Global Edition: Dissecting Fashion’s Love Affair With Gaming
Plus: Three cautionary brand licensing tales, China drags watchmakers into the future, and our TikTok Take.
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For many of us, social media has turned our virtual selves into the protagonists of our lives, and this practice has only deepened as online interaction became the predominant method of communication over the past year due to the coronavirus pandemic. Whether through Instagram, TikTok, Twitter, or WeChat, the world has grown accustomed to seeing people presented virtually, and therefore fashion — an industry built upon personalization and expressions of individuality through style — has naturally moved further into exploring digital realms, including the force that is gaming.
The gaming industry is projected to be worth $257 billion by 2025, representing a more than 30% increase since 2017, with the meteoric rise of casual gamers playing on their mobile phones adding to the industry’s momentum. According to Newzoo, 42% of gamers are millennials (age 23 to 28), with Gen Z coming in second at 20% of the total. Both of these demographics are the main drivers of China’s luxury goods market, while in the United States they represent $350 billion in spending power, according to McKinsey & Co. So it’s not surprising that fashion got the gaming bug.
But this is not a new fling, rather it is a long-term love affair that has been brewing for years. Characters from Final Fantasy were featured in a 2012 Prada campaign, as well as ads for Louis Vuitton in 2016, while Moschino had an in-depth collaboration The Sims in 2019, creating an in-game and matching real-life capsule collections. Over the past year or so, luxury-gaming collaborations have become all the rage: Burberry recently announced a deal with Tencent Games’ Honor of Kings, Fortnite characters can now wear Nike’s iconic Air Jordan sneakers, and players of Nintendo’s Animal Crossing (arguably the fashion industry’s favorite game) can enjoy dressing up in styles from Valentino, Marc Jacobs, GCDS, Sandy Liang, MCM, Gentle Monster, and Net-a-Porter.
Pokémon Go recently made its first foray into high fashion by partnering with the new and much-hyped Gucci x North Face collaboration, with looks from the collection now available for players’ avatars. JTGily, a Pokémon Go creator and YouTuber with more than 200,000 followers, told CCI that he was pleasantly surprised by the pairing: “Honestly, I would have never expected a Pokémon Go x Gucci collaboration, but Pokémon Go does have in-game avatars that you can customize, so why not? I made sure to grab those new clothing items right away and threw them on my avatar.”
Skins, or cosmetic add-ons, earn the gaming industry an estimated $40 billion a year, according to online marketplace DMarket. Designer brands can help drive spending, granting just about anyone low-cost access to the luxury industry through their avatars. “Fashion in and outside of gaming is a great way to express yourself and your unique style,” says JTGily.
In both fashion and gaming, we adopt the role of a character, and the two industries also share deep roots in escapism. Fashion brands want to be involved in the mesmerizing, addictive popularity of games by entering them strategically and becoming part of their immersive experiences, rather than merely inserting disruptive in-game adverts. It’s a five-star marketing strategy.
Darang Candra, director of Southeast Asia for gaming research firm Niko Partners, believes that in-game fashion can equate to real-world sales. “Games can become a medium of advertising just like TV or social media,” he said. “The ability to cater to the trends and behaviors of the gaming community is the most essential part in ensuring whether the in-game fashion marketing efforts would succeed or not.”
Candra noted that promoting products aimed at youth is the most successful form of marketing to gamers. In this regard, the Gucci x North Face collaboration could be counted on as a successful opportunity for fashion integration for Pokémon Go since it was a streetwear drop, made for an audience of Gen Z and millennial hypebeasts.
Millions of young people also watch their favorite gamers via video platforms, powering the mainstream popularity of gaming. Swedish YouTuber PewDiePie started streaming himself playing games in 2010 and now has 108 million subscribers, making him the second most-followed creator on the global platform.
Gamers have also become some of the world’s most famous influencers. In 2019, Louis Vuitton reached out to League of Legends tournament organizers to dress the players and design a luxury trophy case, eventually releasing a capsule collection in partnership with Riot Games, all because they wanted to be associated with the skyrocketing cultural popularity of games and their players.
