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New distribution channels will change the licensing landscape.

"Over the last few years," reports Didier Vanneste, vice president and managing director, Disney Consumer Products, emerging markets, North and Central Eastern Europe, Middle East, and Africa, "the Polish retail market has been evolving considerably. There has been a marked shift toward supermarket expansion in medium-sized cities and very fast development of discount chains all over Poland, and a determined effort by international chains to reach medium and small towns, until now dominated by traditional distribution channels."

Hakan Durdag, CEO of ELC, Warner Bros.' agent for Central and Eastern Europe and the Commonwealth Of Independent States (CIS), stresses, "Modern retail chains are still in development in Poland, with close to 200 hypermarkets and 2,500 supermarkets. How far they still have to travel though," he continues, "is illustrated by the fact that 65 percent of all Polish retail still is generated by traditional channels, and the two leading hypermarket chains only have an estimated 15 percent of the retail market."

Both execs highlight the popularity of discount stores in Poland, a sector dominated by Portuguese-owned chain Biedronka. Vanneste estimates the discount sector takes "16 percent of modern distribution, through a total of about 1,400 outlets nationwide. This compares with 9 percent taken by supermarkets, and 17 percent for cash-and-carry, a sector dominated by Germany's Metro Group."

Vanneste and Durdag agree that price is a significant determinant in the Polish licensing market. "There is strong pressure on price competition, caused by the relatively low purchase power of Polish consumers," says Vanneste. Although, he does add, "licensees need to fit their price positioning into new sales channels while also diversifying their product portfolio to meet the special needs of various retailers."

The strongest selling product groups in Poland are toys and stationery, according to both Vanneste and Durdag, but there is a noticeable divergence of opinion as to the standing of apparel, which Durdag describes as "small but growing," and Vanneste as "showing strong growth due to rapid expansion of specialist retailers in softlines."

For ELC's Durdag, the key to licensing success in Poland lies in "a good publishing program, effective distribution of the toy line, broadcast of the series on a leading channel, and effective communication of the new property to retail and potential licensees, supported by strong local marketing and PR in Poland."

Disney's Vanneste has a slightly different take; for him, "the key success factor in licensing is a well-known brand; intensive media and marketing support; a high-quality product offer suited to all major distribution channels; and a strong key account and promotion relationship with all major retailers, which, in Poland, include Tesco, Auchan, Carrefour, Real, and Leclerc."

Probably Durdag sums up the situation best, with his observation that "the whole concept of licensing in Poland is still new, and is being discovered by businesses and consumers alike, but new retailers are coming to the market all the time, and they all want traffic-building product with which to fill their shelves, and licensed items and promotions are one such product."