Toy licensing of movie franchises has garnered attention from mainstream media this week. Time looked into the relationship between Mattel and Warner Bros. while developing toy products for the new blockbuster Green Lantern. The Wall Street Journal focused on what defines a Cars product. With more franchise blockbuster movies to hit by the year’s end, this can only be the beginning of the movie explosion in toy aisles—with X-Men: First Class currently in theaters; Transformers: Dark of the Moon, Harry Potter and the Deathly Hallows Part 2, Winnie the Pooh, The Smurfs, and Captain America all due by the end of July; and The Muppets releasing in November.
Film studios bring in toy makers early in the development process for a film like Green Lantern in order to ensure brand visibility in toy aisles, according to the Time article, “Green Lantern and Mattel: Friends with Benefits.” Doug Wadleigh, senior vice president of franchise development at Mattel, told Time that Mattel has access and input into big upcoming projects up to 18 months before theater release, and Mattel spent more than a year designing Green Lantern action figures and products.
Toy makers like Mattel give the studios input earlier in the film development process to tell why that particular film could translate into toys. Doing this integrates the toy company with the filmmakers to develop products kids want. Newer brands, like Green Lantern, cost toy makers less money to license the film and come as a lower risk if movie tickets and products don’t sell. Thus, according to Time, Mattel paid Warner Bros. $2.5 million in royalty fees for Green Lantern, expects perhaps $20 million in toy sales for the film, and as a $5-billion-a-year company, is risking much less of a loss if sales don’t do as well as expected. (See USA Today for more about Green Lantern products.)
Studios, however, increase the likelihood of reward by focusing on films with the potential for sequels, spin-offs, products, games, and even theme-park attractions, according to The Wall Street Journal’s article “Cars 2 Is Already a Hit–In Stores.” WSJ cites an estimate that Cars 2 cost slightly less than Toy Story 3’s $200 million production costs. In order for Disney’s Pixar Animation Studios to generate profits beyond breaking even on production costs, the studio looks for merchandise tie-ins for a portion of its films.
Target announced earlier this month its collection of merchandise inspired by Cars 2, which hits theaters June 24. Fur further integration, Target features a dedicated boutique of Cars 2 products online at Target.com/Cars2, including an interactive experience with the movie’s characters and an exclusive custom animated TV spot created for Target by Disney•Pixar.
“Fans are clamoring for Cars-inspired merchandise that brings the stories and characters from the film to life,” said Bruce Morrison, senior vice president of sales at Disney Consumer Products, in a press release. “Target has captured some of the movie’s magic through its expansive Cars 2 assortment, and we know fans will love it.”
Disney and its licensees also have products lining Walmart and Toys “R” Us shelves, and merchandise expands through multiple departments, with products such as Kleenex, shampoo, food items, kids’ furniture, sleeping bags, and video games, according to WSJ. Furthering franchise expansion, Disney has plans to open a 12-acre Cars Land at it California Adventure theme park next year, and DisneyToon animation studio is working on Cars spin-off direct-to-DVD films.
In another WSJ article, “Franchise Guardian at Pixar Tries to Keep Cars 2 on High Road,” Pixar’s Jay Ward said he seeks to keep merchandise tie-ins authentic, measuring by “truth in materials,” such as a heavier car moving slower than a lighter counterpart. He also monitors products for accuracy to the characters and the world they live in.
Cars 2 may sell more merchandise than any single previous Disney film, including Toy Story 3, which set the bar last year with $2.8 billion in merchandise sales, according to WSJ. The first Cars installment has sold an average of $2 billion annually since 2006.
With focus on films’ potential for retail sales, it’s not surprising that Warner Bros.’s Legendary Entertainment is negotiating with Mattel, in this case to receive film rights to the Hot Wheels toy car line, according to Variety. By purchasing film rights from a well-known toy line, it’s hard to imagine a toy maker more seamlessly integrated into a film.