“Both gaming and luxury fashion both intersect in serving the lifestyle needs of the middle- and upper-class segments of the population,” said Candra. “Both can serve as a status symbol of sorts and provide happiness to the users. Furthermore, gaming, especially console and PC gaming, mostly target the well-off segment of the population which are also more likely to buy luxury fashion products.”
These two prosperous industries are joining forces to create an expansive future of marketing opportunities fueled by the internet culture of influence and streaming. And as society progressively moves into the digital sphere, we can expect to see more industries tapping into the limitless universe of gaming, injecting their brands with futuristic fantasy and seizing the attention of young consumers.
- by Sadie Bargeron
Mentioned in today’s newsletter: Gentle Monster, Gucci, IWC, Instagram, Louis Vuitton, MCM, Marc Jacobs, Montblanc, Moschino, Net-a-Porter, Nike, Nintendo, North Face, Piaget, Pierre Cardin, Riot Games, Sandy Liang, TikTok, Twitter, Valentino, WeChat.
CollaBrands: Three Cautionary Tales of Distressed Brands and How to Avoid Them
by Steven Ekstract
Pierre Cardin
With the recent passing of legendary designer Pierre Cardin, it is worth exploring how he tainted his eponymous brand name by over-licensing into too many different product categories and failing to maintain quality control and distribution rights. As a young man, Cardin was the darling of the Paris fashion world. For 35 years, from just after World War II until the early 1980s (when he began licensing), Cardin was one of the world’s top fashion designers. According to Cardin, his goal in doing so much licensing was to fund an escape from the fashion world and expand his business into areas that interested him, notably Parisian real estate and restaurants.
While accomplishing this, he licensed the Pierre Cardin brand for a range of products, from luggage, and fragrances to key chains and pencil holders, and just about everything in between, granting licenses to the highest bidders without regard for the quality of products. At the height of activity in the mid-1990s, the brand had more than 900 licenses and was selling $1.2 billion a year at retail. Pierre Cardin became enormously wealthy from the royalties while distressing his brand name. A decade ago, in 2011, when Cardin attempted to sell the brand for $1 billion, he was unable to find any buyers. When a brand’s primary goal for licensing is financial gain, the brand will always lose out.
JoJo No-No: JoJo’s Juice Board Game Turns Sour
JoJo Siwa is a YouTube influencer who started out as a competitor on the TV show “Dance Moms” when she was ten years old. JoJo soon became a YouTube star with her own channels, releasing hit songs geared to young girls and wearing her trademark large colorful hair bows, which she merchandised through a brand collaboration with the accessory store chain Claire’s. At 13, JoJo signed a multi-million-dollar TV and consumer product licensing deal with the children’s cable network Nickelodeon. In addition to producing several JoJo TV shows, Nickelodeon has licensed hundreds of JoJo products such as toys, apparel, accessories, and even bedding. JoJo’s licensed merch has been hugely popular among young girls and Nickelodeon has turned her into a billion-dollar brand.
So last week, JoJo fans were taken aback by a scandal involving a newly released JoJo Siwa-Nickelodeon board game called “JoJo’s Juice” aimed at girls six years and up. The game has created serious parental backlash based on some of the inappropriate questions in the "Truth or Dare" category of the game, such as "Have you ever gone outside without underwear?" and "Have you ever been arrested?” Others included "Have you ever stolen from a store?" and "Have you ever walked in on someone naked?"
It immediately became apparent that JoJo Siwa had not seen the questions for the game ahead of time. In the business of brand collaborations, this is tantamount to Dorothy pulling back the curtain to reveal the Wizard of Oz as just a frail old man. Lesson one of licensing: The product or experience needs to stay true to the brand. Product approvals must be strictly adhered to.
JoJo quickly disavowed knowledge of the inappropriate questions and had the products removed from the market. How much damage this has done to JoJo’s brand remains to be seen, but swift action on the part of both JoJo and Nickelodeon will likely limit the fallout.
