Top Game SWAG Merchandisers

So who has the best game merchandising program? In taking on the task of helping my friends at Fans.lu, I had to do some research into how game companies merchandise their intellectual property.  I was both surprised and a bit dismayed at what I discovered. First, lets talk about Rovio and their Angry Birds success.

Angry Birds was a massive winner as a game and even more so as a brand. What is truly mind boggling is how they've managed their IP and created over $200M in sales with their branded t-shirts, plushies and other imprinted merchandise. You would think this would be slowing down but with the launch of their Star Wars Angry Birds, it’s only growing. It’s expected that in 2012, Rovio achieved a whopping $500M in sales of which 40% will be attributed to merchandise (http://www.mobileworldlive.com/rovio-plans-to-increase-merchandise-revenue). And you’re thinking, ‘yay for Rovio’ right? The ugly fact is that only about 2% of the games out there actually provide merchandise for their games and that 2% is really only the biggest players. The rest of the developers who have equal to (or even better) IP, artwork and concepts don’t take advantage of the power of their hard won brand.  So the real question is who else is creating incremental revenue via their IP, how are they doing it and more importantly, how can you do it?

The List (for context)

• Rovio's Angry Birds: Everywhere! and here http://www.angrybirdstees.com/
• Valve: Hits like Portal and Team Fortress http://store.valvesoftware.com/
• EA: From Plants vs Zombies to Medal of Honor: http://gear.ea.com/apparel/t-shirts.html
• Ubisoft: Assassins Creed: http://store.ubiworkshop.com/
• Rockstar Games with massive hits like GTA and Max Payne: http://www.rockstarwarehouse.com/

All of the above publishers have great games, no arguments. What they’ve also done right is create some pretty amazing t-shirts, hats, action figurines and posters.  They’re also making them available in very simple online stores that take advantage of their social network power.

How to do it

To achieve even a small measure of success in creating a line of game merchandise you first need to answer a few questions:

1.  Do your players want merchandise? You need to understand your players and nobody knows them better than you. If you have a solid following on Facebook, if you have dedicated fans who wait for your game releases and if you have great IP,  chances are there is already a demand for your merchandise. If you’ve been to E3 or GDC and see how many t-shirts are consumed at those shows, you’ll understand what I mean.
2. What are your options for getting it set up? You can create your own merchandise by designing everything from scratch and setting up your own store using Volutions or BigCartel. This gives you 100% control and great profit margins but the real challenge is you need to get your t-shirts printed and you need to manage the shipping and customer support. This requires some serious capital outlay and is a massive pain in the butt if you’re only selling a couple hundred shirts a month. You could use the ubiquitous Cafepress which will print and ship everything for you but the quality & cost makes this a very un-scalable solution. Still, not a bad choice if you are only going to sell 10 shirts a month. And then there is the Fans.lu service: they set up the store, create and imprint the product, do this shipping and handle customer support.  They also don’t require a set-up fee and take their profit from the sales (low risk). If you’re looking to sell between 100 and 1,000 shirts, posters ect a month, this is your best bet.
3. And finally, how are you going to promote it? Building a store and getting some swanky shirts made up is only half of the solution. Once you’ve decided what you’re going to merchandise, you need to promote the hell out of it. Facebook, twitter and of course, your own website. Not only will this create incremental revenue for you, but it will also expand your brand beyond the game.

However you approach it, take advantage of your brand power and create incremental revenue through merchandise. Even if in the end it only generates only 5% extra revenue (and not Rovio’s 40%), you’re still going to come out ahead.

Full Disclosure: Chris Hennebery is a consultant working with Fans.lu

In the Quest for SWAG

The first company I started was a t-shirt business. Having a background in art helped a great deal because the biggest difference between good t-shirts and bad t-shirts was the artwork. My art-foo was good and theirs was bad, so I had an edge. I used my little t-shirt venture to grow another business that focused on event management. I played a lot of volleyball so I started my own league and pretty soon I had over 500 teams playing every week. I take a small bit of pride in the fact that I was able to leverage my t-shirt business to build my event management company through brand, swag and uber-cool prizes (I still see my Starbucks Volleyball shirt at the beach). To me, it seemed a very simple thing to leverage t-shirts to promote a brand.

 So I find it a bit frustrating that in the games business, 98% of companies are not taking advantage of this. So many great games and so few cool t-shirts. And yet when you go to E3 or GDC, there are hundreds of gamer-shirts. Yes, companies like Jinx and Play.com do some brisk business and the marketing companies helping the publishers also have no problem creating the swag. What I don't get is why these publishers and developers don't push more merchandise to create incremental revenue. You would think everybody would be all over pumping out plushies, bobble-heads and t-shirts after Rovio's success with Angry Birds. But very few are. You could imagine how happy I was to find out about Fans.lu. This company has created a turn-key solution that allows games developers/publishers to launch a store to sell merchandise based on their IP. Fans.lu build the store, creates the products, manage the inventory and fulfill to the fanboys/girls with the publishers only having to provide the game imagery needed to create the product.

 But why is this important? So many great games and yet the profit margins continue to shrink. Now look at Rovio's Angry Birds again. In 2011 their revenues were up 963% to $106M and of that 30% came from t-shirts, plushies ect*. That is over $30M from merchandise alone and Rovio is projecting 50% of their revenue will come from merch in 2013. Ok, so you're not a Rovio and your side-scroller isn't Angry Birds but even so, chances are you are leaving money on the table by not offering a t-shirt to your players. Even using the worst case scenario where 1/500 players will buy a shirt or poster from you, you could be talking about a boost in revenues of 3-5%. And if you do have a great fan-base then its more likely to be 1/25 that are interested. That could be a lot of incremental revenue that might mean the difference between your little game being solvent and you having to sell a kidney to make payroll.


Full Disclosure: I'm helping out at Fans.lu which is in the business of helping game developers create merchandise for their IP. Let me know if you'd like more info.

~chris hennebery


*Kathleen De Vere, May 7th, 2012 http://www.insidemobileapps.com/2012/05/07/rovios-revenues-jump-963-year-on-year-to-106-3m-in-2011/