Tag Archives: toy brand expert

How To Create & Build Brands In The Toy & Game Business

How To Create & Build Brands In The Toy & Game Business

There can be no doubt that the big money in the toy and games business comes from building and selling brands. Growing by acquisition is a proven formula for successful growth in this industry. Brands which get into retail each and every year also provide stability and security in a turbulent marketplace with massive annual product churn. It isn’t easy though to build a blockbuster toy or game brand, but here’s some thoughts on how to do it:

  1. Focus on building your own brands – this seems painfully obvious, but often companies get distracted by chasing easy win sales on licensed products or on jumping on saturated trends which will come and go leaving no ongoing legacy for the company. We need to do some of these things no doubt, because we need to generate revenue and pay our overhead, but while doing all this we also need to think about and ensure organisational focus on creating something ownable with longevity.


  1. Take a longer perspective – so often companies focus on the next annual selling cycle or even next quarter, but brand building takes tenacity and above all time. Some brands are flyaway successes from the start, but most take time to build. A good solid brand may take 5 years to build to maturity, so we might need to avoid heaping massive year 1 sales pressure on our own I.P. products. By focusing more on organic growth we can build brands and branded products with an upwards sales trajectory which will stick in market. If we follow the standard toy launch model of dump and run i.e. ship in as much stock as possible to retail and hope it sells through, then we are far more likely to kill our brands.


  1. Create compelling products with timeless appeal – there is a reason why certain things keep making a comeback i.e. Yo-Yos, fidget toys, slime/goo. That’s because the reasons why those toys were appealing in the past still apply. There are very few major brands in toys and games which don’t have really good products with proven play patterns.


  1. Create a clear, distinctive and ownable visual identity – to make brands ownable, you need distinctive visual identifiers i.e. logo, design style, fonts and all that good stuff. There are plenty of brands in the toy & game business which you would recognise just from a logo, design pattern or font.


  1. Use partnerships to level up your brands – for those trying to bootstrap their way up, partnerships can be really effective. A successful cross-promotional partnership benefits both sides and works best where there is an obvious fit between the products. For example, you can find Monopoly branded scratch cards in retail, which is an obvious fit with the classic Monopoly game brand being all about accumulating money. Needless to say, if you have a small hardly established brand you may not get a massive global deal, but with some ingenuity and persuasiveness you may be surprised what kind of partnerships you can create.


  1. Help your retailers build a point of differentiation – there are many retailers who hate having to sell the same products as the major mass market retailers who trash the price on everything and make it hard to maintain profitability. Can you find some exclusive iterations or brand extensions of your core products to help ensure retail support with smaller retailers who will better nurture your up and coming brand versus the mass market box shifters?


We run a Consultancy business helping toy & games companies get ahead. For more information, check out www.KidsBrandInsight.com/services

We also run a Strategic Sourcing Consultancy advising toy & game companies around the world on their Sourcing strategies, reviewing their vendor base & suggesting improvements. To date our Sourcing services have saved our clients $tens of millions. For more information on how we can help, just go to: www.ToyTeamAsia.com


Why Brands Are So Important For Toy Companies…

The recent announcement that Hasbro are to acquire Entertainment One in a $multi-billion deal brings a number of benefits to Hasbro. The acquisition of further expertise and capacity for content production and management can only help Hasbro’s ongoing journey from pure toy maker to entertainment brand owner. Above all though, this deal brings Hasbro yet another major global ‘toyetic’ brand – Peppa Pig.

Toy companies that don’t have strong brands of their own tend to either have to fight very hard to secure listings at retail and to drive product off the shelf into the hands of consumers and/or have to license other people’s brands to build an attractive toy product line.

Above all, the toy industry is about brands. Such a large amount of toy sales globally are driven by known brands which parents and kids know, love and trust. As a toy company then, why wouldn’t you want to build up your own brands instead of paying a 10-14% royalty to use someone else’s brands under license?

The challenge of course is that it takes time, money and resources to build up your own brands. It is much harder to persuade retailers and consumers to buy unknown brands, so in the end the process of building successful long term toy brands is part creative inspiration and even larger part sheer grind and ‘elbow grease’.

It takes organisational committment to build brands. Maybe you will be one of the lucky few who manage to create a massive global brand without a great deal of effort or time, but that isn’t likely! In the end a toy company needs to decide if they are willing to commit to building their own brands and paying the appropriate cost in terms of resources, effort and investment versus the quick (but transient) win of licensing someone else’s brands.

The benefits of having your own brands are many, but the major ones are firstly the tangible asset value, as evidenced in the Hasbro – Entertainment One deal, established brands with global presence can be worth $billions in hard cash! Secondly though, and perhaps this should be of more interest to toy companies who want to continue to trade is the stability created by having your own established brands. If you are reliant on licenses you inevitably end up on a vicious hamster wheel where you spin your wheels frantically to try to stay on the ride, but every so often due to a poor movie or a gap in licenses you end up getting spat out & taking a major hit in topline revenue. Most of us in this business have seen or experienced this effect of the downside of a major sales boost from a hit license then dying off leaving a massive sales gap to fill. This can often lead to redundancies and other turmoil which we would all choose to avoid where possible.

It isn’t just the major global players though who can build their own brands. All these companies started somewhere, in the shape of just one or two individuals who built a business from scratch. Smaller less established businesses of course can and do build major brands, and should be constantly striving to build the next new brand which can catapult them onto the next level.

Our Consultancy business offers a brand and product management service to toy companies. We have worked with $20bn global brand companies through to start ups. For more information on what we do and how we help toy companies around the world build brands, just click here to find out more: http://www.kidsbrandinsight.com/services/

Transformers 5 Disappoints: What Next For Hasbro?



