Family shows: How to maximise your merch

When it comes to balancing the books on touring entertainment shows, a solid merchandise strategy can make a significant difference. But it’s not just about the bottom line; the right products can build audience loyalty, elevate a brand’s status, and even work as a marketing tool.

Richard Lewis, managing director of the Limelight Group, which creates merch on behalf of licensees and live touring entertainment show adaptations (including Peppa Pig and Ben & Holly’s Little Kingdom, which he also produces through his company Fierylight), says: “A good merch strategy can contribute nicely to the bottom line. If we do a Peppa Pig tour and play to 300,000 people, we target an average spend of around £4.50 to £5.50 per head. That could be about £1.6m overall.”

Meanwhile, Paul Goldsmith, director of UK-based Event Merchandising, which has provided the merch for family-friendly live shows such as Paw Patrol and Hey Duggee, adds: “You could have anything from a small regional theatre doing £1 per head or you could make £20 per head on merch for a show by one of the big kids’ creator acts. What’s really important is that your talent is actively pushing your merch! If they are confident about selling the product, then the crowd will naturally want to buy it as part of the experience. Young kids know more about merch now than ever before. ‘Merch’ is terminology that their favourite YouTubers use all the time.”

However, with global conflicts contributing to increasing fuel prices, rising import costs due to Brexit, and more, Lewis is keen to stress that creating successful merch lines is a long and drawn-out process and will only succeed if not rushed.

“You’ve got cargo ships being attacked in the Red Sea, which might add four weeks onto shipping,” he explains. “Then there’s additional costs because of other global conflicts. When we brought in our Christmas stock last year, a 40ft container of merch – which usually costs $4,000 to bring in – cost us $14,000. There are so many market forces that might hit you at the moment, so you have to plan a long time in advance. If someone comes to me eight weeks before their show starts and asks me to do the merch, I turn them down: you might as well burn the money.

“If you want to do something great, you need a lead-in time of at least a year to get everything created and perfected, especially when you have to deal with production in China. Everything takes time.”

“You can be thoughtful around the product, too. Could it be a limited edition? Or specific campaigns for an area or city?”

So what about the products themselves? Can a merch product line create something that genuinely elevates the experience of a live show? Natalie Setton is VP at Herschend Entertainment Studios and the shepherd of the famous Harlem Globetrotters’ merch strategy. For products to really sell, she says they must prompt audience participation and tap directly into the emotive themes of the interactive basketball show, ideally also cutting across age groups. “In a Harlem Globetrotters crowd, you might see anyone from five years old to 95, so having things that tap into history while also feeling contemporary is crucial,” she says.

“There’s nothing more special than seeing kids and adults buying basketballs and then getting them signed in the fifth quarter. They can take them onto the floor during halftime and have a bounce; they can recreate all the tricks they saw in the game.”

Outside of the live arena shows, you can find the HG logo on clothing lines exclusively sold in British high-street fashion retailers, including Zara and Next. “If you’ve already got a popular merch line outside of the show, the fans will show up game-ready and hopefully already wearing your products,” Setton adds.

“You can be thoughtful around the product, too. Could it be a limited edition? Or specific campaigns for an area or city? Can we create merch that taps into a community outreach programme we’re already doing? People have an infinite choice right now of where to spend their money, so it is important to give them those emotional reasons. That’s what prompts loyalty.”

Steve Steinman is the producer of touring musical shows such as Vampires Rock and Anything for Love featuring the songs of Meatloaf. “Vampires Rock is a phenomenon in its own right and has been touring for 22 years in different forms. If you’re in the tribute market, it’s very difficult to sell merch because your brand is probably somebody else’s. But Vampires Rock has gone from a jukebox concert to using my own music and it’s grown to a point where I have a fanbase that will buy into the brand. I’m now at a point where merch puts the cherry on the cake of a tour – it’s probably 10-20% of the revenue, although I don’t rely on it to make a tour work financially.

