NOSTALGIA FOR SALE AT FRANKLIN MINT

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Corporate America is discovering the power of collectibles.

The Franklin Mint has partnered with the Louvre, Museum of Contemporary Art and even the Vatican to create quality, commemorative artwork to market to collectors worldwide. Now, because of visibility and revenue, corporate America is betting on such licensing partnerships.

Corporate marketers teaming with The Franklin Mint include: Coca-Cola Co., Walt Disney Co., Harley-Davidson, Gold Medal, McDonald's Corp., Ralston Purina Co., Paramount, Good Humor Corp., Pillsbury, Revlon, Planters Co. LifeSavers, Leaf Inc.'s Good & Plenty, and Campbell Soup Co.

"Corporate collectibles are the big story in 1995. We are tying our products to pop icons and the top commercial brands, the global superbrands," said Lynda Resnick, Franklin Mint vice chairman.

The allure of the Franklin Mint, based in Franklin Center, Pa., a suburb of Philadelphia, is the 8 million customer names on its worldwide database, its reputation for quality artwork, and the reach and almost unlimited ad budget it puts behind its collectible products. Customers are reached through state-of-the-art direct-response marketing and through ads placed in consumer and trade publications. Licensees get the benefit of sophisticated marketing designed to match consumer to product.

After the product is developed, the Franklin Mint puts big advertising dollars behind it. The company is the country's 27th largest advertiser, according to Advertising Age superbrands.

The privately held Franklin Mint, one of the world's largest direct marketers, will have 1995 estimated sales of about $800 million worldwide, of which U.S. sales represent about $600 million. That is up from $350 million in 1987, according to sources.

The collectibles industry totals about $6.4 billion with retail the leading channel, representing 67% of industry sales, direct marketing with 28%, and TV shopping with 5% of sales, according to a study by Unity Marketing, Reinholds, Pa., a collectibles industry consultancy. Direct mail collectible sales totaled about $1.7 billion in the U.S. in 1993.

Industry ad expenditures totaled about $550 million. Of this total, the largest share, 81% or $444.4 million, was spent in direct response advertising, according to the Unity Marketing study.

The Franklin Mint's relationship with Coca-Cola began 18 months ago with a series of plates tied to the soft-drink marketer's archival advertising featuring images of Haddon Sundblom's Santa Claus, and has grown to include 3-D plates and a line of Coca-Cola collectible dolls.

"When people drink Coca-Cola, they associate it with family and friends and adopt it as part of their lifestyle. A licensed Coca-Cola product brings the product that much more into their lives. It is something they can take ownership in. That is why we choose to license.*.*. It is a way to get the Coca-Cola trademark to consumers around the world," said Susan McDermott, program coordinator at Coca-Cola.

For brands, teaming with the Franklin Mint can mean a significant extension of their marketing budgets. "Just with Parade, USA Weekend and TV Guide, we reach 70 million households every week," said Martha Wright, VP-licensing and artist relations at Franklin Mint.

But the Franklin Mint goes beyond that, advertising in many more magazines, including specialty publications. "The reach of our ad budget [is significant]. We are also in publications [that marketers] could never be in, because the brand manager has to use dollars wisely. For example, for the Gold Medal flour collectible plate featuring cats, The Franklin Mint can buy ads in home decor books and cat publications," Ms. Wright said.

The Franklin Mint's original business, coins, is now just 1% of total business, representing a dramatic shift in collectibles.

Today, there is high end ($555 luxury edition Monopoly game) and low end ($29 Coca-Cola collector plate). The Monopoly luxury edition game is so hot, the Franklin Mint built a whole Monopoly business, including a Monopoly table and set of chairs and a set of wall prints.

The Franklin Mint has affiliations with automotive companies for high-quality, precision-crafted models of cars, trucks and motorcycles. Its association with Harley-Davidson created what is believed to be one of the hottest direct mail programs of the year.

The type of collectible varies per licensing partner and may take various product forms. Products that do well will earn more ad support and added product development, Mr. Wilkie said.

Hollywood is big at the mint as evidenced by licensing partnerships with MGM, Warner Bros., 20th Century Fox, Disney, Viacom, Hanna Barbera and Paramount.

Licensing is hot because, "These brand names are cultural icons. They define people and generations. Everyone stops when they see old TV advertisements-Alka Seltzer, the Marlboro Man. Advertising is so much a part of our psyche and who we are as a people. So it is natural that advertising memorabilia would become a collectible entity," said Pam Danziger, president, Unity Marketing.

The marketers that license their brands have "an opportunity to get that brand name out to a new type of market," she said.

The Franklin Mint is growing its retail presence with museum-quality stores, allowing consumers to see products up close and personal. There are nearly 50 Franklin Mint Gallery stores now, carrying a full range of collectibles such as heirloom dolls, precision-crafted cars, fashion jewelry, collectible plates, luxury edition games and sculptures.

Some of the Franklin Mint's competitors in the collectibles industry include MBI, the parent of Danbury Mint; Bradford Exchange; and Lenox Collections.

The Franklin Mint was founded in 1964 by Joe Segel, who later founded QVC. Warner Communications acquired it in 1981. The Resnicks acquired it from Warner in 1985 for $167.5 million and took the company private. Today there are 4,500 employees in 18 offices worldwide.M

Laura Loro coordinates Direct Marketing. Contact her at (609) 784-9090; fax, (609) 784-9119; or 904 Champlain Drive, Voorhees, N.J. 08043.

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Franklin Mint

Headquarters: Franklin Center, Pa.

Estimated sales: $800 million worldwide; about $600 million in the U.S.

Leadership: Stewart Resnick, chairman; Lynda Resnick, vice chairman; Tom Durovsik, president; Patrick Murray, senior VP-marketing; Marty

Breisblatt, senior VP-sales; Dona Fisher, senior VP-operations; Martha Wright, VP-licensing and artist relations; Jack Wilkie, VP-communications and marketing; Marvin Melnikoff, VP-sponsor relations & licensing.

Ad spending: $121 million (27th most advertised brand last year, and top advertiser in Sunday magazines, according to Advertising Age.)

Agency: In-house. May be the largest in-house agency in U.S., with nearly 100 employees. Headed by Bill Molnar, VP-advertising.

Recent successes: Entrance into hot corporate collectibles market, via partnerships with global marketers like Coca-Cola Co. and Harley-Davidson; opening of museum-quality retail outlets.

Future challenges: Alter lingering perceptions. "We're not your grandmother's collectible company anymore," says Ms. Resnick.

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