Character merchandising involves using fictional or real-life characters to market and sell goods in order to attract customers who identify with those characters. It began in the 1930s when Disney licensed its cartoon characters for products. A key advantage is that it generates brand awareness and excitement for both the product and the character. However, character merchandising also raises legal issues regarding celebrities' rights to control the commercial use of their identities. Overall, character merchandising has become an important marketing technique, and laws will need to continue adapting to address emerging issues in this area.

1. Linking Trademarks and Character Merchandising
"Good merchandising will always take the consumer from deciding whether that are going to
buy which are they going to buy."
- Steward Goldsmith, the Vice President of Sales for Todson
Characters, in general, elaborately cover both fictional beings (for instance, Mr. Bean and
Mickey Mouse) and non-fictional beings (for instance, Usain Bolt and Michael Phelps). These
characters and their peculiar traits, including their name, image, appearance, or voice, help
distinguish them from others as they are easily recognizable by the public at large. The same can
be used to the benefit of the trade by deploying them as a marketing method to attract consumers
and gain fame.
Defining the Ambit of Trademark Merchandising
'Trademark Merchandising' is more popularly known as 'Character Merchandising,' which is the
second adaptation of a fictional or non-fictional character by using them concerning goods and
services to gain prospective customers due to such close affinity. Often, the creator of the
character is not the proprietor of goods and services; instead, a contractual agreement plays a
much vital role in this regard. Consider the examples as mentioned here below:

2.  A 3D reproduction of Bumble- Bee from the movie Transformers in the form of a toy
 A printed image of Betty and Veronica from Archie comics on a t-shirt
 An advertisement for an energy drink by Lionel Messi from FC Barcelona
The concept of such merchandising is not new, and the very first traces can be found in the
1930s when Walt Disney Studios chose to exploit its cartoon characters in a secondary format by
granting licenses to manufacturers for the distribution of products, such as posters, t-shirts, toys,
badges, etc. This technique can open a commercially flooded gate, as also seen in 1979 when
Kenner Products made great profits by selling over $100 million worth of merchandised goods
by using characters in the Star Wars movie.
Kinds of Merchandising
i. Merchandising of Fictional Characters: This is the earliest form of Character
merchandising observed so far. It utilizes prime features (name or appearance) of a fictional
personality in advertising and marketing the goods. Consider the following real-time
examples:
 The use of Minnie Mouse/Mickey Mouse on Cadbury products
 The use of Tom & Jerry 2D pictures on t-shirts or sweatshirts
 The making of Johnny Bravo toys or miniatures
ii. Personality Merchandising: This involves the utilization of essential attributes like the
name, image, voice, or any other distinguishable feature of a real person in furtherance of
marketing or advertising a good or service. Therefore, this type of merchandising is
sometimes also mentioned as 'reputation merchandising.' The rationale of using this route is
that consumers are lured into buying products since the image of celebrities or characters
appeals to the public, and it is solely not because of the vitality of the product. For

3. bifurcating this category clearly, famous personalities from either the film or music industry
are deployed, or those from a particular field like sports are used. Consider the example of a
brand of musical instruments being merchandised by using the image of a famous Rockstar.
Merchbar sells a lot of merchandise, including vinyl records, hoodies, face masks, by
embarking famous musicians and music artists.
iii. Image Merchandising: It involves the use of characters in film or television entertainment.
In this type of merchandising, the characters are so deeply intermingled and associated with
the real person that it becomes difficult to differentiate the artist from the fictitious character
he plays; for example, the character of James Bond 007, played by Sean Connery and Roger
Moore, or Mr. Bean, played by Rowan Atkinson. While using this route, goods or services
are marketed while merchandising the distinctive elements of a film that might have been
remarkable, for instance, the introductory scenes of the James Bond film.
Interplay of Trademarks
Trademarks seamlessly play a greater role in our daily lives, and we come to be associated with
them in one way or another, ranging from posters, televisions, radio, circulation of newspapers,

