Quantifying the Value of the Marvel and DC Brands

X-Men First Class movie posterWe talk a lot about comic books. That stands to reason considering iFanboy is a site devoted to the medium. We also talk a lot about comic book characters in other forms of media; whether it be the rash of comic-themed films hitting this year or the cartoons or the video games. But those are just two legs of the three-legged stool of Marvel and DC.  Licensing is the other third, and it’s by far the largest piece of the pie.

Most comic book fans understand that licensing is an important part of the equation. But I’m not sure they really ever get beyond the abstract concept. So today I wanted to take a break from the conversation about the publishing side and shine some light on global licensing.

License! Global is a trade publication that focuses on tracking and analysis of licensing, and it’s widely considered the standard bearer.  A few weeks ago, License! released its annual list of the Top 125 Global Licensors.  You can read the entire list HERE, but we don’t have to get very far into the Top 125 to hit on the comic-book related properties.

The #1 licensor in the world, by far, is Disney Consumer Products. In 2010, Disney had estimated licensed sales of $28.6 billion. Yes, BILLION.  Disney is a man amongst mice when it comes to leveraging its characters and brands into profits.  To put a finer point on just how dominant Disney is, consider that the #2 global licensor – Iconix Brand Group – has $12 billion in sales. In other words, Disney generates almost 2.5x as much licensed sales as anyone else in the world.

What part of that $28.6 billion was Marvel responsible for? After all, Marvel’s own powerful brands were a huge part of why Disney acquired the company. The answer may shock you. Zero. Zilch. Zip. Nada. How is this possible, you ask? Because License! decided to break Marvel out separately for some reason.  Marvel, on its own, ranks 6th – with estimated licensed sales of $5.6 billion.  Just take a minute and think about that number. $5.6 billion. Then think about how much we all worry about whether a comic book is selling 50,000 copies instead of 100,000 as it might have five years ago.

Rank  Licensor Sales
1  Disney Consumer Products $28.6Bn
2  Iconix Brand Group $12.0Bn
3  Phillips-Van Heusen $8.7Bn
4  Mattel $7.0Bn
5  Warner Bros Consumer Products $6.0Bn
6  Marvel Entertainment $5.6Bn
7  Nickelodean Consumer Products $5.5Bn
8  Sanrio $5.0Bn
9  Major League Baseball $5.0Bn
10  The Collegiate Licensing Company $4.3Bn

With Marvel now wholly owned by Disney, they have combined licensed sales of $34.2 billion – nearly 3x the global #2.

Don’t feel badly for our friends at DC though, they’re doing just fine, too.  Warner Brothers Consumer Products (which includes DC Entertainment licenses) ranked 5th in 2010 with estimated sales of $6 billion.

What does this all mean for comic book fans? It depends on whether you’re a glass half full or half empty kind of person. If you’re an optimist, you’ll recognize just how powerful these companies and their characters are, and that they can survive and thrive even if the publishing market has to deal with a transitional period away from the current direct market dominance. If you’re more of a pessimist, you could conclude that the characters at Marvel and DC are so massively profitable as brands, that the success or failure of the traditional publishing arms really don’t mean much in the grand scheme of things. Where do I fall on the spectrum? I’m feeling optimistic these days for two reasons:

 
  1. Marvel has now been part of Disney for more than a year and it appears that Disney has largely left the publishing business alone. Meanwhile Joe Quesada and other executives have been elevated to positions where they’re touching on other aspects of the media conglomerate, but have clearly not lost their interest in, or public support of, the publishing side of the house

 

  1. DC has similarly promoted a number of publishing people – most notably Jim Lee, Dan DiDio and Geoff Johns – to positions with broader reach.  As importantly, Diane Nelson is running the show and she is laser focused on branding and licensing, having managed Warner Brothers massively profitable Harry Potter partnership for years. The fact that she has been at the helm for over a year now and decided to INCREASE the focus on the publishing business, tells you that the higher ups at Time Warner value it, or at the very least value what they think it could be after the DCU transition in September.
 

