In 2016, the British Museum granted Chinese company Alfilo Brands the exclusive rights to sell licensed products in Greater China. As part of the collaboration, Alfilo has negotiated 34 different partnerships with Chinese companies on behalf of the British Museum, selling hundreds of millions of museum-branded products and generating tens of millions in sales. Neither the Museum nor the licensing company will disclose the British Museum’s shares of these sales, but we do know that in 2018, global merchandise sales for the Museum were £21.5 million; In 2019, that number rose to £37 million.
In 2017, the Victoria and Albert Museum signed its own partnership with Alfilo Brands, while the National Gallery in London, the Metropolitan Museum in New York and the Museum of Fine Arts in Boston ended their collaboration with the company in 2018.
This year, Alfilo Brands founder Yizan He founded a new company, ARTiSTORY, to license products globally, and has just secured exclusive global rights to the Brooklyn Museum Collection. We talked to him about partnering with western museums to sell branded products.
Al-Fan Newspaper: How did you start licensing museum products?
YIZAN HE: I started working with museums six years ago. At the time, I was running my own company, Alfilo Brands, and we were working with several Hollywood studios on licensing and merchandise in China. Film licensing work is tough and the cost of working with big studios has always been high, so this was actually a money-losing business for me.
Then, in June 2016, one of my American colleagues called me in the middle of the night and said, “Yezan, get a flight ticket and come to Las Vegas tomorrow. I want you to meet the British Museum.” I said, “What does that have to do with my work?” Because I never thought of working with museums. But I took a flight from Shanghai to LA anyway, and then traveled all the way to Las Vegas for the major licensing fair.
I wandered around the exhibition hall, which was mostly occupied by Hollywood studios like Sony Pictures, and couldn’t find the British Museum anywhere. When I was about to give up, I saw a small table near the toilet with four little notebooks on it. There was no booth. I was very disappointed. And there was no one from the British Museum because they didn’t have the budget; Instead, they hired an agent to sit at a small table. So I sat with him and he said, “Yezan, I know you’re frustrated, but that’s what I’d like to share with you. You’ve been working with Hollywood Studios, and they ask you to create hundreds of licensed products to sell in a week because the way movies come and go, you usually have days Only to sell your licensed products. But with the British Museum, we talk about art and history. The British Museum contains over eight million artifacts spanning across multiple civilizations and all of these properties are timeless. If you work with us, you will have the right to use all of these assets.” At that moment, I almost fell off a chair because my excitement was hard to contain. I talked to that agent for half an hour and that half hour changed my life.
We don’t simply paint paintings on things. Because this is not a way to engage the younger generation
I am very proud that three months later, on September 30, 2016, we signed our first five-year master licensing agreement with the British Museum in China exclusively for all product categories.
Was it renewed?
Not only was it renovated, but it was extended to eight years because the British Museum liked the program so much. One of the online stores we operate for the Museum in China, Tmall, receives an average of nearly 24 million visitors per year – four times the number of visitors to the British Museum in person each year.
What products have you made for the British Museum and other museum partners?
We have thousands of different products from stationery to home furnishings, scented diffusers, apparel, surfboards, and bottled beverages. The products we collected are not souvenirs. They are not key chains or fridge magnets. Everything we make is a lifestyle product. We don’t simply paint paintings on things. Because this is not a way to engage the younger generation; They want something new and modern.
We do not screen entire museum collections; That would be impossible. We work with international trend forecasting companies such as WGSN. They predict upcoming trends; We look at those trends and collect our own subjects; We prepare four to six every year. For example, one of the current themes is “Wave from the East”, which is inspired by Hokusai The Great Wave. Next, we collaborate with all of our museum partners to find Hokusai’s works in their collections and use them as a starting point. Our designers then create new patterns and illustrations inspired by the original print, and we use them in a range of products that look modern and appealing to the younger demographic.
How much do museums contribute to the products you create?
We work closely with the museum’s marketing teams because our mission is to help them expand their global audience. So, for example, the National Gallery in London will host an exhibition on Raphael in 2022. With this in mind, we’ve grouped themes and designs together so that a license can support the exhibition. Many of the works we use are not protected by copyright; Hokusai wave, for example, is already in the public domain. Anyone can use it on any product. But they can’t tell a true story like we can because we work in partnership with museum experts. Each licensed product we create must be approved by our museum partners before it reaches the market.
What is your best selling brand museum product in China?
It’s a product we created as part of an Alvelo Brands licensing deal it brought together for the British Museum with a Chinese beverage company called the President Group, which used images of a pharaoh boy inspired by the museum’s Egyptian collection on bottles of Xiao Ming classmates, a tea beverage marketed to teens. We sold over 250 million of them. Now with ARTiSTORY we are working on very interesting projects, for example, with a very large international home appliance brand trying to expand its coverage in six European countries and in North America. We’re bringing them together with the National Gallery to launch a licensing program in these markets. We’ll be doing a lot of digital marketing, like livestreaming from the National Gallery; Everything is digital.
Can you give assurances to museums about your supply chains and working conditions for all the people who make your products?
After working with Hollywood, I learned my lesson. Our film partners take work, business and now environmental issues very seriously. Therefore, we learned that it is important not only to say “yes, we will comply with these requirements” but to actually present the results, show evidence, and adopt an open book policy. we’ve got
The internal compliance committee chaired by our legal advisor and a few department heads. Their job is to make sure we deliver what we promise our museum partners. Which means that when we sign licensors, if they claim that their products are environmentally friendly, we need to make sure that they are. We also work with many international factory audit firms. When the Hollywood studios they have cooperated with in the past work with local manufacturers, they need to see factory audit reports, so they hire specialized firms that review working conditions in the factories and go to the dormitories where workers live to see the conditions. These companies are industry experts and trusted by global consumer brands. The reports they produce for us are shared with our museum partners.
How much money do your museum partners earn?
Each museum receives different levels of royalties, but we stick to the minimum amounts guaranteed for them. So, for example, we just signed an agreement with the Brooklyn Museum for the exclusive global rights to their collection and agreed to pay them a set royalty fee each year, no matter how many products we sell because it shows them that we’re ready to dedicate a lot of resources to making our partnership a success.
In general, can you tell us what is typical museum pieces in this industry? Does it represent 10% of net sales?
It’s less than that, usually between 3% and 10% of net sales, because museums have the artifacts, but my company does all the actual work: We’ve created design assets like illustrations, prints, and patterns that can easily be applied to products. What we do is really innovative. It is now normal for the younger generation, Generation Z, to learn about art through social media. And they love products like ours. Our research shows that at least 70% of our clients are female with an average age of 25-30 years.