The State of the Toy Business.

[Sky Shadow]

http://www.takefiveaday.com/2014/07/13/the-state-of-the-toy-business-2014-hey-is-that-a-cliff/

Some interesting thoughts in this article. The most pertinent ones for us are:

"While Transformers, the movie is doing fine – the toys are stacked to the gills and selling at a slow pace... And if you can’t sell Transformer toys with a giant movie opening, you cannot sell toys... AND if you can’t sell trucks or robots that change into dinosaurs, there is big trouble in toyland.

The #1 licensed toy line in America usually generates about $400-$500 million in sales a year... At the rate the toys are selling, Transformers might still crack $225 million which is a lot but when you create inventory to sell $500 million dollars worth of toys? That’s not so good – plus all the 2nd and 3rd waves they were expecting to sell. So, get ready for some massive markdowns and serious re-packing … so wait for the sales and markdowns (and pick up the wave #2 & #3 releases for sales stock as they won’t get as much distribution). :-)

Last year, toy sales were down 9% in the US which is obviously not good BUT the worse news is if you took out LEGO, toy sales are down 17%!"

[i_amtrunks]

Not sure if it applies everywhere, but the kids in my family and at the school I teach in, toys don't cut the mustard as much anymore.

Sure kids still want their dolls and nerd guns and the odd big item, but they mostly want technology, phones, iPads, video games etc.

Plus when you look at the crap on the shelves (most of the tf section seems to be filled with terrible looking Titan figures!) it can be quite daunting. Add to that the focus on Prime and Bumblebee has backfired, you can only sell two characters so many times. G1 worked so well as there were hundreds of different characters for kids to find a favourite in.

[griffin]

That commentary on Transformers was true for the last three years, starting with the massive amount of toy stock warming shelves in 2011 for DOTM, but this year Hasbro (or the retailers) have been smarter with less stock but more variety... and it worked, as we've already been seeing wave 2 stock coming through just before the movie came out.
Most of the stuff I'm seeing sitting in stores (here and America) are the gimmick items, which will be good for us older collectors, as Hasbro should see that as justification for a readjustment of the ratio a little back in our favour.

[5FDP]

It still amazes me that they have a toy line for what is in essence an adult / mature rated film :confused: I know that Spike said that word 'shit' in TF:TM, but that's not even in the same ballpark as 'how do you say get the f@#k out of the way in Chinese'. I wouldn't take my 10 year old to see it (for the record, my kids are younger anyway) and therefore wouldn't expect him / her to want any of the toys. IMO, it's the parents pushing the toys on their kids, but after 4 movies over 7 years, it's the parents who have gotten over it. If the movies were aimed at a younger age bracket, then it would allow the franchise to grow with them bringing in new young fans every time a movie is released. Personally, I wouldn't mind a PG Transformers movie because in reality, TF:TM is still the best, even without the added swearing, ass shots, dirty jokes etc. :cool:

[ComicGuy89]

It still amazes me that they have a toy line for what is in essence an adult / mature rated film :confused: I know that Spike said that word 'shit' in TF:TM, but that's not even in the same ballpark as 'how do you say get the f@#k out of the way in Chinese'. I wouldn't take my 10 year old to see it (for the record, my kids are younger anyway) and therefore wouldn't expect him / her to want any of the toys. IMO, it's the parents pushing the toys on their kids, but after 4 movies over 7 years, it's the parents who have gotten over it. If the movies were aimed at a younger age bracket, then it would allow the franchise to grow with them bringing in new young fans every time a movie is released. Personally, I wouldn't mind a PG Transformers movie because in reality, TF:TM is still the best, even without the added swearing, ass shots, dirty jokes etc. :cool:

I have to agree with this. A TF movie that is more kid-friendly will be right up my alley. It doesn't even have to be childish, just less edgy.

[Jinto]

I agree wholeheartedly.

To be frank though, the quality of figure being put out for this movie is kind of appaling. Who in their right mind would pay $80-100 for that leader class Prime? Too many of the items look cheap and junky.

