Amazon unveiled a new platform at the Las Vegas Licensing Expo that will allow licensors to develop and launch products faster than ever before.
At the Keynote session at Licensing Expo, Amazon launched ‘Merch Collab’ by Amazon, bringing together brands and a group of about 150 artists to produce licensed apparel and other products.
Merch Collab is a new licensing program where brands collaborate with qualified designers and manufacturers to create the world’s largest selection of branded merchandise for fans and followers. Brands simply approve and promote products and Amazon tracks sales and pays out royalties.
Nicholas Denissen, vice-president at Amazon, unveiled the new program during the opening keynote at the show, which runs from May 22-24.
The decision to launch Merch by Collab was largely tied to Amazon customers seeking a broad selection of products.
“The physical constraints of off-line retail can restrict the types of brands and the number of branded products consumers can purchase and ecommerce removes these constraints. The most successful brands online aren’t necessarily those on retail shelves,” Dennisen said.
For brand owners, the motivation behind joining Merch Collab is driven by the need to monetize the peak of a show’s popularity, said Veronica Hart of CBS, which launched with Merch Collab with “Star Trek”, “Twin Peaks” and “American Vandal.”
How does Merch Collab work?
The program, in development for about a year and in testing for six months with CBS Consumer Products, Cartoon Network, Hybrid Apparel and YouTube influencer Shane Dawson, is designed to speed the process of bringing licensed items to market and making them for sale through a brand’s Amazon storefront.
Within the portal, licensors can establish brand do’s and don’ts as well as creative guidelines for their brands.
Once a licensor’s guidelines are posted, the brand owner will start to receive product submissions from qualified designers.
After receiving of the submission, brand owners can ask for revisions, reject submissions or approve submissions in under 30 seconds.
Licensors will have complete control over what product goes live and may choose to take a live product down at any time.
After successful approval, the design will populate the brand’s Amazon store, where brand owners can also analyze data and see what sells.
Initially, the program will be open to a limited number of brands.
What does it really mean for the licensing industry?
The program promises to connect brands with pre-approved designers and manufacturers to produce and sell branded merchandise. Amazon tracks sales and pays royalties to both the brand and the designer.
“Based on what we’ve learned [at Amazon], we believe that the licensing industry can grow to $1 trillion in the next years. That’s four times the current growth rate, 15 percent year-over-year. We’re on the cusp of a huge revolution in customer behavior, and we believe this is achievable and we want to be part of making this happen,” said Nicholas Denissen, vice-president, Amazon.
The program will help entrepreneurs, designers and small businesses reach Amazon’s 300 million customers while also driving awareness and increasing speed to market.
Merch Collab is now accepting applications from brands, designers, and manufacturers.
The Merch Collab site’s explanatory information stated, “We are interested in all brand types, including major entertainment brands, musicians, consumer products, and social influencers. Note that social influencers must have a minimum of 100,000 followers.”
Merchandise, and Pricing Details…
Merchandise categories are primarily t-shirts, hoodies, sweatshirts “with other categories launching at a later date,” according to the Merch Collab website.
Amazon owns the copyright for all designs created through the Merch Collab program. However, brands can request to purchase the copyright of a design for a fee designated by Amazon of between $5,000 and $100,000.
Royalty fees are calculated, according to the site, “based on your product’s purchase price less Amazon’s costs and fees.”
Of the total royalty payment, two-thirds is paid to the brand and one-third to the designer.
Moreover, the new service will allow brand owns to test new IP and use sales data to help guide product distribution.