Jason is a mutant with the ability to squeeze 36 hours into every 24-hour day, which is why he was able to convince his wife he had time to join the iFanboy team on top of running his business, raising his three sons, and most importantly, co-hosting the 11 O'Clock Comics podcast with his buddies Vince B, Chris Neseman and David Price. If you are one of the twelve people on Earth who want to read about comics, the stock market and football in rapid fire succession, you can follow him on Twitter.

 

 

Comments

  1. Interesting article, as per usual.

    I’m curious to know how much of Warner Bros. percentage is dedicated to properties owned by DC Comics versus other areas of the media conglonmorate, like Buggs, Daffy and the like.

    -J. 

  2. Thanks for another great article, Jason. I wonder what DC’s contribution to Warner’s money is. Also, was the decision to split Marvel from Disney for historical reasons? Otherwise, why not do the same for DC?

  3. Jeff Reid Jeff Reid (@JeffRReid) says:

    Harry Potter has to be a rather large percent of that Warner Brothers money. I’d love to see it and DC’s numbers solo. Oh well.

    Great article, Jason! Always a pleasure to read these. 

  4. When I see numbers like this the first word that comes to mind is potential.  The popularity of these characters is off the chart.  If the actual comic book industry could tap a reasonable fraction of that potential market its size would increase dramatically.

  5. Thanks folks. I suspect Marvel was kept standalone for comparison purposes, but going forward it will be included in Disney’s holdings, now that we’re more than a year past the acquisition and so the numbers will grandfather. That’s also why DC isn’t broken out, as it’s been a part of Time Warner for many, many moons.

    As to the % for DC versus other brands, I don’t have those numbers but you’re right that it’s only a part of an impressive lineup that includes Looney Tunes, Harry Potter, Hannah Barbera, Bandai, etc…

  6. How much licensing does Warner’s do with the Harry Potter property?  

  7. Nice article, Jason. This is EXACTLY why I never feel bad for the big two when people talk about how little the comics sell.

    I realize that Disney & Warner most likely operate the comic lines seperately from the big budget movie and lincensing arms. But even in that regard, if the comics don’t make a ton of money. You can still view them as a farm system for characters and stories to be licensed into movies, tv shows, and toys.

    And with that in mind, you could argue that comic books are a MUCH more successful business to be in today, weak sales and all, than they were back in the golden years when books sold at greatly higher numbers. It’s all about how you look at the entire puzzle.

    I genuinely feel for independent comic creators and small publishing companies. Today’s every changing market is a very tough one for them. But I have zero sympathy for Marvel or DC and their dwindling comic sales. As this article clearly shows. They’re gonna do just fine.

  8. This may be the most interesting article on the site in a long time. Nothing against the other great stuff that appears here; that’s how interesting and succinct I found this.

    I think you can take these numbers at nothing but a win for the Big Two, and for comics as a whole. Essentially it means that these huge media conglomerates can let their comics publishing branches act as independent idea-houses (imagine that) and then cherry-pick the best ideas and characters to turn into real money.

    It sure doesn’t help Marvel justify the $3.99 price point, though.

  9. RaceMcCloud- True

    If anything it might serve to operate more as a loss leader for licensing.

    More ideas out there- more exposure more licensing opportunities.

  10. Seems a rather simple formula to me.

    The more comics = more movies & tv shows = more toys = $$$$$$$$$$$$$.

    And I agree with Race. It makes the guilt trip we’re constantly given for $4 comics pretty ridiculous, IMO.

  11. no wonder marvel is forced t keep their flagship titles at $3.99…..

  12. Diane Nelson is running the show and she is laser focused on branding and licensing, having managed Warner Brothers massively profitable Harry Potter partnership for years. The fact that she has been at the helm for over a year now and decided to INCREASE the focus on the publishing business, tells you that the higher ups at Time Warner value it, or at the very least value what they think it could be after the DCU transition in September.”

