Sales of Star Wars-related toys are “running ahead of our expectations” — to the point where “inventory has been light,” forcing Hasbro to catch up — CEO Brian Goldner told an Investor Day gathering today.
The lead toymaker for the movie franchise notes that it’s unlike most other licensed merchandise properties: Toys and other stuff tied to Star Wars: The Force Awakens hit the shelves about nine weeks ago on Disney’s “Force Friday.” For most other releases the film would be in theaters by now to help stoke consumer enthusiasm.
Goldner says he’s confident that demand will remain strong leading up to the movie’s release December 18 — and beyond as sequels are released. “It’s not just about this movie,” he says. “Over the next five years there’ll be more Star Wars entertainment than there’s been over the last 30. You’re reigniting a fan base.”
Hasbro saw that in the last two months: Collectors were among the first to hit stores looking for Star Wars merchandise after Force Friday.
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“When you go from all the hype to the movie itself we expect lots of young people to go to the theaters” which he says “rekindles the brand.”
That’s a key part of Goldner’s broader strategy to increase Hasbro’s portfolio of entertainment-related products. It will be “a major growth driver over the next several years.” In addition to Star Wars, Hasbro markets toys for Marvel, Disney Princesses, Frozen, Trolls, Sesame Street, Jurassic World, My Little Pony, GI Joe, and Transformers.
“Transformers is one of the most successful theatrical franchises of all time,” the CEO says. “More importantly for Hasbro, the film franchise has elevated the brand’s size and scale.”
Overall, the operating profit margin for entertainment and licensing-related merchandise has averaged 28% over the last five years. And sales from story-led entertainment brands is up 7.2% since 2012 vs non-entertainment brands which are down 0.1%.
Goldner says Hasbro and retailers are “incredibly excited” about the “robust product line” planned for DreamWorks Animation’s Trolls, out late next year.
He also talked up Hasbro’s Allspark Pictures, a studio designed to help the toymaker “gain greater creative control to reach new demographics…in the superhero genre and beyond.” Stories that target global audiences “will be a foundational element for great brands” as worldwide box office sales are expected to hit $46 billion in 2019 with China No. 2 behind the U.S. with $8.9 billion.
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