“As well as being an income source, merch works as marketing for my shows. We have people who buy a new T-shirt for every tour. And they share photos of them wearing it, which drives awareness.”

“If there are hundreds of merch products for kids to choose from, they can end up getting confused and buy nothing at all. You need a really tailored line”

Event Merchandising’s Goldsmith says creating products that appeal to kids and their parents works well. For the Hey Duggie live shows, his company created parent-and-child matching clothing, which “sold well.” But he cautions that offering huge never-ending ranges can do more damage than good. “If there are hundreds of merch products for kids to choose from, they can end up getting confused and buy nothing at all. You need a really tailored line.”

Limelight’s Lewis agrees. An industry veteran, he says in the past, he would make elaborate products, such as a Cinderella shoe for a Christmas panto but came to realise the bespoke plush products weren’t selling. “The age group don’t want merch you take home and play with; they want things they can use right now,” he explains. “We do a spinning fan with a figure of Peppa Pig or George attached. That, along with the light-up sticks, does 50-60% of all our merch sales. Then there’s 10% on programmes, another 10% on balloons, and whatever is left tends to go on T-shirts or backpacks. When you break it down like this, it shows there are only really four main hero products.”

Light-up products can also add to the narrative told onstage, he says. “One of the areas that I find interesting is how shows now have wristbands that flash during special sequences. During the VR ABBA concerts, when certain chords hit, the wristband might turn blue. The merch can therefore have real production value.”

Creating ethical merch is another key consideration. On the aforementioned Peppa Pig spinning fan, Lewis says he spent years and years working with suppliers before finally launching a 95% biodegradable version. “We put a lot of our effort into the plastic issue, and over the years, we’ve developed an eco-friendly light-up toy. It’s been a real journey, but it’s also too expensive to create at the moment. Creating eco- friendly products is very important but it can be a while before they’re profitable.”

Creating merch lines that go viral is the current buzz, but Lewis says this can be both a gift and a curse. “It’s a question of supply. There are many examples of companies that go viral but then they don’t have any stock. People are buying and buying, and they only have 15,000 units but need 200,000. That means you have customers going crazy.”

This makes being reactive particularly important and having merchandise that’s easy to reprint or recreate should it suddenly take-off. Access to in-house production facilities is key to this, says Goldsmith. “You have to be switched-on and nimble enough to react to a viral moment. For example, when we worked on the merch for the Eurovision Song Contest in Liverpool, it totally kicked off. We created a pop-up shop near the Liverpool arena to fulfil the massive demand.”

“Sometimes we’re the first impression a show can make, which makes having a merch stand that looks colourful really important”

Analysing some of the possible pitfalls for touring merchandise campaigns, Goldsmith says pricing strategy is fundamental. He advises show producers and merch creative agencies to start pre-negotiating with venues on their cut of merchandise sales as early as possible, so they can secure the fairest possible price and the cost isn’t passed onto the consumer.

He’d also like to see more licensees providing more resources to their merchandise sellers. “They rarely give us any budget,” he says. “They should allocate at least £2,000-5,000 to branding and set-up to make the stand look good. Sometimes we’re the first impression a show can make, which makes having a merch stand that looks colourful really important.”

Ensuring you have a successful merchandise strategy for a touring entertainment show isn’t always about prioritising profit, either. Setton says if brands look at merch as a quick way to shift units, as opposed to being part of a wider plan, they won’t be sustainable. “You need a strategic, data-driven approach, where you are optimising the overall product mix. It goes beyond the numbers. We look at merch holistically as a ROI; we’re not just asking what is the financial contribution, but what is that product doing for brand recognition and engagement? Or how is it reaching new audiences and different touch points? When you consider all those things, the impact on the bottom line tends to be bigger.”

At the end of the day, getting the basics right is key, says Lewis: “You have to create a piece of merch that is idiosyncratic to the show itself. One of the phrases we use is: ‘We aren’t selling merchandise, but we are creating an experience.’ If you follow those principles and start your work early, you can’t go too wrong.”

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