    This made a DC fan smile. 🙂

  13. Yep. Thanks for pointing out something far too many people in comics don’t even realize. I don’t have it on hand, but Marvel’s last annual statement (2008, I think) clearly showed that licensing was where the money was coming from. The film business was close second, but at that point, a lot of the films were still outside Marvel Entertainment.

  14. @wood–Marvel stuff isn’t listed on the DCP site as one of their franchises, so maybe they’re keeping that as a separate entity like ABC and ESPN?

    whats kinda scary/shocking/interesting is that the Disney Princess line is listed at doing $4 billion in global sales on the DCP site, which is the same amount that Disney bought Marvel for…So 9 princess characters are worth the same as the entirety of Marvel Comics. Puts it in to perspective the value of things and how good Disney is at creating value. 

  15. I’d be interested to see how much of the Disney, not Marvel, money comes from Boom! Studios.

  16. @AceBathound are you being serious? A very, verrrrrrrrrrrrrrrrrrrrrrry small amount.

  17. @j206  Coroporate structures mean that the people in the publishing division don’t necesarily benefit from the work of the licensing devision. I know people who work at Marvel Comics, they do not take money baths from their salaries. Just because Disney makes a lot of money licensing Marvel characters doesn’t mean the publishing division is allowed to lose money.

  18. Conor is exactly right. Marvel when it was standalone held all its divisions to their own P&L (Profit and Loss) requirements. Marvel’s publishing division was expected to generate a certain EBITDA margin, regardless of what the other divisions were doing. 

  19. Those numbers for Disney are INSANE.  I can’t believe they license that much product. 

    Now, if I could just think of a character with a defining characteristic that is charming…

  20. @Wood  Oh I don’t expect it to be huge, what would it make for sense for them to just put those books out in-house now?

  21. @wallythegreenmonster  There are a lot more little girls whose parents buy them Disney Princess stuff that that there are of us nerdy comic book guys! LOL

    I’m sure both parent companies look at the comics as a cost of doing business – an intellectual property machine that could come up with the next big thing. “You boys go make your little funny books, and we’ll license what you come up with.”

  22. @Conor @Woodd – You guys are right. I totally realize that. That was why I made a point of mentioning that I’m sure the different divisions and branches are run independently. That’s just how large corporations work. I am well aware. Even in smaller businesses like the one I work in. Nine times out of ten, at the end of the day fair doesn’t matter. It all comes down to cost-effectiveness. I definitely get that.

    And I wasn’t saying that comic creators get any of the money coming from the liscensing (that is unless they are involved in the film or cartoon adaptations or toy design. which some are). I was suggesting that if Disney or Warner were to take the time to consider the cause and affect the comic industry can have on their other sources of income. That comics don’t have to be an entirely, 100% self-sustaining entity. That’s likely a somewhat hopeful way of looking at things. But I think there has got to be at least some level (even if small) that comics as fodder for other outlets is valued by the parent companies. 

  23. a lot of people have suggested comics as a loss leader or some kind of R & D for movies and toys, but this doesnt really make sense to keep publishing for that reason. So far theres plenty of R&D done that hasnt been exploited, and most of Marvel’s licensing is from characters over 25 years old. If your company R&D department hasnt made a successful product in 25 years, its time to close their doors.

    Disneys success in licensing could make things worse for marvel. they make a ton of money selling product for characters who arent being published in comics so why would they need a spiderman comic to keep selling spiderman toys and bedsheets. Since publishing generates so little total income, the only reason to keep it around is that it is highly profitable. Lowering prices without lowering costs means lowering profits. That could easily make publishing less profitable, so that just making a new cartoon or two (with the money that once published a years worth of comics) would actually be more financially viable than publishing.