It has been widely reported that Hasbro & their movie studio partners have a 10 year map for the Transformers franchise. This includes numerous additional Transformers films, plus an array of spin off movies. This should not be surprising, as this is increasingly the way blockbuster movies are going – extended franchises going ever deeper into each character’s story/background. X Men would be the most obvious example – with 10 (big box office earning) movies in the franchise since 2000, total box office gross of over $5bn, with a per movie average of over $500m.

According to media reports, Transformers 5 has been a major disappointment at the box office & in terms of critical reception. Yet the movie is still set to gross well in excess of $500m against a production budget of around $220m, and could even reach $600m at the global box office, putting it on a par with the franchise average of the X Men series. Admittedly this looks like being the lowest box office gross for the Transformers franchise since the 2007 movie, but $500-600m is hardly a disaster. It may be significantly less than expectations, and significantly less than the 2 previous movies which grossed over $2.2bn between them, but likely to be about on a par with X-Men Apocalypse, the last full ensemble X-Men movie which grossed c. $540m in 2016.

The question for Hasbro & their movie partners is whether Transformers 5 failing to live up to expectations is a reason to question the strategy/volume of movies & spinoffs planned going forward or not. As an acknowledged Hasbro expert (I worked for Hasbro for 6 years in the noughties & regularly advise investment companies on Hasbro’s prospects & outlook), I just can’t see how that would be the case for several reasons:

Hasbro & the movie people can’t afford for Transformers to fade from the movie scene, so you can be sure many of the top minds in the movie business will be on it to ensure future success.

While much has been made of Transformers 5 suffering from bad review/poor critical reception, the reality is that aside from the 1st in the modern franchise series in 2007, none of the Transformers movies have reviewed that well.

Spin offs allow franchises to have more frequent movies with less ‘franchise fatigue’ effect, as the story while being linked to the main narrative is different, the action is different, setting etc – for instance The Wolverine (2013) is a great example of a spin off which is unlikely to cause franchise fatigue – the setting in modern day Japan, the Yakuza, the particular ‘baddies’ etc. all significantly differentiate the movie from the main franchise, despite the lead character being one of the lead characters in the broader ensemble. So I would not expect the disappointment of Transformers 5 to have any impact on the forthcoming Bumblebee spin off (aside from much scrutiny from those at the top) to ensure the movie is a hit.

Licensing & merchandising is the big profit driver with this kind of franchise – the reality is that the movie has as much space on shelf as any other brand around the launch date. While this is outside Q4 peak season for toy sales, that means the licensed products almost sell themselves due to the noise around the release & the very prominent in store presence. Maybe this will wane more quickly in the run up to peak season than it might have done if Transformers 5 had been a $1bn grossing movie, but nevetheless, a disappointing movie doesn’t stop kids loving the concept, the characters and the past movies (these past installments of a franchise have never been more accessible with Netflix & other content platforms prevalent today). For sure, there’s likely to be a few less kids recruited into the franchise from Transformers 5, which has to be a concern, as kids are generally in the toy space for this kind of franchise for around 3-4 years max before moving on…yet there is the Bumblebee spin off movie in 2018, which is likely to do at least $300-500m at the box office, meaning the cumulative audience for both Transformers 5 & Bumblebee should be not far off the past smash hit sequels in the franchise. Therefore I see any financial impact as being short term – the franchise will keep going strong.

So, in conclusion, Transformers 5 may have disappointed based on sky high expectations, but $500m-600m is hardly a disaster, and still puts this movie on a par with the X Men series average box office.

N.B. All box office numbers quoted in this article are taken from: www.the-numbers.com


by Steve Reece, CEO of Kids Brand Insight www.KidsBrandInsight.com,  a leading toy expert consultancy to toy companies around the world, which helps people & companies to get ahead in the toy industry, find the right toy & game factories and to consumer research test their products with kids and parents. Steve is an acknowledged Hasbro expert, and regularly advises investment firms on Hasbro’s strategy & outlook via leading expert networks including Gerson Lehman & others.


A-Z Of The Toy Industry – B is for Brands!

A-Z Of The Toy Industry – B is for Brands!

The number one factor in the long term success of many toy industry heavyweights is BRANDS!

And more’s the point, not just any brands, but brands which are self owned/controlled i.e. not 3rd party license brands. Although 3rd party licenses are a huge part of the toy industry, self owned brands deliver stability, profitability, equity, extendabilty and security for toy companies.

But don’t just take my word for it…just take a look at the biggest players in the toy company. My ex-employer Hasbro has a weighty brand portfolio, including Transformers, My Little Pony, Play-doh, Monopoly, Trivial Pursuit etc. Mattel has Barbie, Hot Wheels, Fisher Price, Thomas & Friends etc.

And you don’t get bigger in toy brand terms than Lego – the ultimate toy brand. In fact, lego is probably the best example of a brand management driven company I can think of. If you look at Lego’s website, they have no fewer than 34 Lego sub-brands or co-brands, driving huge global toy sales in excess of $6billion – all from the foundation of a small plastic brick! The sheer brand extendability of Lego should be a case study for anyone serious about the toy business.

Smaller companies won’t have such brand behemoths in their portfolio, but critically they won’t ever get them if they just keep chasing the next hot license ad infinitum. Building brands can be slow, hard work – a fledgeling brand is a much harder sell than a proven hit license, but the long term bounty that established brands can deliver is priceless…

by Steve Reece, CEO of Kids Brand Insight www.KidsBrandInsight.com,  a leading Consultancy to toy companies around the world, which helps companies with product reviews & awards, find the right toy & game factories, consumer research test their products with kids and parents and secure export distribution/market entry around the world.