And part of the blame has to come from their release strategy. You see it with every movie - Begin the release a few good figures and a lot of 'chaff' that they know people won't be as excited for in the long run. They hope that by the time you've seen the movie and know which figures are cool/desireable you've already bought the less popular ones and will fork out for the stars of the show. The trouble is, this time far fewer people took the bait and it's hurting their bottom line. It also hurts us because the few figures that people are waiting for (Stinger, for example) are in danger of cancellation.

For the record I enjoyed TF4.

[drifand]

Masterpieces are gone, so they should have known the trick and release movie masterpiece and sucker all of us easily with $150 each, unfortunately they didn't. oh well.

[Gouki]

It still amazes me that they have a toy line for what is in essence an adult / mature rated film :confused: I know that Spike said that word 'shit' in TF:TM, but that's not even in the same ballpark as 'how do you say get the f@#k out of the way in Chinese'. I wouldn't take my 10 year old to see it (for the record, my kids are younger anyway) and therefore wouldn't expect him / her to want any of the toys. IMO, it's the parents pushing the toys on their kids, but after 4 movies over 7 years, it's the parents who have gotten over it. If the movies were aimed at a younger age bracket, then it would allow the franchise to grow with them bringing in new young fans every time a movie is released. Personally, I wouldn't mind a PG Transformers movie because in reality, TF:TM is still the best, even without the added swearing, ass shots, dirty jokes etc. :cool:

As opposed to say the Alien, Predator and Terminator franchises? Rambo? Various horror movies? Movies have always had toy lines somewhat inappropriately, and I'd say those movies are far worse than any of the TF ones.

[nexusnixx]

Never fancied movie related tfs at all. Lots of hype about it but soon enough it's just nose dives.

I think the really popular movie tied in toys will be the minions.

[5FDP]

As opposed to say the Alien, Predator and Terminator franchises? Rambo? Various horror movies? Movies have always had toy lines somewhat inappropriately, and I'd say those movies are far worse than any of the TF ones.

IMO the big difference here is that Transformers started out as a toy line aimed at children. The movies followed.

[kup]

I think toy interest is down not so much because kids have changed and wouldn't be interested but because there isn't really much that is actually worth being excited about any more. Naturally a kid would say that toys are lame because he is growing up in an era where most of them are indeed lame.

Just look at the rubbish that is on the shelves now.

On the other hand, Lego seems to be doing alright and so a girl toys apparently - Just Mattel mishandling the market as they usually do. It's just the action figure/Boy's toys which are suffering because their quality and innovation have deteriorated to a point not even kids want them.

Also the 'medium' promoting the toys isn't that great. We haven't had a good Transformers cartoon that becomes a sensation in a very long time (I think Beast Wars was the last one? Other cartoons did ok but didn't stand out above most as a whole) and Bay movies despite 'mixed perceptions' seem to be a 'watch and forget' affair and you need enduring appeal to sell toys.

[Alpha Supreme]

As an adult fan I'm crying out for Masterpieces... hoping that HASTAK will do more and release them in Australia. Also as an adult who loves Transformers I have influenced my nieces and nephews when it comes to their choice of toys... engage the adult as well as the child and you have a winner.

[millhouse]

As an adult fan I'm crying out for Masterpieces... hoping that HASTAK will do more and release them in Australia. Also as an adult who loves Transformers I have influenced my nieces and nephews when it comes to their choice of toys... engage the adult as well as the child and you have a winner.

When they're significantly more expensive (Prowl) or difficult to find (Soundwave), you might as well collect the Takara ones, which are easier to get hold of, generally with more accessories available (even if they're Amazon exclusives in Japan), often with higher quality paint/quality control (compare the recent Grimlock re-releases from Hasbro and Takara).

[kurdt_the_goat]

When they're significantly more expensive (Prowl) or difficult to find (Soundwave), you might as well collect the Takara ones, which are easier to get hold of, generally with more accessories available (even if they're Amazon exclusives in Japan), often with higher quality paint/quality control (compare the recent Grimlock re-releases from Hasbro and Takara).