  24. What I don’t get is this: Why doesn’t Disney put some comic racks in their Disney Stores? They obviously wouldn’t sell Fear Itself or most of the mainstream stuff that Marvel puts out, but why aren’t they pushing kid friendly titles like Spidey Fun and Fantastic Four’s Marvelous Adventures to hook kids early. All this talk about the industry needing to bring in younger readers. Well both the and Warner Bros have stores all over the world. Why aren’t they giving comics more exposure, especially now with all these properties being turned into films? Obviously they would prefer to sell a $30 doll instead of a $3-4 comic but if you get them hooked… I have a $60-70 monthly comic book budget and about half of that goes to Marvel. And a doll is a one time thing. A comic book addiction can last a lifetime.

  25. You guys really need an edit button. I forgot a question mark and it’s driving me nuts…

    Also, GREAT article. 

  26. @abstractgeek  –the comics keep a lot of the characters in current pop culture even on a small level. If the comics didn’t exist the characters might really fade away into obscurity and labeled as retro or old which isn’t the best situation. Although, my pessimistic fear is what you outlined…the comic characters will just become cartoon characters first and foremost as comic books fade away.

    Also Disney has a proper publishing division separate from the comics that makes lots of books. It grinds my gears when people call Marvel Comics the publishing division cause its really just a boutique subdivision within an empire. 

    @nick7913  –a doll or toy is in some ways a one time thing, but really its not. Every year there are millions upon millions of 5-10 yr olds who want new toys for Christmas. Its an incredibly sustainable supply chain. Even if the individual kid grows out of the toyline, there is another one or two to take his place. 

  27. @wallythegreenmonster  But we’ve heard time and again that most people aren’t even aware that most of these comics still exist; out of sight, out of mind. I think most people think of comic book stores as carrying old collectable comics and don’t realize so many titles still come out every month. Most characters have already faded into obscurity and are labeled retro, we just happen to be living in an era when retro is fashionable again. The torchbearers for this generation are not the comic books themselves but the TV series and movies that keep the characters in the public eye.
    Even though my father did own a pretty big collection of comics, I still mostly got into the X-Men, Batman and Spider-man through their respective animated series during the 90’s. And even though I did read comic books for a while I got out of the hobby for 6-7 years except for regularly reading Duck comics. I only got back to comics because a friend handed me Astonishing X-Men and Ultimate X-Men and they rekindled my interest. 
    The worst part is that I missed out on a whole era of great comics and I only managed to catch up because I tried really hard and spent A LOT of money. If the industry hadn’t lost me (and tens of thousands of others just like me) in the first place, they wouldn’t be in this position now.  

    “Although, my pessimistic fear is what you outlined…the comic characters will just become cartoon characters first and foremost as comic books fade away.”

    I feel like this has already happened. The question is where do we go from here. 

    Finally, yes, kids always ask for dolls for Christmas and it’s definitely a bigger market than comics. But if the industry can tap into the part of the pool of children that loves to read (which Harry Potter has proven beyond any reasonable doubt is huge) it can once again become a popular hobby, maybe then prices can finally be lowered a bit and creators won’t have to depend so much on these gimmick mega-crossover events that happen more and more frequently nowadays. Which, if you get right down to it is because readers have become so few that the only option of the Big Two is to milk us dry to turn a profit. 

  28. Sorry Wood but those numbers cannot be accurate.  Disney posted total revenues of $38B in 2010, it is not possible that excluding licensing they made only $4B.
    Also, Marvel in 2008 (last full fiscal year thet were a public company) had total sales of $ 0.7B (therefore licensing was <$0.7B).  That number cannot have gone up almost 10 times in 2 years.

    Probably the numbers posted in the table are estimated total revenues generated by all third parties that pay licensing fees to Disney and Marvel.

  29. @odino1  Good point, but I think both numbers are right. I think a lot of people are assuming that’s $28B the Mouse put in his pocket. The numbers were for total SALES, not profit. Disney got a licensse fee, but that doesn’t mean they made money off the sale (except for Disney-owned stores). Some foreign manufacturer made the stuff, for which they were paid. Retailers bought the product wholesale, then marked it up to retail and sold it. The retail sales could easily have been $28B, but Disney didn’t make all that money – but the sold a shit ton of stuff.

