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Monopoly – THE Board Game & A Great Business To Boot!

MONOPOLY – THE BOARD GAME & A GREAT BUSINESS TO BOOT!

All puns aside (the more observant of you may have picked up on the Monopoly/boot link, groan!), Monopoly is THE board game that nearly all families buy for and play with their kids. Monopoly is a huge commercial success, and perhaps more impressively that success has been sustained and furthered over many decades.

Monopoly is more than just a game though, as well as being a cultural icon it also offers many interesting business lessons, both in terms of the game concept itself and in terms of the business that has been so successfully developed around the game.

In Episode 2 of our Playing At Business podcast, we take a close look at Monopoly from a business standpoint.

To listen in, just click here:

 

If you’d like to find out more about the podcast, you can visit the Podcast website here: www.PlayingAtBusiness.com

 

PODCAST TRANSCRIPT:

Playing at business with Steve Reece. The business podcast with a sense of fun. To find out more go to www.playingatbusiness.com

Hello and welcome to episode 2 of the playing at business podcast with me your host Steve Reece. Today we’re going to be looking at what the Board game Monopoly can teach us about real-life business.

 

Now nearly everybody has heard of Monopoly, nearly everybody has played Monopoly. It’s the ubiquitous board game. According to a quick bit of internet research on my behalf more than 250 million copies of the game have been sold. Although I actually suspect it might be more than that. But anyway that’s the best facts I can find online and it’s also reportedly been played by more than half a billion people. Again I suspect the real number is significantly more than that as well. But still that’s a huge huge set of metrics for what is not the newest of gaming genres. So I’ve counted roughly and I’ve come across at least a thousand versions of the game of Monopoly. Now I can’t think of many things where there’s more than a thousand versions. But Monopoly is obviously one of those and it’s a particularly personal story for me Monopoly in some ways and like most people because I loved playing board games as a kid, and I played Monopoly as often as I could as a kid. I remember playing a two day long game with one of my friends and we would take a break for tea and take a break for supper and then we go to sleep and then we’d wake up and play it. When one of us went out of the room to go to the bathroom, one of us would steal maybe a 500 note or a hundred note and that’s all the fun of playing Monopoly! Later on in life in the early noughties in fact, I was lucky enough to somehow end up as the European brand manager for Monopoly and that was a fantastic job – one of the best I’ve had.

I was fortunate enough to work with some really good people and together we developed & launched lots of different versions of Monopoly, which allowed me to gain a higher profile, to spend quite a lot of money on marketing collateral development and advertising, yeah quite an experience. I also led a team who launched a concept called My Monopoly, which at the time was cutting-edge. We’re talking about I’d say roughly 2001. My Monopoly was a customized Monopoly board game where you would fill in the street names using your own text online and order via the internet. which at that point in time was about as cutting-edge as technology could get apparently, or so the web development agency told us at the time and judging by their fees! It was a great deal of fun to work on that project. In fact one of my most vivid memories in toys was sitting in a room brainstorming the list of words which would have to be screened out, because of appropriateness or being too sweary for a family board game – that was definitely not a dull meeting!

 

So I do have some personal history with the Monopoly board game both personally and professionally. I won’t however be giving away any trade secrets and so my. Frankly not that I really know any that would still be relevant now anyway nearly two decades later anyway! But I will be looking at what businesses in general can learn from the story of Monopoly the brand, and from the game itself.

So just a quick snippet of history. A similar game to what we now see is Monopoly existed around the turn of the 20th century, called ‘The Landlord’s Game’ and it was actually created as a game to show that trying to create monopolies was wrong, I believe from what I have read that the game author thought Monopolies were not a constructive way for society to be organized. So this game was around for a couple of decades actually and then a traveling salesperson called Charles Darrow repackaged/tweaked the formula & changed the emphasis to actually aspiring to a monopoly,  and started to sell the game under the brand name of Monopoly. He started to do pretty well with it and eventually licensed it to Parker Brothers. Now in the height of the Great Depression when money was really tight across America and obviously there was a lot of destitution, I guess money was the national topic during that period. Between Charles Darrow and Parker Brothers they sold more than one-and-a-half million copies in the year which is a phenomenal amount, and by the way that’s just in the USA. So obviously the heritage of Monopoly the game goes a long way back and this is one of the big things you’ll find with a lot of brands which have survived the test of time. Their history maybe started in different times, they have to evolve and adapt in order to stay relevant for today and Monopoly is a brand that’s done that particularly well. So I’m not here to talk about the specifics of Monopoly the board game. Although we could do that. We could look at your best chances of winning. We could talk about how people love to cheat when they play Monopoly. We could also talk about some family arguments when people play Monopoly (!). But that’s not what we’re here to do. We’re here to look at the business lessons from this amazing brand.

