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As the New Star Wars Sequel Looms, the Sales Force Awakens

As legions of Star Wars fans ready themselves for the cinema-screen return many thought they might never see, toy manufacturers, too, are keen to see if this doughty – and hugely profitable – franchise truly has been rejuvenated.

Photo: Star Wars’ toy prospects – A new hope or a phantom menace?
Star Wars' toy prospects – A new hope or a phantom menace?
Photo: Star Wars’ toy prospects – A new hope or a phantom menace?
Star Wars' toy prospects – A new hope or a phantom menace?

When it was announced that Disney had purchased Lucasfilm and would be releasing a new Star Wars movie each year for the foreseeable future, the toy industry began to salivate at the possibilities that would surely arise. If ever a licence was perfect for toys, it is Star Wars.

Almost 40 years ago, the series kickstarted a revolution in the way that toys were manufactured and marketed. The promise of new movies meant the promise of new opportunities and fresh success. Will this new tranche of films replicate the success of 1978? Or will it be the agony of 1999 all over again?

The Star Wars franchise has always been bolstered by a multitude of licensed products launched to coincide with a movie release. In the past, these have included traditional action figures, role-play items, vehicles, die-cast toys and board games. Beyond that, there have been toothbrushes, backpacks, umbrellas and a whole array of extended lines. While the property has always been milked for revenue through consumer products, the release of The Force Awakens has taken that to a whole new dimension.

When the first Star Wars prequel movie (The Phantom Menace) opened back in 1999, the pre-release hype was every bit as pervasive as it is for the 2015 premiere. Back then, though, the nature of toy licensing was different, with one company holding a master licence and producing the bulk of the products. The Force Awakens product launch has been a timely reminder of just how much things have changed, with each category sub-divided between many licensees, all vying for the same shelf space.

This is particularly acute in what has traditionally been the anchor of the Star Wars toy line – the action figure. Since 1978, the four-inch scale has consistently been the standard size for a Star Wars action figure, fostering collectability and ensuring compatibility with companion vehicles. While other scales have been released over the years, the four-inch variety has consistently been treated as the main event. Now, with the release of The Force Awakens products, consumers can still opt for Hasbro's four-inch line. The company, though, is also offering the keen collector the six-inch line, the budget six-inch line and the 12-inch line. Rival toymaker Jakks, meanwhile, has 18-inch action figures, 31-inch action figures and even 48-inch action figures.

Offering consumers too much choice, in this particular instance, is more likely to hurt than help the longevity of Star Wars toys. By splitting the action figure market into multiple segments, some scales will inevitably gain sales at the expense of others. Retailers will have to choose which scales to support. Gift buyers will be confused – the grandparent who heads into the toy shop uncertain of which character they are looking for will now also have to identify which style and scale is required.

This is not just true of action figures. Both Spinmaster and Thinkway are offering flying Millennium Falcon products. Mattel and Hasbro both have different lines of die-cast vehicles. Posh Paws and Underground Toys both have plush ranges (as does Comic Images in the US).

Having multiple ranges of the same product, however, actually reduces the benefit of the product line. Retailers cannot stock all of the different ranges, the manufacturers and distributors are getting a smaller share of the pie, and consumers are left baffled.

The timing also makes things difficult for the toy sector, as only limited product was released on 4 September, all featuring designs selected from the first third of the movie. To maintain the interest of those who are eager to buy the new lines, a steady trickle of product is needed up to and beyond the movie's release on 17 December.

Getting new waves or ranges to toy store shelves in January tends to be difficult, with many not bringing in new product until Easter. If fans don't get toys related to the movie's core characters – Luke Skywalker, Han Solo and Princess Leia – during the release window, they will potentially lose interest.

In the UK, the Disney Store has created an impressive in-store presence for Star Wars. It's not all positive though - if product categories have arguably been split too much already, the Disney Store's exclusive lines split them still further. It is, for instance, the only place to buy voice-changer helmets of a number of the new movie characters, notably Kylo Ren.