    Don’t forget, it costs money to make money. How much did Disney spend making movies, paying employees, and other costs of doing business? This isn’t $28B in net profit, as some may assume.

  30. One thing with WB and Harry Potter: how much cut does J. K. Rowling get? My guess is, as a license, Bugs Bunny and Scooby Doo are more valuable since WB owns them outright (and Supes and Batman moreso).

  31. @kennyg: I perfectly know the difference between sales and profits.   The numbers in the table are sales by third parties that pay a licensing fee to Disney, not direct sales by Disney (I never said profits). I wanted to point it out because Jason doesn’t clearly state it in the post.  Probably licencing fees (that counts as Disney’s sales) are 5-10% of the licensed sales in the table.

  32. The distinction between sales and profit isn’t that important here. For comparison purposes, we can safely assume that the costs of producing a Disney-branded lunchbox is pretty much the same as for a Marvel-branded one. And in fact, it is likely the same companies making and selling both boxes. The margins for both Marvel and Disney are broadly similar, therefore. The sales figures are still very useful for giving us the scale of the businesses, and for relative comparisons between the top firms.

    Great job on this Wood, as usual! 

  33. @odino1  Those are the sales generated by goods and services using LICENSED IP from those companies, not what they make on those licenses. Thought that was pretty clear, but if not, apologies. A licensor gets a fee for the use of the brand, which of course is a percentage of the total value of the sales generated. Otherwise, why would anyone license anything?

  34. Great article.  The question that isn’t being asked here (and I think it should be), is how do we redirect (or multiply) those same consumer dollars back into the seed industry (comic books), or is it even possible?  To a large extent, the answer is probably no, but even a tiny percentage of that cake would mean a massive influx of cash into the publishing end for Marvel and DC.  There’s got to be a way to use synergy and cross-promotion to help improve the comic industry.

  35. @positronic  that’s the age old question. The major hurdle there has been ACCESS. Advertising comic books when most people had to find an LCS to get them, was foolhardy. But now with digital? I expect Time Warner to finally give the books their due.

  36. @odino1  Don’t take offense, I think we’re saying the same thing. It just seemed like a lot of other people were thinking that amount was net profit to Disney, which is not the case.

  37. Well done. This is a great argument back to the continuity freaks who walk away in disgust after a status quo/continuity change.

    The lesson is: these characters will always be bigger than their comic book stories, and none of the history is written in stone. accept it, and apreciate the attemp to reinvigorat a character or team. if it fails, they’ll just try again and fall back on the old tried and true way.

  38. @wordballoon thanks John. As old grizzled comic book fans you and I certainly get (and have been guilty of) an unnatural affinity for these characters and their history, yet as you (and I) pointed out, if this industry is going to survive, much less thrive, it has to be about those experiencing these characters for the FIRST time, not what we expect experiencing them for the 1,000th time. And as you point out, nothing is stopping them from rolling back to this status quo if they feel the relaunch was an abject failure (which I doubt will happen but the option is always there).

  39. I would like to know how much of that 6 billion is Batman and Superman 

  40. @palemoondevil  – I’ll bet the vast majority of it. For Marvel, I’m sure Spidey is #1.

    I read once that Disney’s #1 licensed charcter is…Winnie the Pooh (which came for an acquisition, to boot). It was b/c of all the Pooh licensing for newborns and infants.

  41. So i just did a double take. Marvel sells 5.6B worth of licensed stuff but was sold for $4B….so Disney really got a bargain or are those above numbers not indicative of how much a brand is worth just total sales?

    “Damn it Jim i’m an artist not an economist” kinda thing. 

  42. @wallythegreenmonster  No…other companies sell $5.6 billion of Marvel stuff each year, and they pay Marvel a percentage of that for the right to use the images.

  43. @Wood  –oh i get you. You mean the world of multi billion dollar licensing isn’t as simple as trading baseball cards?? darn it. i’m sticking to the art/design thing.