So lesson number one for me from Monopoly is you won’t get a more powerful brand than Monopoly in a couple of ways. So firstly, it’s hugely extendable. It’s what I would describe as a platform brand – I guess in a slightly similar way to the Lego brand which we looked at in the last podcast. So you can overlay whatever theme, whatever license, whatever location you like onto Monopoly and the game itself will still work. So in a way you’re not restricted to just one iteration. That’s how you create huge brands by creating something which you can extend sideways and upwards and just stretching in general. I think also in terms of brands,  identifying/ownable factors is a primary consideration. And Monopoly is so distinctly Monopoly in terms of branding and iconography. Which A, makes a brand legally protected for a start. but B, also gives it a kind of consumer recognition in which helps to keep selling products based on that brand or derive from that.  The look of the board, the Monopoly brand itself, Mr. Moneybags the brand mascot are all really good factors which make for a really really strong brand identity and then I guess the other thing which you’d have to say is over time this has had to evolve still. Design has changed, the same Monopoly game that looked right for the times thirty years ago, maybe even a bit longer when I started playing or even 50 years ago.  That same look would not work today. So over time it has evolved and again that’s another indication of a really strongly managed brand.

I think the other thing which is really interesting for me about Monopoly is it is a global phenomenon. Now for those of you who don’t know very much about board games, board games in general are a cultural product. It’s a reflection of some kind of cultural element.  It’s a social experience more than anything and so you do find that board games tend to vary a little bit by market, because the culture varies from market to market. So without getting too geeky on this subject, Germany would tend to have much more in depth more strategic games. UK likes shorter games, especially games based on game shows. There are different gameplay types and genres that work to a degree better in each market. However there are some products and some brands in which seem to usurp all that and Monopoly is definitely one of them. In nearly every market you can find, you’ll find that Monopoly works as a board game and actually one of the more interesting things is to see having rolled out to those few new markets that haven’t had it in the last couple of decades and to see it working even as well there is a new introduction in most cases in the vast majority of countries and the interesting thing is in terms of the brand actually I always talk about purchase pattern and purchase dynamic.

 

I think a lot of businesses forget that you’re looking for a replicable formula. okay so if you’re selling, I don’t know if you’re selling soft drinks you have a particular consumer and you have a particular purchase dynamic and you better know what that pictures dynamic is if you expect to be able to sell more to them. If you expect to know what the right messages are for your communications and I think one of the interesting things with Monopoly is the nostalgia factor. So parents tend to introduce their kids to Monopoly because they played with Monopoly when they were kids themselves and so you get this rose-tinted spectacles perspective.  I remember the game I mentioned where I played it for two days with a friend of mine. I mean that’s like a gold memory and so parents will introduce the game to their children from this frame of reference with a real sense of reverence & this is something special I’m about to introduce to you. Therefore it’s quite a strong emotionally driven purchase and also experience to introduce your child to the Monopoly board game for the first time and I think that’s the biggest thing you’ll find about most successful brands in whatever industry. If you look at apple, if you okay Coca Cola, if you look at fashion brands. It’s actually that emotional reaction, the affinity that people have which tends to guarantee huge sales and also longevity.

So moving on to the business of Monopoly, it’s no secret that Monopoly is one of the top-selling board games if not the top-selling board game depending on how you define board games.. I think the other interesting thing though which a lot of people would not necessarily know is that there are numerous multi-million dollar companies around the world whose core business model is producing Monopoly versions under license from Hasbro, the brand owner. So effectively Hasbro is gaining revenue from niche items that they wouldn’t otherwise necessarily get around to looking at.  It doesn’t make sense for a major global company like Hasbro to look at very small sales opportunities. but perhaps it does make sense to bundle all that up into a partnership for North America or for the UK, or Germany etc. Hasbro and their partners have clearly & reportedly done really well with that business model.

