Action Figures Market Gets Older, More Sophisticated
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July 2003 | Vol. II - No. 7

July 2003 | Vol. II - No. 7 TDmonthly SEARCH

Action Figures Market Gets Older, More Sophisticated

It started with G.I. Joe, kicked into high gear with the Teenage Mutant Ninja Turtles, and today action figures have taken on a life of their own. Representing everything from movie heroes to comic book characters to the stuff of artistic dreams, they now span the gulf between child's plaything and valued collectible.

Peter Nason, accounts manager and director of communications for Marz Distribution (ToyDirectory) says he picked up on the potential in the mid-1980s when consumers started buying two Ninja Turtle figures: one for the child and one to keep as a collector’s item.

"[My sister] was buying two Ninja Turtles for each of her boys -- one to play with, [and] one to put away for them," explained Nason. "Things were bought not only for their play value but for their collectibility. What happened is [companies] realized they have two markets -- the children's market and the adult collector. One is for the love of the toy, the other is wanting to display that toy, or for some later financial gain."

Spawn Mutated

Todd McFarlane, creator of the Spawn comic book brand and founder of McFarlane Toys, isn’t afraid to see action figures as the young boy equivalent of Barbie. "It's been our equivalent of the doll aisle," he said. "We've got to be a little more macho about it. Cool robots and monsters and all that kind of stuff."

There has been a long history of action figures related to movies, a trend started with the release of the original "Star Wars." Movie characters now dominate the action figure landscape.

"The comic books have become the minor leagues of the movie business," admitted Michael Horn, president and CEO of Palisades Toys. "The comic books are almost a forgotten medium against movies. We don't really license a lot of comic books anymore because it's a decreasing medium."

Action figures are experiencing something of a comeback in the toy marketplace after the industry-wide malaise of recent years. McFarlane is cautiously optimistic about this recovery. "The action figure aisle hasn't had a huge, blockbuster mega-star," he said. "It's making a bit of a comeback but instead of one big hit where somebody catches lightning in a bottle, it's more wide spread. Maybe our category is at least a little ahead of the curve compared to other categories that are finding their legs still."

McFarlane believes the market has expanded in two ways:

First, the evolution of action figures to collectibles has turned an older demographic on to the products, which has in turn encouraged non-traditional retailers, such as music stores, to carry the figures. "You're now creating new accounts from places that never ever carried toys," McFarlane said. "You're not buying it with the toy mentality, you're buying it from a trinket mentality. I think we're going to sell a lot of Matrix toys to people who never bought a toy before."







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Second, by producing better, more detailed products, manufacturers learned they could charge more for the finished piece and not hurt sales. "We actually make more money by spending more," McFarlane said. "People will pay for quality."

With a product list ranging from the Muppets to adult film stars, Nason admits retailers have some difficult decisions to make when ordering. "Sometimes you can predict what will be hot. Sometimes the film is a big hit," he said. "You've got to follow the pulse. When the trend slowly will dissipate, what's going to be the next big hit? If you're a retailer, ask your customers. What's the buzz? What are they watching? If you hear it once, okay, but if you start hearing it twice, three times, you might have something."

On the flip side, Horn believes suppliers are finding retailers to be more fickle in ordering. Rather than riding a wave of popularity for months, stores are much more willing to move on to the next big thing.

"I think what's happening is the retailing community doesn't have the patience to stay with any one product for the long term," Horn said. "The windows are just shorter and shorter. Retailers say, 'Let's order what we think will sell out in a week.' If it sells out, you breathe a sigh of relief and move on to the next thing. We don't even do movies," Horn continued. "We only license the products that are evergreen."

While some companies have made forays into the marketplace with stand-alone characters, such as Palisades’ UrbAnimals, McFarlane agrees that originality is the more difficult approach.

"That's the steepest road to climb," he assured. "It's easier for a retailer to say, 'I have a movie product, a TV product, a comic book product, and you're coming in here with something that has no backing?'"




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