rings, T-shirts and other licensed goods is regarded as a golden goose that can extend brands and bring in hundreds of millions of dollars at little cost.
Since 2004 the Chrysler brand, which has 200 licensed products from some 50 licensees, has beefed up its licensing revenue 40 percent, Bockborn said. Jeep now has 600 products and 150 licensees and its licensing revenue has risen by 20 percent in the past two years. Dodge, with 400 products and 100 licensees, saw its royalty revenue jump 20 percent in the period, he said.
The downside is brand dissatisfaction if kids have a bad experience with the products. Seltzer said his kids were very upset when the battery on their Jeep Ride On died. They "hated Jeep for the three weeks it took to get a new battery" online, he said. "However, now it's running, and they love the brand again."
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Posted: 2006/8/14 13:54 Updated: 2006/8/14 13:54
Quite a regular
Re: Jeep Licensing Rises
Downside for Jeep-branded products maybe. I feel sorry for all the people who bought the POS Jeep backpacks from a few years ago. I bought one when I started college and it lasted just long enough for the return period to expire (30 days). I returned it under warranty and the new one lasted about as long so I just went out and bought an Eastpak that I still have today. Years later, it made me hesitant to buy our Jeep-branded stroller. However, I had absolutely no hesitation buying our Jeep Cherokee or later our Jeep Commander based on the quality of a backpack.