Trump Brand Hits a Bump and Crashes
A great deal can be said about Donald Trump, but we need to acknowledge that for 40 years he quite cleverly built the Trump brand as a symbol of wealth, luxury, and power. In the process, Trump realized that his name could translate into all forms of licensing, from real estate to vodka, even to an ill-fated Trump University. His daughter Ivanka managed to capitalize on the brand equity of the family name, creating a fashion line for young women that famously hit the skids when it was discovered that the products were made in China.
In addition to Ivanka’s failed label, many of the Donald’s licensing ventures also fizzled out, such as Trump Steaks and Trump Vodka (he does not drink alcohol), while others brought serious legal troubles, like his Trump University. However, one licensed business that was a big success was his line of apparel. Between 2004 to 2015, Trump’s line of licensed menswear, sold exclusively at Macy’s department stores in the United States, was, for several years, the top-selling brand of men’s business wear in the country.
A New York Times article from November 2005, entitled “Is This the Most Trusted Man in Fashion?”, cited a Brand Keys research study that found Donald J. Trump had beaten out Giorgio Armani and Donna Karan as one of the most trusted fashion names in America. That’s right: Donald Trump, the real estate mogul, television star, hair aesthete, and self-confessed “germ freak.”
Trump had nothing to do with the design or manufacturing of the apparel; in fact, he continued to wear his famed and oft-mentioned Brioni suits, even after the Trump brand of business attire came onto the market. What made the apparel line so successful? Trump’s success as a businessman translated into an emotional connection that consumers made with the affordable apparel line. Wearing Trump was sure to bring them success as well.
While Cardin traded and distressed his valuable brand equity for money, Trump traded his brand equity for power. Unlike Cardin, who lived a long and storied life as a fabulously wealthy man, Trump has lost a great deal of his power and brand equity in recent days by encouraging his followers to storm the U.S. Capitol. One wonders just how the Trump brand will fare when he leaves the White House?
JoJo Siwa, on the other hand, has the greatest opportunity for brand recovery as she quickly apologized for the inappropriate game questions and was able to have Nickelodeon pull the games off the market. Consumers will forgive brands if they feel they are honest and authentic.
Lessons Learned: Stay True to Your Brand
These examples provide three valuable lessons for brands considering licensed collaborations. First, in collaborations and licensing, the products and experiences that are licensed need to be natural extensions of a brand’s core IP. Second, it is necessary for the brand licensor to closely monitor the end products for quality control. And lastly, remember that brand collaboration licensing is first and foremost a marketing tool for building greater brand awareness and developing new brand fans. Royalty revenue alone should not dictate the deal.
Steven Ekstract is Managing Director of Global Licensing Advisors, a consultancy that provides companies with insight and strategic direction to succeed in the $300 billion a year licensing business. Ekstract is the founder and former Publisher of License Global magazine, the leading information source for the consumer licensing business. He can be reached at Steven@globallicensingadvisors.com.
Webinar: How Collaborations Are Defining Experiences in China
China’s Gen Z and millennial consumers seek novel products that stand out from the crowd, fueling a rapidly evolving culture of innovative “mega-collaborations” between brands.
Register today to join the Jing Group on Tuesday, January 26 at 10 a.m. EST / 3 p.m. GMT for a live webinar exploring “How Collaborations Are Defining Experiences in China”.
During the hour-long broadcast, presented by cross-cultural agency TONG, we’ll discuss why—from a consumer standpoint—brand collaborations continue to resonate and accelerate in China, and the value for all parties involved, including brands in and out of China collaborating together.
Now the World’s Top Swiss Watch Market, China Forces Watchmakers Into the Future
by Avery Booker
As observers of the global luxury market have long known, mainland Chinese consumers are a driving force in the Swiss watch industry, fueling crucial revenue in China as well as worldwide. But the Covid-19 pandemic brought with it a key milestone in China’s position in the luxury watch market, with the country officially claiming the title of the largest single market for Swiss watches in 2020.
According to the New York Times, Chinese consumers — denied the international shopping trips that previously accounted for an estimated 70% of their luxury spending — made the vast majority of their Swiss watch purchases last year within mainland China, a development with major long-term implications. Recent figures from the Federation of the Swiss Watch Industry reported $2.39 billion in Swiss watch exports to the Chinese mainland between January and November 2020, a year-on-year increase of 17%. This growth is even more impressive when compared to every other country and territory in the global top 20 luxury watch markets, all of which saw double-digit declines in Swiss watch imports.
