Has­bro earn­ings surge as movie tie-ins give it edge over Mat­tel

New Straits Times - - Business -

NEW YORK: Spi­derman, Thor and Princess Leia are gang­ing up on Bar­bie in a bat­tle for Amer­ica’s in­creas­ingly tech-fo­cused toy in­dus­try play­ground.

Has­bro, long a dis­tant sec­ond to Mat­tel, maker of the iconic Bar­bie dolls, passed US$5 bil­lion (RM21.61 bil­lion) in an­nual rev­enues for the first time last year and topped its ri­val in first-quar­ter sales.

Has­bro’s surge is due in large part to snatch­ing Dis­ney’s lu­cra­tive “Princess” and “Frozen” fran­chises from Mat­tel last year ain a shift that was an­nounced in 2014.

The com­pany also amassed a large ad­van­tage in toys con­nected to up­com­ing movie re­leases in­clud­ing the lat­est in­stal­ments in the block­buster “Trans­form­ers”, “Thor” and “Spi­derman” series.

The movie jug­ger­naut cul­mi­nates in De­cem­ber with “The Last Jedi,” part of the iconic “Star Wars” series, a re­li­able cash cow, not only be­cause of its cross­gen­er­a­tional ap­peal, but be­cause it fea­tures prom­i­nent male and fe­male char­ac­ters.

“They just have block­buster af­ter block­buster,” said Keith Sny­der, an eq­uity analyst at CFRA.

He noted that smart­phones and other tech­nol­ogy al­low toy­mak­ers to mon­e­tise the fran­chises far be­yond the lim­its of old­fash­ioned ac­tion fig­ures.

“They’re play­ing with the ‘Star Wars’ fig­ures, watch­ing the ‘Star Wars’ movie, see­ing the ‘Clone Wars’ car­toon and then play­ing ‘Star Wars’ on their mo­bile phone,” Sny­der said.

“Keep­ing them tied into ‘Star Wars’ drives more sales.”

Mat­tel’s movie-linked of­fer­ings, which in­clude “Cars 3” and “Won­der Wo­man,” are fewer and less lu­cra­tive, an­a­lysts say.

Has­bro, whose best-known brands in­clude “Play-Doh” and “My Lit­tle Pony,” also is in­tro­duc­ing more toys that in­cor­po­rate newer gad­getry, such as a Nerf blaster drone that car­ries a cam­era and lets kids mon­i­tor move­ments on a screen and fire darts from re­mote lo­ca­tions.

Another new toy is the “Fur­real” a ready-to-as­sem­ble puppy robot that per­mits chil­dren to se­lect fur colour and bark sound among other com­mands through a down­loaded app.

The toy also in­cor­po­rates cod­ing pro­grams, another sell­ing­point in to­day’s high-tech mar­ket.

“Tech-ori­ented toys and un­plug­ging are not mu­tu­ally exclusive,” said Has­bro pres­i­dent John Fras­cotti.

“Our mission is to de­liver the world’s best play ex­pe­ri­ences, and that of­ten in­volves both tech­nol­ogy and cre­ative play.”

Mat­tel also has boosted its em­pha­sis on tech­nol­ogy, part­ner­ing with the ABC broad­cast net­work on a re­al­ity com­pe­ti­tion series in which in­no­va­tors pitch ideas to a panel of chil­dren judges.

Mat­tel sig­nalled an even greater fo­cus on tech­nol­ogy in Jan­uary when it named Google Amer­i­cas pres­i­dent Mar­garet Ge­or­giadis as its new chief ex­ec­u­tive.

The ap­point­ment raised ex­pec­ta­tions that Mat­tel will in­tro­duce more toys that tra­verse the vir­tual and real worlds, per­haps by in­clud­ing a free “we­bisode” or another down­loaded item with pur­chase.

“Ana­log toys don’t have the same stay­ing power as they once did,” said Morn­ingstar analyst Jaime Katz. AFP

BLOOMBERG PIC

Has­bro, long a dis­tant sec­ond to Mat­tel, maker of the iconic Bar­bie dolls, passed

US$5 bil­lion in an­nual rev­enues for the first time last year.

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