Food Licensing Serves Up Deals

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Licensing grows in kid and adult categories

Any way you slice it, food licensing serves up many opportunities for licensors and licensees.

The category can help leverage a brand, provide a forum for new product introductions and offer co-branded partnerships.

For these reasons companies have extended their commitment to food, helping grow the licensed portion of the business to $12.4 billion, up 3% from last year.

New efforts abound, and not just in the kids arena, where licensing has been robust in such categories as juice, cookies and fruit snacks. Kellogg has come out of the box signing on Houston Harvest, Brach's and Aurora Foods to create products outside of its core cereal and snack food business. It also inherited the Sesame Street cookie brand as well as Famous Amos, Cheez-It, Carr's Crackers and Ready Crust via its March 2001 acquisition of Keebler.

Success has been sweet for M&M/Mars with sales of licensed merchandise hitting the $100 million mark in 2001, reports Michele Brown, VP licensing, M&M/Mars. Key growth areas: candy and merchandise, food and ingredients, and non-foods.

Food and ingredients is "burgeoning" says Brown. She notes the longstanding partnership with Pillsbury and new deals signed with Smucker's for a Three Musketeers dessert topping (due 4Q) and Edwards for a line of desserts (under development) for fast food and sit-down restaurants in 2002.

The holiday 2001 line debut of premium chocolate filled plush and ceramics from Galerie au Chocolat broadens M&M/MARS' distribution into specialty and department stores.

Distribution is growing for Viacom Consumer Products' Richard Scarry certified organic food line for children. The 27 skus are now in about 5,000 retail doors across the country, says Pam Newton, senior VP marketing and licensing, Viacom CP. Also in place: a small specialty and convenience store program for Mighty Mouse juices. Under consideration: a retail rollout of its Café Nervosa coffee line inspired by the TV series Frasier.

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