UGM June 2019 Q98
- Option : D
- Explanation : Licensing: Most manufacturers take years and spend millions to create their own brand names. However, some companies license
names or symbols previously created by other m an ufacturers, nam es of well-kn own celebrities, or characters from popular movies and books. For a fee, any of these can provide an instant and proven brand name.
Apparel and accessories sellers pay large royalties to adorn their products—from blouses to ties, and linens to luggage—with the names or initials of well-known fashion innovators such as Calvin Klein, Tommy Hilfiger, Gucci, or Armani. Sellers of children’s products attach an almost endless list of character names to clothing, toys, school supplies, linens, dolls, lunch boxes, cereals, and other items.
Licensed character names range from classics such as Sesame Street, Disney, Peanuts, Winnie the Pooh, the Muppets, Scooby Doo, and Dr. Seuss characters to the more recent Teletubbies, Pokemon, Powerpuff Girls, Rugrats, Blue’s Clues, and Harry Potter characters.
Almost half of all retail toy sales come from products based on television shows and movies such as Scooby Doo, SpongeBob SquarePants, The Rugrats Move, The Lion King, Batman, Star Trek, Star Wars, Spider- Man, Men in Black or Harry Potter.
The fastest-growing licensing category is corporate brand licensing, as more and more for-profit and not-for-profit organizations are licensing their names to generate additional revenues and brand recognition. Coca-Cola, for example, has some 320 licensees in 57 countries producing more than 10,000 products, ranging from baby clothes and boxer shorts to earrings, a Coca-Cola Barbie doll, and even a fishing lure shaped like a tiny Coke can. Last year, licensees sold more than $1 billion worth of licensed Coca-Cola products.
