Going Beyond the Box Office to Belonging

How Stories Can Become Merchandise Empires that Ratify Belonging

It Started with a Cartoon Mouse

Walt Disney understood the commercial potential of storytelling long before anyone had heard of George Lucas or the Minions.

In 1929, Disney was in New York when a businessman approached him about putting Mickey Mouse on children's writing tablets. The offer was $300, and Disney accepted because he and his brother Roy needed the money.

It was a modest transaction that helped launch what would become one of the most extraordinary licensing businesses in entertainment history.

Disney had introduced Mickey Mouse to audiences the previous year, and the character was rapidly becoming a cultural phenomenon. Within a few years, Mickey appeared on dolls, watches, clothing, books and countless other consumer products.

In 1932, Disney brought in licensing entrepreneur Kay Kamen to organize and expand the business. Kamen recognized that Disney's characters had commercial value beyond the cartoons and established a licensing operation that helped transform the company.

By 1933, Disney-branded merchandise was generating millions of dollars in retail sales. A Mickey Mouse wristwatch introduced that year became a sensation, helping establish the character as a commercial property with an identity independent of his appearances on screen.

Disney's genius was not simply recognizing that people would buy products featuring characters they loved. He understood that those characters could sustain relationships with audiences across generations. It could build connection and community. 

When Disneyland opened in 1955, Disney took the concept even further by creating a place where audiences could physically enter the worlds they had experienced through his stories. Entertainment, merchandise and experiences became interconnected parts of a growing business.

Today, the company that began with a cartoon mouse operates theme parks, resorts, cruise ships, retail businesses and licensing partnerships around the world.

Disney's fiscal 2025 financial report illustrates the scale of that evolution. The company's Experiences division generated more than $36 billion in annual revenue, including approximately $4.4 billion from merchandise licensing and retail operations.

Those figures don't capture the full retail value of products sold by Disney's licensees, but they demonstrate how important the business beyond the screen has become.

The cartoons created the characters. The characters helped build the empire. The empire ratifies belonging on a global scale. 

A Galaxy of Merchandise

I experienced the power of entertainment merchandising firsthand as a child growing up in the 1970s. From Saturday morning cartoons to the stories that made me fall in love with filmmaking.

Like millions of kids, I was captivated by superheroes, Star Wars and Battlestar Galactica. Watching those stories was only part of the experience. I wanted the action figures, spaceships and other toys that allowed me to recreate the adventures and imagine new ones.

I could become part of the story rather than simply watch it. I could play, imagine, and make believe…be transported away to a galaxy far, far away if my mom parted with a little cash. 

When George Lucas released Star Wars in 1977, he helped transform that childhood impulse into one of the most successful merchandising businesses in history.

Lucas recognized that the characters, vehicles and fictional universe he had created could have commercial value far beyond the film itself. His negotiations with 20th Century Fox reflected an unusually strong interest in retaining control over the underlying intellectual property and its future commercial opportunities.

The familiar Hollywood legend suggests that Lucas simply traded a portion of his compensation for all the merchandising rights before the film's release. The actual history is more complicated.

Fox initially administered licensing for the original film, while Lucas retained approval rights and negotiated a broader ownership position. When the parties renegotiated their arrangements in 1979, Fox relinquished its licensing rights to Lucas.

That illustrates how valuable rights can become as a creative property develops. Lucas's determination to retain control over the universe he created ultimately gave him opportunities that extended far beyond the original production.

The toy company Kenner acquired the license to produce Star Wars action figures, but the film's extraordinary success created an unexpected problem. Kenner couldn't manufacture the toys quickly enough to satisfy demand for Christmas 1977.

Its solution was remarkable. Rather than sell the action figures themselves, Kenner sold an Early Bird Certificate Package that promised children the first four figures when production caught up with demand.

Parents were effectively buying the promise of toys that didn't yet exist.

The promotion worked because audiences had already developed such a strong emotional connection to the characters and the universe Lucas created.

Over the following decades, Star Wars expanded into an enormous commercial ecosystem encompassing toys, books, games, apparel, collectibles, television series, theme park experiences and additional films. Partnerships with companies such as LEGO introduced the franchise to new generations of fans.