Seriously! Someone at Nexus was selling a TT Prowl for $75 and got haggled down to even less. Buyer went off to get the money and i remarked to the seller "You should have kept it $75 and told him to visit TRU and pay $100 if he doens't like it!"

[millhouse]

Seriously! Someone at Nexus was selling a TT Prowl for $75 and got haggled down to even less. Buyer went off to get the money and i remarked to the seller "You should have kept it $75 and told him to visit TRU and pay $100 if he doens't like it!"

The quality, pricing, and availability is exactly why most of my MP collection has become Takara.

Even when they're pricey, they don't have the issues I've seen on some Hasbro stuff. That being said, my Hasbro MP-10 and Thundercrackers are perfect.

[Omega Metro]

I think toy interest is down not so much because kids have changed and wouldn't be interested but because there isn't really much that is actually worth being excited about any more. Naturally a kid would say that toys are lame because he is growing up in an era where most of them are indeed lame.

Just look at the rubbish that is on the shelves now.

On the other hand, Lego seems to be doing alright and so a girl toys apparently - Just Mattel mishandling the market as they usually do. It's just the action figure/Boy's toys which are suffering because their quality and innovation have deteriorated to a point not even kids want them.

Also the 'medium' promoting the toys isn't that great. We haven't had a good Transformers cartoon that becomes a sensation in a very long time (I think Beast Wars was the last one? Other cartoons did ok but didn't stand out above most as a whole) and Bay movies despite 'mixed perceptions' seem to be a 'watch and forget' affair and you need enduring appeal to sell toys.

Agree that today's toy lines are crap. Why isn't MOTU as 'mainstream' as Star Wars or Transformers these days?

[millhouse]

Agree that today's toy lines are crap. Why isn't MOTU as 'mainstream' as Star Wars or Transformers these days?

Because holy sh-t was that Dolph movie TERRIBLE! :P

[Omega Metro]

Because holy sh-t was that Dolph movie TERRIBLE! :P

Hmmm, might have to watch that movie again. Haven't seen it in years!:)

[reillyd]

Yeah, I'm not sure that the article is right on their numbers there, that 500 mil retail price was produced but only 250 will be sold.... And Griffin is spot on about the Wave 2 stock. I wouldn't think that Hasbro would make available sales data, and the articles source may be wrong.

[nexusnixx]

Seriously! Someone at Nexus was selling a TT Prowl for $75 and got haggled down to even less. Buyer went off to get the money and i remarked to the seller "You should have kept it $75 and told him to visit TRU and pay $100 if he doens't like it!"

$75 for tt prowl was there was haggling - perceived value for these babies have come down.

I had 2 people trying to open the linkin park Soundwave. If I had not stopped in time it will been torn open.

[Gofigure]

Hmmm, might have to watch that movie again. Haven't seen it in years!:)

I'm right there with chief (looks for dvd somewhere in bookcase in back room)

[DELTAprime]

As far as the toy market as whole part goes. Is it down because the global economy is? Or is down because more toy companies are making cheaper products at high prices like Hasbro is with hollow Transformers and 5 POA Star Wars figures?

[Sky Shadow]

I was at Toys 'R' Us today, and thinking how outdated Hasbro's model is in terms of case assortments. Toys that are going to be shelfwarmers are now doubly so, because toys that people actually want will be a.) bought first by people who want them, and b.) bought by scalpers to sell online. At Woolworths, if they run out of oranges, they can order more oranges. They don't have to buy the oranges in an assortment that contains one orange, two apples, three lemons and a mandarin.

[kurdt_the_goat]

$75 for tt prowl was there was haggling - perceived value for these babies have come down.

I had 2 people trying to open the linkin park Soundwave. If I had not stopped in time it will been torn open.

It went for $65 maybe? It was either Llamatron or snaketales who sold it i think.