 

Lesson number two from this podcast is that successful companies build and leverage brands.  They don’t just sell products. They build brands and then they leverage them and if they can’t find good ways to exploit opportunities themselves, they find third parties to help them do it to help them monetize the brands. So with Monopoly in particular you would be able to find a multitude of digital versions. You’d find some gaming versions, like I said you find the local edition. So wherever you’re sat right now, the odds are if you’re in a major Western market, there’s a local Monopoly version not too far away from you. so yeah so I think it is really important to acknowledge that sometimes companies can’t do everything themselves and actually the kind of the success factors is to not take on opportunities that A, don’t make sense in terms of the scale of them for your operation. But also that you really can still leverage these opportunities via partnerships and that’s a critical thing in business in general.

The third lesson from Monopoly is that it has already been around for more than 80 years and it kind of has proven its longevity & also its timeless appeal. Even in this day and age of social media and changing consumption of content and just all these things that have changed in the last decade or two, Monopoly is still succeeding.  Today’s generation of kids has complete screen time overload, so Monopoly still is relevant as it ever has been in the sense that today’s parents want to find antidotes to all that screen time for their children and it seems pretty clear that Monopoly will pass through to these next generations and obviously the graphics will need to be changed as design styles evolve and also the themes and the licenses. What we see today may not be the same themes and licenses that will be around in ten or twenty years’ time. But what you can absolutely guarantee is that Monopoly, the board game will still be here. Monopoly the brand will still be here and that’s a huge lesson.  It’s so difficult sometimes to build things up to any scale. So if you build something up for a flash in the pan, it’s a lot of work for a very short period of payback I guess, versus finding a perennial hero like Monopoly.

And then I guess the business lesson which is perhaps slightly outside of the scope of this podcast really. But I think it is worth recognizing is the gameplay premise of Monopoly itself. There are many things that we might want to teach our children and the first thing that Monopoly and also other board games which include money helps to do is to get children used to the concepts of money and to playing with money and to count and to try and understand that people in the world may try to take financial advantage unless you’re relatively savvy. But I think more than that actually there’s quite an advanced lesson in the gameplay of Monopoly in terms of how to invest especially in real estate and to buy property, to charge rents, to manage cash flow versus investments and also to do all of that in a really competitive situation where you can kind of risk losing it all. So yeah that’s kind of the fourth ‘business’ lesson that I would identify within Monopoly.

Just before I move on to the summary, I think one of the questions I have been asked most often is what’s my favorite version of Monopoly myself having interacted with it over such a long period time and I’d have to say there’s a Disney version of Monopoly that I worked on which launched in roughly 2000 or 2001. That was a great product, aesthetically possibly the most beautiful product I’ve worked on, very glitzy and quite an experience. A learning experience for me to work on with a great team and a great success commercially as well. So there you go, for anyone who was interested that’s my personal favorite version of Monopoly! So to summarize now I guess I would say that Monopoly is clearly a global cultural icon, but actually more than that, it’s a thriving business model in its own right and there’s a lot that we can learn from Monopoly. But just to reiterate the key lessons I see, the first thing is the importance for businesses to try or to strive to build timeless brands and to manage them well.  We can learn a lot from how Hasbro have managed Monopoly successfully for longevity despite these changing times. We can learn from how they’ve set up to deliver revenue from their brand intellectual property by a third-party partnerships where it wouldn’t have made sense for them to do it themselves. And of course there’s the final lesson, the embedded lesson in terms of a beginners guide to how to invest in property. So that’s Monopoly. We will be doing more in this series. So please stay tuned. Please give us a review if you like this. If there’s anything in particular you’d like us to cover on future podcasts, please do feel free to get in touch…and that’s all for now. Thanks and bye.

Playing at business with Steve Reece. The business podcast with a sense of fun. To find out more, go to www.playingatbusiness.com  [Music]