The commercial success of Star Wars demonstrated that the theatrical release could serve as the foundation for a business with a much longer lifespan than the movie itself.

For Lucas, the most consequential decision wasn't simply making a successful film. It was preserving the ability to participate in the value that film would create over time.

The Minions Phenomenon

The little yellow characters that David Steward II told me about represent a contemporary expression of the same principle.

Introduced in the 2010 film Despicable Me, the Minions became enormously popular despite speaking a largely nonsensical language and originally serving as supporting characters.

Their distinctive appearance, physical comedy and playful personalities made them immediately recognizable to audiences around the world. They were particularly well suited to merchandise because their appeal transcended language and cultural boundaries.

The franchise subsequently expanded through sequels and standalone Minions films. By April 2025, the six films released through 2024 had generated more than $5.6 billion in worldwide theatrical box office receipts.

That figure alone would make the franchise an extraordinary success. Yet theatrical revenue represents only part of its commercial footprint.

Minions appear on toys, clothing, school supplies, household products and countless other licensed items. They have become attractions at Universal theme parks and continue to reach audiences through partnerships and promotional campaigns.

The precise lifetime retail sales of Minions merchandise are difficult to establish from publicly available reporting, so it would be misleading to claim definitively that merchandise has generated more revenue than the films. Nevertheless, the franchise provides an excellent example of how entertainment companies develop characters with commercial lives that extend well beyond their original stories.

David's interest in children's entertainment made sense to me then, and it makes even more sense today. Children are naturally drawn to imaginative play. They want to recreate what they see, assume the identities of their favorite characters and invent adventures of their own. As a parent, I watched that same phenomenon unfolds with another generation.

The toys are more than souvenirs of an entertainment experience. They become tools that allow children to participate in the storytelling.

That participation helps explain why children's programming and consumer products have been so closely connected for decades. The relationship between the entertainment and the merchandise can reinforce itself, keeping characters relevant between new releases while creating opportunities for additional stories. It is the same phenomenon with sports memorabilia. 

The Business of Belonging

The merchandising phenomenon is not limited to children's entertainment.

In fact, I came to understand many of the same principles during my years working in Major League Baseball.

Professional sports teams operate businesses built around powerful emotional relationships with their fans. Those relationships extend far beyond the games themselves through sponsorships, broadcasting, licensing, merchandise, memorabilia and experiences.

During my time with the St. Louis Cardinals, I helped develop Cardinals Authentics, a business focused on bringing fans closer to the team through authentic memorabilia and collectibles.

The appeal of a game-used baseball, an autographed jersey or a piece of memorabilia from an important moment in franchise history is not necessarily the object itself. Its value comes from the connection it represents.

A fan who purchases a game-used baseball is acquiring something tangible from a moment that matters to them. The object becomes part of their personal connection to the team and its history.

The same principle applies when someone purchases a movie poster, wears a shirt featuring a favorite character or displays a collectible from a beloved television series.

These products allow people to express their interests, celebrate their affiliations and share something about themselves with others.

Merchandising also creates opportunities for commercial partnerships that can benefit both the entertainment property and the companies selling the products.

Disney's longstanding relationships with companies such as McDonald's demonstrate how promotional partnerships can introduce characters to enormous audiences while supporting the marketing of new entertainment releases.

The business is built around a simple understanding of human behavior. People develop emotional attachments to stories, characters, teams and ideas. When those connections become meaningful, people often want something tangible that allows them to express that relationship.

They want to belong to something.

A $161 Billion Business

The size of today's licensing industry underscores how important these relationships have become.

According to Licensing International's 2026 Global Licensing Industry Study, worldwide retail sales of licensed merchandise and services reached approximately $389.8 billion in 2025.

Entertainment and character licensing accounted for $161.8 billion of that total, making it the largest category of licensed intellectual property. Sports licensing represented another $44.4 billion.

These figures represent retail sales generated by licensed properties, not the revenue or profit received by the underlying rights holders. Nevertheless, they illustrate the enormous economic activity associated with stories, characters, brands and fan relationships.

What is particularly interesting is how licensing allows an intellectual property owner to participate in markets without necessarily becoming a manufacturer or retailer.