[kup]

I was at Toys 'R' Us today, and thinking how outdated Hasbro's model is in terms of case assortments. Toys that are going to be shelfwarmers are now doubly so, because toys that people actually want will be a.) bought first by people who want them, and b.) bought by scalpers to sell online. At Woolworths, if they run out of oranges, they can order more oranges. They don't have to buy the oranges in an assortment that contains one orange, two apples, three lemons and a mandarin.

So true, they should go back to an 80s model. I remember Transformers (and other toys) being restocked at stores once sold out.

[Lint]

I was at Toys 'R' Us today, and thinking how outdated Hasbro's model is in terms of case assortments. Toys that are going to be shelfwarmers are now doubly so, because toys that people actually want will be a.) bought first by people who want them, and b.) bought by scalpers to sell online. At Woolworths, if they run out of oranges, they can order more oranges. They don't have to buy the oranges in an assortment that contains one orange, two apples, three lemons and a mandarin.

It's also a retailer problem. My local coles refuses to buy in cases of Schweppes Agrum and instead only stocks Sugarfree Agrum. Sugarfree Agrum shelfwarms like crap even when its on special. This has been an ongoing problem for nearly 3 years so they clearly haven't noticed or cared.

If Hasbro did do cases of single product types theres no stopping an ignorant retailer from ordering a boatload of crap we don't want and not learning their lesson from it. Also, with this, there is a huge risk that a particular product may not get picked up by retailers at all, so all your design and development costs go down the toilet. It's a pity that Hasbro pretty much have to tailor their product to sell to the retailer, not the end consumer.

[Sinnertwin]

Single figures, multiple figures, you're inevitably going to end up with figures that don't sell.
The key is variety. Nobody is going to be interested in a figure that has been available for the last two waves. From what i've seen, Hasbro do seem to be changing their ways... slowly.

[SharkyMcShark]

Quality has gone through the floor since 2011 to the extent that I've basically stopped collecting. I used to be a fairly broad consumer of the franchise - absolutely loved the movie line figures, didn't particularly like the Animated show but got most of the figures, and got a fair whack of the Generations/Classics stuff too, but no more.

The last six new Transformers toys that I bought and actually enjoyed were

Gen Springer (April 2013)
DoTM Human Alliance Roadbuster (Jan 2013)
MP-13 Sideswipe (mid/late 2012)
MP-12 Starscream (June 2012)
FE Prime Cliffjumper (Feb 2012)
DoTM Human Alliance Soundwave (Feb 2012)

Basically everything else I've seen from DoTM and Prime's mainline going forward has been absolute garbage to the extent that for the first time in literally about 16 years I don't even bother to keep up with what's on the horizon, what's actually coming out, and what's hot.

I don't know how much that would affect non-adult collectors but it's basically killed off most of my interest in Hasbro and Takara's stuff, and now my purchasing pattern is older figures that I missed and feel like I'd enjoy and third party stuff.

[5FDP]

The last Transformer I ever bought was Encore Fort Max. The only thing that would bring me back to collecting at this point is if they announce a MP Shockwave or reissue G1 Dinobots.

[kup]

Agree that today's toy lines are crap. Why isn't MOTU as 'mainstream' as Star Wars or Transformers these days?

Mattel - They seem to not like the line and do everything they can to knock it down. The only reason it exists is due to a couple of 'fans' within Matty that have kept it going but one of them is a total douche and that has caused problems too as he treats Matty as his own play thing so he can get the toys HE wants.

[kup]

Hasbro should take note of what Nintendo is actually doing. While the toy market is decreasing, Nintendo actually wants to break into it:

http://venturebeat.com/2014/07/14/the-looming-amiibo-how-it-could-reinvigorate-nintendo/

I actually think Nintendo is on the right path here. They are basically aping Skylanders but with neater figurines that actually have a purpose within any Wii U game.

If Hasbro were smart (Yeah..:rolleyes:), they would be doing something similar by incorporating chips into their toys so they can be scanned online onto games. The potential would be limitless as they could have 'make your own episode' apps in which you scan characters in or simply have decent video games in which you can play or interact with your favourite characters.