4. etc. The traditional forms of advertising and marketing include trademarks utilizing words,
logos, or even tag lines. On the other hand, the non-traditional forms could include trademarks
utilizing holograms, complex logos, which are pictorial, or even the shape of the good itself.
However, a mark may qualify as a legitimate trademark only if it satisfies the basic requirements
laid within the legislation, which are as follows:
 It should be capable of graphical representation;
 It should appeal to the eye; and
 It should be capable of distinguishing the goods and services of one from that of another.
Therefore, if the given conditions are satisfied, the character being merchandised may qualify as
a trademark. Also, as per the aesthetic functionality doctrine, a 3D configuration may not be
accepted for Trademark Registration unless it has acquired secondary meaning (degree of
renown) in connection to the goods or services. For example, the name of the character Snoopy
has secondary relevance, and so does James Bond, Zorro, and Tintin. Even the drawings of their
appearance can be trademarked.
The grant of monopolistic rights over such marks does not protect the rights in the fictional
character or the personality of the real person in itself. It only safeguards the embodiment of such
a mark concerning the goods and services for which it is registered. Contracts usually lay the
boundary of such rights, and therefore, a license should incorporate the following details:
 The feature(s) of the character that has been licensed, like the name, image, etc
 The field of activity for which the character has been licensed along with the territorial
scope of exploitation
 The products or services for which the licensing has been acquired and the legal form that
has been used to gain licensing

5. It was visible in Twentieth Century Fox Film Corporation vs. South Australian Brewing Co. Ltd,
wherein an application for the use of the word 'Duff' for the brewery was sought by the producer
of the Simpsons television show. The said word was the drink used by the protagonist of the
show, and the producers had also granted licenses for character merchandising of the 'duff' beer.
Therefore, the court concluded that the brewery (defendant) had engaged in deceptive conduct,
and therefore, committed passing-off while making unauthorized use of the word in the
association of its breweries.
With the aid of the provisions within trademark legislation, often merchandising of non-fictional
characters is pursued by using either stage names or logos attached to their identity; for instance,
the serpentine mark to associate to the characters in Riverdale, the use of the 'tongue and lip' logo
by Rolling Stones, use of Lady Gaga by Stefani Joanne Angelina Germanotta.
Advantages of Character Merchandising
 For commercial commotion, it is necessary to attract consumers and generate awareness
of the products. With character merchandising, dual benefits are met. The audience either
recognizes the goods or services originating from a particular manufacturer, creating the
excitement of the product, or draws closer to the cartoon, film, character, or serial,
creating greater inclination for the same. Either kind of interest is a mode of mutually
nurturing both the endeavors, i.e., that of the proprietor of such creative rights or that of
the manufacturer or provider of goods or services.
 As noted above, merchandising of goods often depends on the negotiation of a contract of
license. By such virtue, there is a certain degree of royalty to which the proprietor of

6. creative works is entitled. The money raised thereof is an additional benefit to the pocket
of the proprietor. Another benefit is that the licensor has Trademark Protection that
prevents others from exploiting his logos or characters.
 It also enables a certain degree of quality control as to who uses the registered, licensed
mark concerning the goods and services and the quality thereof. The licensor can set
limitations and qualitative requirements required to make use of the mark within the
stipulated contract itself.
Legal Issues
Character merchandising is closely related to the rights of the performers, who, in this case, are
often celebrities. The rights of celebrities, including their right to privacy and controlling the
commercial use of their identity, are often in peril. Therefore, where unauthorized use of such
advertisements, movies, or pictures is made to pass off the goods or services of a third party, it
surely does also cause intrusion in the private life of such individuals. The choice of whether to
promote or not a particular product line should not be compromised as it has certain impacts not
only on the manufacturer of those authorized goods or services but also on the reputation of
those celebrities or renowned faces that aid in their promotion. The said issue is not always
addressed with the level of seriousness it deserves to prevent unfair business practices.
Concluding Remarks
Character merchandising is a known subject that has lately gained importance in the past few
decades and is still growing with the licensors being able to merchandise different aspects of the
characters. Therefore, in the current situation, with the absence of umbrella legislation to tackle

7. the issues emanating from character merchandising, the domestic laws will have to keep pace
with the changing nature of the said concept to prevent exploitation and unauthorized use of the
same.