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Will Mattel And Hasbro Sell More Games and Toys Through New Collab?
Rivals Mattel and Hasbro, for the first time, have entered into a multi-year licensing agreement to create co-branded toys and games.
Hasbro will create Barbie-branded Monopoly games launching in fall 2023. Mattel will produce Transformers-branded UNO games, slated for release later this year, and Transformers-branded Hot Wheels vehicles, set to debut in early 2024.
The two firms typically compete over licensing properties. Mattel in 2022 took over the license for Disney’s princesses, including its Frozen franchise, after Hasbro’s deal expired.
The collaboration comes as two major movies – Transformers: Rise of the Beasts from Paramount and Barbie from Warner Bros. – arrive in early summer to support merchandise opportunities.
A merger between Mattel and Hasbro has been speculated for years, but officials last week on quarterly analyst calls likened the collaboration to other licensing deals.
“I am excited about the Mattel collaboration, and it joins those with other big toy companies like Spin Master and LEGO and smaller players like Just Play, Basic Fun, and Play Monster. So, it’s a way to extend our brands, monetize our IPs, and leverage our own category captains for things like the Barbie crossover for Monopoly,” Hasbro’s CEO Chris Cocks said.
Mattel’s CEO Ynon Kreiz speaking on an analyst call referenced the Hasbro collaboration alongside licensing opportunities tied to Disney’s upcoming Little Mermaid and Wish films.
“The extensions really give us the opportunity to broaden our reach, drive revenue, and monetize the [Barbie] brand as a franchise,” said Mr. Kreiz.
A university study led by London Business School found “competitive collaboration” – i.e., joint ventures, outsourcing agreements, product licensing, cooperative research – can wind up providing more of an advantage to one firm over the other but also often drives significant savings in time and money in bringing product to market. The researchers wrote in Harvard Business Review, “Competitive renewal depends on building new process capabilities and winning new product and technology battles. Collaboration can be a low-cost strategy for doing both.”
Discussion Questions
DISCUSSION QUESTIONS: Do you see more pros than cons for Mattel and Hasbro with their newly announced licensing agreements with one another? What caveats would you have for brands or retailers exploring partnering with a rival?
Poll
Loading …BrainTrust
Carol Spieckerman
President, Spieckerman Retail
Dave Bruno
Director, Retail Market Insights, Aptos
The frenemy forays just keep coming. Co-branding makes all kinds of sense for Mattel and Hasbro and licensing is the most agile way to make it happen. Mattel and Hasbro retain unique stables of properties that will pack more punch, and gain wider distribution and awareness when combined. All in all a great move that doesn’t preclude a future merger (and may indeed serve as a test for it).
I see so many things to like about this collaboration. Each partner can leverage their competing but complementary brands and licensing deals to the benefit of each other. Broader reach, greater visibility, and higher revenues for both. The definition of a win-win.
There’s already a version of Monopoly for everything else conceivable, so why not let your biggest competitor get on the board, too? I see this collaboration as a win for both companies and the consumer. They will increase their speed to market and leverage each other’s strengths in marketing, production, and distribution. Monopoly fans will buy this from Atlantic Avenue to Boardwalk. The Barbie-themed Monopoly game hearkens back to the early days of the product when they started releasing city-themed products. Oh, I just found out there are Monopoly versions for Sephora, Zappos, Seinfeld, and The Three Stooges. Where can I find the RetailWire version?
Since both are highly recognized companies, the consumer, the licensor and the licensee can have confidence in the quality of the products being offered. Hasbro is highly recognized for games. Mattel not so much. Licensing should be with those businesses with complementary, similar quality products, not redundant or one-off offerings. Barbie consumers should be very happy with this partnership.
It’s a perfect scenario for 2 + 2 = 5 or 6 outcomes.
There are definitely pros especially when thinking of certain brands, like Barbie, as franchises. As a movie, it makes sense to maximize its licensing potential and to think of it as more than just a competitive asset. And maybe there’s also the greater strategy of defending the market and legacy of traditional toys. The key will be to collaborate in areas where distinct lines can be drawn or where the collaboration has the greatest chance of being mutually beneficial while remaining committed to their individual, core competencies (that is, until they finally merge).
This is a win-win for both companies as they are licensing very popular properties that consumers are likely to scoop up in large quantities. Sure one may come out of this relationship slightly better positioned than the other, but there are always risks in every licensing decision. In this case the potential benefits far outweigh any potential risks.
This will produce big wins for both companies and fun for customers.
For years the street has been trying to get these companies to combine. Other than historically, these types of mergers don’t benefit anyone except lawyers and bankers. Merging companies takes away the creativity that comes with the need to compete.
It strikes me that this handshake will only spur creativity. It gives twice as many hearts and brains the chance to apply creativity to these valuable and fun properties.
I look forward to moving Barbie or Ken around the Monopoly board! Better yet, give me that Barbie-themed 1969 Chevy Camaro Hot Wheels car! There are so many opportunities here for them, and if they can get the collaboration part right (which based on the two company cultures can be difficult) there is a lot of upside.
Key question is, in the end, will this partnership deliver better games, better game content to ultimately drive expansion of the category, nudging more consumers to embrace more leisure and fun time via games? Or does it wind up more as co-branding with colors, characters and new twists on game rules. The former has a lasting impact on revenues, where the latter may be a temporary blip of fun.