If they want to keep it simple like Nintendo are first starting off with, juts have them as virtual Trophies you can show off on social media as owning once you scan your toy.

The gimmick would be totally non-intrusive to the toy design and reasonably cheap to execute since the chip would be tiny and only contain what is basically a code with numbers.

There you marry both the digital age and physical toy interest back into the children mainstream. However you need forward thinking and willingness to innovate which Hasbro apparently do not.

[Lint]

However you need forward thinking and willingness to innovate which Hasbro apparently do not.

A very true statement. Their attempts to break into the electronic market have been half-arsed at best.

They haven't been doing too badly at focusing on their core strength though, which is selling toys marketed through media. I'd say that majority of my recent purchases have been more greatly influenced by characters/likenesses portrayed in comics/shows/nostalgia rather than the actual quality of the toy itself.

[kaiden]

Hasbro should take note of what Nintendo is actually doing. While the toy market is decreasing, Nintendo actually wants to break into it:

http://venturebeat.com/2014/07/14/the-looming-amiibo-how-it-could-reinvigorate-nintendo/

I actually think Nintendo is on the right path here. They are basically aping Skylanders but with neater figurines that actually have a purpose within any Wii U game.

If Hasbro were smart (Yeah..:rolleyes:), they would be doing something similar by incorporating chips into their toys so they can be scanned online onto games. The potential would be limitless as they could have 'make your own episode' apps in which you scan characters in or simply have decent video games in which you can play or interact with your favourite characters.

If they want to keep it simple like Nintendo are first starting off with, juts have them as virtual Trophies you can show off on social media as owning once you scan your toy.

The gimmick would be totally non-intrusive to the toy design and reasonably cheap to execute since the chip would be tiny and only contain what is basically a code with numbers.

There you marry both the digital age and physical toy interest back into the children mainstream. However you need forward thinking and willingness to innovate which Hasbro apparently do not.

when skylanders first came out, my first thought was that it would be more awesome for transformers in a moba style game(dota/lol)

[kup]

when skylanders first came out, my first thought was that it would be more awesome for transformers in a moba style game(dota/lol)

Even if they do catch on to try it, they would probably stuff it up. Just look at their sorry attempt to compete with Lego. It seems that they misunderstand what actually makes Lego fun or they don't invest well enough on artists and designers to come up with good concepts.

I think Hasbro will continue to deteriorate until someone buys them out as they clearly have no motivation to change the current course despite diminishing returns.

[GoktimusPrime]

It's a pity that Hasbro pretty much have to tailor their product to sell to the retailer, not the end consumer.
Do they have to, or do they choose to? Cos it seems that Takara are more inclined to cater for the end consumer. :o

[CBratron]

Do they have to, or do they choose to? Cos it seems that Takara are more inclined to cater for the end consumer. :o

Well, I was under the impression we were supposed to have Generations and movie toys on shelves at the same time but the super-retailers in the US wanted it changed, hence the 'miscommunication' with the generations release dates.

[kup]

Do they have to, or do they choose to? Cos it seems that Takara are more inclined to cater for the end consumer. :o

Technically they don't have to but the present retailer centric business model they use which they refuse to divert from limits them.

[Lint]

Technically they don't have to but the present retailer centric business model they use which they refuse to divert from limits them.

Would you risk losing a multi-million dollar contract with a retail giant where all you have to do is deliver stuff that doesn't harm people on time at a unit price of $0.XX? Your shareholders would murder you overnight.

I don't want to be a Hasbro apologist but sometimes I marvel that we manage to we get what little we do get given such constraints.

[kup]

Would you risk losing a multi-million dollar contract with a retail giant where all you have to do is deliver stuff that doesn't harm people on time at a unit price of $0.XX? Your shareholders would murder you overnight.

I don't want to be a Hasbro apologist but sometimes I marvel that we manage to we get what little we do get given such constraints.

It's hard to marvel at much these days given the current state of the toy shelves, specially TFs. There is clearly diminishing returns every year with the present business plan and quickly getting worse.

