From social media outbursts to doubling business turnover with the launch of this year’s craze, LOL Surprise; ToyNews talks to Isaac Larian, the man leading MGA Entertainment into the future
Loathe his brash, outspoken attitude towards the toy trade or love his refreshing honesty and transparency through social media channels, one thing you can’t do is ignore Isaac Larian.
For those on the receiving end of his barbed ‘truth bombs’ that have been splashed across LinkedIn over the last few months, the MGA Entertainment CEO has been the migrane among some of the world’s biggest toy companies, that no amount of aspirin will rid.
Having undertaken the mission to unmask some of the industry’s less desirable activities at a time of upheaval among some of the biggest names, it would appear that Larian – quite literally the billion dollar play boy – and his recent vocalisation begs the question: is he the hero that the industry deserves, but not the hero it needs right now?
We can’t answer that. But let there be no doubt that with great power – heading up the largest private toymaker in the US that took an estimated $820 million last year, for instance – comes great eccentricity.
With an 82 per cent share of the company worth an estimated $1.1billion, Larian can afford to take liberties. And those liberties make for spectacular reading. An enigma of the industry, it’s difficult to work out whether Larian’s comments are ones to be taken with a pinch of salt, or a spoonful of sugar.
Having called out LEGO via social media, appealing to the 1400 employees now in search of new jobs to apply for roles with MGA Entertainment, you’d be forgiven for thinking of Larian as the industry’s biggest troublemaker. It’s either that, or he is one genius marketer.
Whatever side of the sword you fall on, it can’t be denied that whatever Larian is doing right now, it is working.
“We are growing 180 per cent this year, and that’s on top of the high double-digit growth we saw last year,” Larian tells ToyNews.
In the early 2000s it was Bratz that put MGA Entertainment on an upward trajectory. One hiccup, a dusting-off and a re-evaluation later, it is on the crest of the collectables wave that the toymaker is now heading into 2018.
The product that has stolen headlines across the globe this year is of course LOL Surprise - a range that, tapping into both the current collectables and the unboxing phenomenon, sold 2.5 million units by April this year, just five months after its launch.
“This year has been just incredible. LOL Surprise is by far the runaway toy of the year,” continues Larian, who has also seen the launch of Awesome Little Green Men, a line of collectables aimed at the boys market and the continued success of Num Noms.
“I am very proud of our team who has created at least eight brands from scratch to $100 million plus, but nothing like LOL Surprise. LOL Surprise Big Surprise was launched on September 29th and was an instant sell out worldwide.
“We are now scrambling and airfreighting goods to meet some of the demand, but for sure, we won’t be able to meet the whole demand.”
Such is the success of the range that Larian now expects to see the MGA Entertainment business double by the time 2018 rolls around, citing newness and innovation as the primary drivers.
It can’t be denied that the firm has certainly struck a huge chord among the zeitgeist of children’s entertainment. Not only has LOL Surprise tapped firmly into this year’s collectable craze, but has taken the idea of the blind bag to new levels with a product that allows children to become the stars of their own unboxing experience.
In fact, it was this approach that became the focal point for the most recent launch under the LOL Surprise umbrella, with the launch of LOL Surprise Big Surprise and the introduction of Unboxing Video Booths to 15 cities across the world, including London. The concept was an extension of the marketing programme that has so successfully launched the LOL Surprise brand to global fame, one that opted for the high impact of online influencers and YouTubers over traditional TV advertising.
Was it a shock tactic of Larian to deny the product launch the typical support of TV advertising investment? Perhaps, but a savvy one all the same. With TV investment amounting to zero, Larian is the kind of man that where others tread lightly over eggshells, the MGAE CEO brings a bulldozer.
It was in a recent interview with a US trade title that Larian was cited as saying that “there was a time in the industry where you just made a commercial for the toy and put it on TV… that trend is completely over.”
For Larian, the momentum of how a product is marketed has changed, going on to say in the matter-of-fact way we have only come to expect of him that, ‘the days of TV advertising for toys are over. They’re coming to an end, fast.”
For Larian, Facebook and YouTube offer the greatest audience reach while some of the largest children’s networks and broadcasters can only look on as they too fall victim of his outlandish social media posts.
Is he on to something? You don’t become one of the industry’s wealthiest CEOs by luck alone. Surely it takes foresight and the ability to spot future trends ahead of the competition? No matter how many people you rub up the wrong way in the process.
And it would appear that Larian is not short of ideas. Already, the firm has plenty of big plans for the LOL Surprise franchise, having recently appointed UK licensing agent The Point. 1888 to represent the brand here in the UK, and presenting the franchise at last month’s Brand Licensing Europe show in the capital.
“Licensing is an important part of our strategy and marketing,” Larian explains to ToyNews. “We see licensing as the roots of the brand tree that keeps it together and grows the brand.”
Whether the brand will hit the same high notes as other success stories – the likes of Moose Toys’ Shopkins, for instance – remains to be seen. However, with apparel, accessories, stationery, party goods, publishing, games and sporting goods already lined up for US release in spring 2018, the foundations have certainly been set.
With such hype around the launch over recent months, it’s easy to get carried with LOL Surprise, but it isn’t the only weapon in the armoury. Let us not forget that Little Tikes continues to be a top five brand year after year, while sales of Num Noms, according to the CEO, are up 200 per cent. Both are industry leading brands in their own right.
“Licensees need these kind of hot properties,” says Larian. “My advice to them: ‘Don’t be fashionable late to this party.’”
For those that have been following Larian’s recent online outpourings, you’ll be quick to realise that not only is he a man of foresight but one of contradiction. The plight of the retail giant, Toys R Us has not escaped anyone’s attention in recent weeks; crippled by mounting debts that saw it file for Chapter 11 bankruptcy protection.
While the news threw the industry into disarray, MGA Entertainment was among the handful of global toymakers to leap to the retailer’s aid stating that ‘without Toys R Us, there is no toy business.’
Heartfelt and to many ends, true, the statement seems to jar somewhat with Larian’s overall approach to staunch traditionalists this is the man that has championed Facebook over Nickelodeon as a means to reach his target audience. Does it make sense that he would rush to the aid of an ailing brick and mortar retailer?
“For sure ecommerce is changing the way we all shop,” he says. “But for toys, if a retailer figures out how to wow and entertain a child in store, they will win over ecommerce every time.
“Toys R Us was burdened by loans with high interest rates that straddled it. I have full confidence in management of Toys R Us to come out stronger from this chapter and flourish for years to come. There is no toy business without Toys R Us.”
Perhaps it’s here that we see the mask begin to slip and the enigma that is Isaac Larian, billionaire CEO of MGA Entertainment reveal itself what he really is: a big kid at heart with a passion for toys. With his words he is playful, insightful and unafraid to speak his mind; a refreshing sense of innocence in a corporate world.
When asked the question about whether MGA will ever make a move into the augmented reality or virtual reality markets, he even sends a smiley face.
It’s a smiley face in place of a full stop. The two words that precede it are simple enough, yet wrapped in a thousand more questions, and Larian pulls that cloak of mystery straight back over himself.
They simply read: “No comment.”