Photo: BB-8 – is this the droid you’re looking for?
BB-8 – is this the droid you're looking for?
Photo: BB-8 – is this the droid you’re looking for?
BB-8 – is this the droid you're looking for?
Photo: Han Lego and Chewbricker…
Han Lego and Chewbricker…
Photo: Han Lego and Chewbricker…
Han Lego and Chewbricker…

There are also six-inch, die-cast metal action figures available at a lower price point than the Hasbro six-inch plastic action figures. The range also includes die-cast vehicles, role-play products and a popular remote-controlled BB-8 droid – staple items at the right price points and all with the benefit of exclusivity.

The launch for the new merchandise came courtesy of the well-trailed Force Friday event, kicking off with midnight openings at selected retailers. These were predominantly specialist toy retailers, the heartland of Star Wars merchandise, largely due to the age range it targets and the nostalgia that adult fans get from indulging in it.

Building up to Force Friday, Lucasfilm created an "official unboxing" marathon – for the uninitiated, many toy fans took to YouTube to film themselves opening their long-anticipated toy package. Rather than rely on the fans to do it of their own volition, Lucasfilm co-opted celebrity Youtubers, such as Dollastic, to build hype for the new merchandise.

The danger with focussing attention on those who spend a lot of time in the social media echo chamber is that, just because they express excitement about the £129.99 Sphero BB-8 product, this will not necessarily translate into sales. Faux fans on social media do not have pockets as deep as seasoned fans, or the parents of excited children, and will inevitably lose interest once the hype has died down. Disney needs an audience – and consumers – who will return year after year.

The group that really should be looked after are those fans who grew up with the original trilogy, as well as those who grew up with the prequel trilogy. Not only are they willing to buy toys and collectibles for themselves, many now have families and will buy toys for their children. To be fair, a number of the American TV adverts seem to be only too aware of this, with Toys 'R' Us and Walmart both producing commercials that focus on the intergenerational appeal of Star Wars.

Unfortunately the goodwill of such fans was sorely tested by the midnight opening and Force Friday product launch events, with the long-awaited four-inch and six-inch action figures selling out within the first hour, leaving disappointed fans with only B-team products to choose from. As previous midnight events had plenty of stock to go around, the short shipping of stock this time left fans disappointed. Those who were back after a 10-year hiatus didn't queue up at midnight just to buy another edition of Star Wars Monopoly.

In its year of resurgence, it is vital that Star Wars builds a loyal consumer base in order to ensure the brand's longevity. By focussing the selection of products on the core lines and then building additional sensible product ranges around it, fans will continue to support the brand. There are those who believe that the Star Wars logo shouldn't be on multivitamins or bags of apples. Overextending the brand will lead to too much product lying around months after the movie has come and gone, until it is time for the next instalment to hit cinemas.

Despite the massive oversupply of action figures in 1999, they were initially the most popular product line. The electronic money banks, Dancing Jar Jar Binks, Watto Koosh balls and Darth Maul Rubik's Cubes, though, sat piled high until they were ruthlessly cleared.

This abundance of peripheral products led to retailers and manufacturers being extremely cautious with regard to the Star Wars licence, leading to a muted launch for Attack of the Clones in 2002. With Disney planning to release a film every year, it can't afford for The Force Awakens to spur the same backlash.

Photo: Baulch: “Intergenerational appeal.”
Baulch: "Intergenerational appeal."
Photo: Baulch: “Intergenerational appeal.”
Baulch: "Intergenerational appeal."

When the final Star Wars prequel was released in 2005, the merchandise was again ramped up, but not to the impossible levels of 1999. At the time, Hasbro released a core range of action figures that served as the centrepiece of the range, with a healthy selection of Lego and logical product offerings from other licensees. Both Hasbro and Lego managed to maintain healthy sales for several years after the movie was released, largely because the supply level was correct and the market had not been over-saturated with irrelevant product. Star Wars was still welcome.

Naturally, Disney acquired Lucasfilm primarily to profit from Star Wars. If licensees and retailers, however, don't also profit then, to quote Han Solo, "this will be a real short trip". If longevity is not built into the Star Wars brand, if it does not stand for quality, then consumers will lose interest and fans will stop buying the merchandise.

There is a legacy to protect – people have a strong emotional connection to these stories, the foundation for this entire merchandising enterprise. Ultimately, Star Wars is only a licence to print money with the right product, at the right time, and to the right standard.

John Baulch is the Publisher of Toy World magazine

Content provided by Picture: HKTDC Research
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