A filmmaker or studio that controls the appropriate rights can authorize another company to manufacture and sell products based on its characters or creative properties. Depending on the agreement, the rights holder may receive royalties, guaranteed payments or other compensation.

The licensee assumes responsibility for some or all of the manufacturing, distribution and retail operations, while the intellectual property owner retains contractual control over how its property is used.

Of course, the economics vary significantly. Licensing agreements involve complicated questions about ownership, territory, product categories, quality control, exclusivity and compensation.

The essential lesson is that intellectual property can create opportunities across multiple markets when the rights are properly understood and protected.

What Independent Creators Can Learn

It would be unrealistic to suggest that every independent filmmaker should expect to build a merchandising empire.

Most independent productions will never generate the audience demand necessary to support a substantial consumer products business. Even when demand exists, manufacturing costs, fulfillment, marketing and licensing arrangements can make merchandise less profitable than it initially appears.

But I believe there is an important lesson in the way Disney, Lucas and other successful entertainment entrepreneurs have approached the development of their creative properties.

They understood that the underlying intellectual property could have value beyond the initial production. That principle is just as relevant to an independent filmmaker developing a documentary as it is to a studio producing an animated franchise.

A compelling documentary might inspire a line of merchandise connected to its subject or central message. A filmmaker might use collectibles or limited-edition products to support fundraising, build awareness or create additional engagement with an audience.

A writer might develop products associated with a book or the ideas that inspired it.

In some cases, merchandise may generate meaningful revenue. In others, its greater value may come from strengthening the relationship between creators and the people who appreciate their work.

Neither opportunity should be overlooked.

For independent creators, this also reinforces the importance of understanding what they own and what they are agreeing to give away.

A filmmaker who sells or licenses distribution rights should understand whether the agreement also includes merchandising, promotional or other ancillary rights.

A creator developing a property based on someone else's life or experiences must consider whether the necessary rights extend to commercial products, including any applicable name, image, likeness or trademark rights.

Those questions are easier to address during development than after a project becomes successful.

I have increasingly come to appreciate this as STORYSMART has evolved from a company focused on helping people develop and protect their stories into an independent media enterprise developing and producing its own intellectual property.

My experience in baseball taught me the value of cultivating relationships with audiences. My experience as a filmmaker has reinforced the importance of protecting the rights associated with creative work.  Together, those lessons have shaped how I think about building a sustainable independent media business.

The Story Doesn't End on Screen

Every time I look at the Minion sitting on my desk, I think about that conversation with David.

His advice to stay focused on intellectual property was rooted in an understanding of how entertainment businesses create lasting value. The opportunity isn't necessarily limited to producing something that audiences will watch. It includes recognizing what audiences may want to do with the experience afterward.

Disney understood that nearly a century ago when he accepted $300 to put Mickey Mouse on a writing tablet. George Lucas demonstrated it when he fought to retain control over the commercial opportunities associated with Star Wars. The creators of the Minions continue to demonstrate it through characters that have become part of popular culture around the world.

For independent creators, the lesson is not to imitate the scale of those businesses. It is to recognize that a story can create value in ways that extend beyond the medium in which it is originally told.

The most enduring stories become part of people's lives. They inspire imagination, create connections and give audiences something they want to carry with them.

Sometimes, quite literally.

And sometimes, that something is a little yellow Minion sitting on a desk, reminding a filmmaker to think beyond the screen to ratifying belonging.

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About Ron Watermon

Ron Watermon is a creator, builder, filmmaker, media entrepreneur, and the founder of STORYSMART. He writes about professional storytelling, media entrepreneurship, filmmaking, and the business of turning stories into valuable assets.

Ron is the author of STORYSMART Storytelling for ALL and is currently building STORYSMART STUDIOS, an independent media company dedicated to developing profitable, enduring original media properties.

About Our STORYSMART® Perspective

At STORYSMART, we approach storytelling, filmmaking, and media development as a long-term, rights-first business rather than a project-by-project creative exercise.

Our focus is on understanding how stories create value over time through ownership, disciplined development, audience relationships, and thoughtful risk management.

The articles, commentary, and educational materials published here are intended to contribute to broader conversations about storytelling, media, and intellectual property. They are provided for informational and educational purposes only and should not be construed as investment, legal, tax, or financial advice.

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