Shareholders will murder them anyways given how it's going, only delaying the inevitable unless course is changed.

[Dimi194]

I was at Toys 'R' Us today, and thinking how outdated Hasbro's model is in terms of case assortments. Toys that are going to be shelfwarmers are now doubly so, because toys that people actually want will be a.) bought first by people who want them, and b.) bought by scalpers to sell online. At Woolworths, if they run out of oranges, they can order more oranges. They don't have to buy the oranges in an assortment that contains one orange, two apples, three lemons and a mandarin.

Just had the privilege to have a look at a yet to be placed on shelves box of AOE deluxe figures. Despite there being no Drifts (I bought the last one), Crosshairs or Bumblebees, the box of about 20 had only 3 Bumblebees, 1 Crosshairs (mine!) and the rest were Dinobots... which were still on the shelves... silly Hasbro!

[i_amtrunks]

They've blown all the hype they could've gotten from the movie. Its past the holidays and the movie has been out for almost a month, its time is over.

Hasbro should've had 3-4 waves of toys out on shelves pre movie, with a large focus on the Dinobots (from the advertising), Lockdown (as the star) and their 2 leading bots, with later lines releasing the other "main" cast.

As is now, since they forced so much early wave crap onto retailers here, they will never clear it all for new waves.

They need to rethink their media strategy and go back to having a tv series on, even at the same time as the movie. You only have to look at TMNT or Ben 10, the weekly series is constantly on, and those toy sections are forever moving stock. Transformers is closer to Monsters University, where stock remains on shelves forever and never goes anywhere until clearanced.

[Sinnertwin]

Speaking of crap, i was filling in the toy section today and i overheard a parent in the next aisle ask his son if he wanted a Mashing figure. There was a pause followed by "they look like s***, mum, can i have the big dinosaur?"
Needless to say, i don't think i've sold one.

[Zommael]

My two cents on this: Hasbro generally (and the other toy companies) need to dial back what they're doing. There is a massive over-saturation of the market for product and it is not helping. Transformers is a prime example. In addition to Generations and the mainline/gimmick line, we also have Kre-O, mashers, Constructbots, walkie talkies, RC cars, "Titan" over-sized figures, and up until recently Botshots (no doubt I am missing some). These items might all make for good toys, but none of them is helping either the mainline or Generations to sell. All they are doing is diverting cash away from what ought to be the main series.

Marvel is another good example: ten years ago, when the licence was with Toybiz, we had Marvel Legends, Spider-Man classics, and intermittent movie lines which remained compatible with those lines as far as possible. Now look at the mess of different, almost mutually exclusive, toylines they're producing! If ever anything illustrated the value in keeping things simple it's this.

In Transformers' case, it seems pretty clear the over-simplified idea hasn't worked. It was a good idea in many ways, but it could have been introduced in a way which didn't divide the movie line in two and set collectors, kids, and older kids against each other. No kid is going to want a toy which they perceive as being for "babies". Hasbro could have avoided this perception if they had worked on the one-step and flip and change concepts a bit more and created toys with the level of articulation and detail of Generations but using these new transformation styles. Collectors still would have complained, but to be honest if Hasbro announced they were giving every collector a solid gold lifesize statue of Optimus Prime for free collectors would complain, either because it was Prime and we have too many Primes, or because it would be released in America on Tuesday and over here on Wednesday, or something.

The main point is they need to rein it in. Stop flooding the market with products that, basically, aren't Transformers. Bring things back into status quo and go from there. It's the one strategy they haven't tried yet to address the situation with the toy market, and it's the one that might work.

[ChlorHex]

Interestingly, I'm reading "Good to Great" by Jim Collins and there is mention of Hasbro's rise (then) as it gained profound insight into its economics.
This was when it was under the leadership of Stephen Hassenfeld.
Then with Stephen's demise, it lost its discipline to remain focused and its direction became a dog's breakfast.
Poor leadership and losing focus... We see that now in the toys.