The speed with which mainland China overtook other markets such as the previously dominant Hong Kong, Europe, and North America sent Swiss watch brands — many of which had stubbornly resisted digitalization — scrambling to adjust. This naturally benefited Chinese e-commerce platforms like Tmall Luxury Pavilion, which saw Richemont brands Montblanc, IWC, and Piaget launch official stores (and was no doubt instrumental in Richemont’s decision to invest in a China joint venture with Alibaba, Artémis, and Farfetch.)
Other watchmakers rushed to catch up on social platforms like WeChat, where Omega started offering payment functionality and direct-to-consumer (DTC) sales to cater to housebound consumers. Unfortunately, lost in the mix were the small and independent watchmakers who depended heavily on Chinese tourist purchases within Switzerland and throughout Europe, who were unable to invest in mainland China expansion (digital or otherwise).
Read the full article on Content Commerce Insider
TikTok Take
Default privacy for younger users. TikTok announced that it will by default set all accounts registered to users under the age of 16 as private, requiring them to approve any followers, and restricting interactions with the broader public for young users. TikTok has come under fire for how it handles young user accounts in the past, including recent legal action in the United Kingdom initiated by a 12-year-old girl.
Noah Beck lands a TV show. The popular 19-year-old TikToker, who has 24 million followers, landed a reality TV deal with Viacom-owned digital studio Awesomeness. The six-episode series will follow Beck as leaves behind his goal of a soccer career to try to make it as an influencer in Los Angeles, and will feature special guests to help him on his way.
Music industry impact. The Ringer breaks down TikTok’s outsize influence on how music was made and marketed in 2020: “A world where TikTok dictates what music gets heard, plus how and when it gets heard, has already changed the lives of many artists.”
Turning the tables on Trump: TikTok joined the wave of social media platforms that have banned the U.S. president following his incitement of rioters in Washington D.C. earlier this month, removing videos of his speeches and blocking hashtags such as #stopthesteal. The move came months after Trump said TikTok would be banned from the U.S. market.
Day trading in 15 seconds? The Wall Street Journal reports that platforms such as “TikTok, Twitter, YouTube, Reddit, Instagram, Facebook, and messaging platform Discord have become the new Wall Street trading desks,” where users share their investment wins and losses in real time.
Global News
Celebrities from Kasey Musgraves to Megan Thee Stallion are transforming merchandising from concert t-shirts into a range of products for the stay-at-home lifestyle, such as blankets, candles, and pajamas. New York Times
Merch fail: McDonald’s cancelled the release of its J Balvin line of products to accompany its meal deal with the singer, which was a follow-up to the hugely successful Travis Scott food and merch collaboration last summer. Business Insider
Is Instagram over? From slowing growth to its cliched aesthetic, ten reasons why the most popular selfie app is on the decline. Medium
Walmart plans to launch a fintech startup in a partnership with investment firm Ribbit Capital, a backer of the stock-trading app Robinhood. CNBC
For the American marketing extravaganza that is the Super Bowl, Pepsi is moving away from the traditional 30-second ad spot to focus its branding efforts on the championship game’s halftime show, which this year will star The Weeknd. Variety
Pepsi is also betting on TikTok rival Triller as a stronger platform for branded entertainment such as its hip-hop talent competition “Your Wildest Dreams.” Digiday
And in Asia, the soft-drink giant named K-Pop supergroup Blackpink as its new brand ambassadors for the region. The Drum
Lexus partnered with Twitch streamer Fuslie to design a customized “gamer” version of its 2021 IS sedan with input from viewers during a two-hour livestream. Marketing Dive
How companies are distancing themselves from the Trump brand in the aftermath of the deadly rioting at the U.S. Capitol. New York Times
Olympic dreams: Despite the worsening global coronavirus crisis and a shift in public opinion, Japan insists that cancellation of the Tokyo Games is not an option. Time
From shoppable content to educational programming, ten key trends for video in 2021. Social Media Today
