Do you often find yourself wondering how so many movies that seem to underperform at the box office are allowed to continue making sequels? Movie merchandising is the dirty little not-so-secret that many production companies rely on for either supplementing the ticket sales of their tentpole films or for making up lost revenue with underperforming features. That’s why box office fails that sold merchandise were able to keep cranking out dismal sequels - as long as people are still buying their film’s merchandise, a sequel needs to be created as a commercial for the products that people actually want.
But it isn’t just box office clunkers that make the bulk of their revenue on merchandise sales. Any incredibly successful film has a licensing deal in place so everyone can capitalize on its popularity. In the case of Star Wars, the revenue made from The Force Awakens merchandise gave Disney the cache to take a “risk” with a one-off film like Rogue One - a film that had less merchandising potential than one in the main canon.
Merchandising has always been a part of the film industry, but some films have really capitalized on branded consumer products. Sometimes, the merchandise sold itself. Other times, film companies came up with brilliant marketing strategies for their products. Either way, these films all found success outside the box office.
Frozen was a massive success at Disney, ending up with $1.27 billion at the box office, but the real money was in merchandising. In 2014, Disney sold $5 billion in merchandise related to the film. In fact, Frozen's merchandise sales were so successful that some retailers were feeling the strain of selling too many products related to Elsa, Anna, and Olaf.
The International Licensing Industry Merchandisers’ Association claimed retailers were seeing brand fatigue from selling so many third party Frozen related products. It sounds like they just need to let go and count their money.
By 2017, the first two films in the Fifty Shades of Grey trilogy had grossed just under a billion dollars - which is a lot of money, but it's nothing compared to the amount of revenue generated by the merchandise related to Anastasia Steele and Christian Grey.
The book series was widely acknowledged as what saved Barnes and Noble from going under, and almost anything that could be marketed to fans of the series was sold to them at an expensive markup. It's safe to say as long as Fifty Shades merch keeps selling, E.L. James is going to find a way to keep telling new stories about Anastasia and Christian.
It's almost impossible to not run into something Minion related these days. Licensors have made sure to put a Minion on everything they can sell in order to move it out of their stores.
According to Stephanie Sperber, the former Universal president of licensing and partnerships, Despicable Me 2 only had 250 licensees, whereas the Minions solo film had a whopping 850, which has got to be bringing in a lot of cheese for this franchise. She added, "and we're not close to being maxed out in terms of the number of licenses." The overall cash cow of the Minions has earned Universal at least $2.5 billion from just retail sales.