Parkwood Stud is possibly one of the nicest locations for an office that I’ve seen. I’m even lucky enough to have picked a rare sunny day for my visit to Mega Brands in early July.
And when I meet Dave Martin, Mary Price and Peter Fuller, all are upbeat and encouraged about how 2012 has panned out so far and how the rest of the year is looking. They have a right to be, too: Mega is way ahead of its expectations and significantly up year-on-year.
“The year can change very quickly from this point in, of course, but you’ve got to say that signs are encouraging,” says David Martin, VP international. “NPD has got us at 18 per cent up. Not all of the industry is experiencing that kind of velocity, so we’re pleased with where we’ve got to.”
The growing success of the construction sector – it was up 26 per cent through to the end of May, according to NPD – has certainly been to Mega Bloks’ benefit. “It’s very clearly the fastest growing category in the industry,” Martin continues. “But growth has been consistent in construction.
“It’s not just a new phenomenon now – that’s been the story for a number of years.
“I think it’s the combination of great toys, great play value and great licences – you’ve got to be in the right place at the right time. I think there’s been a lot of work done by construction toy companies, particularly by Mega Bloks, to make sure we’re relevant.
“We’ve invested heavily in innovation and are going into new areas. Mega Bloks was really the first toy company globally to translate video games content to traditional toys successfully; that has been amazingly strong for us.”
Indeed, the firm’s Halo range has been something of a highlight in its portfolio – it continues to surpass all of Mega’s expectations – and it will soon be joined by World of Warcraft (see ‘WoW: The products’) and Skylanders in the line-up. But the firm’s success isn’t down to one category.
“We’ve got a good balance within our portfolio,” says senior director of international, Mary Price. “It’s a much more healthy position to be in than just being super reliant on one category. We had a really strong start to the year in pre-school, our classic Maxi Bag tends to do really well and we’re just rebranding now under First Builders, while Moshi Monsters has done extremely well for us in our girls portfolio and that momentum will continue into autumn/winter.”
Hello Kitty and Spider-Man have also been particular highlights, says Price, while earlier this year Mega inked a deal with Mattel, which will see it launch Barbie and Hot Wheels-themed construction toys in spring 2013.
Martin continues: “We’ve got video games content, movie content and I guess the other stream would be TV-related and that’s Power Rangers. Again this was new for us this year, so that’s an incremental piece of business. I also think we’re appealing across the price points as well – we have everything from micro action figures at the £1.99 blind bag price point right up to our higher priced Halo items. We’re getting good business right across the spectrum from that point of view.”
While the micro figures may be at a low price point, they are also helping Mega to strengthen its relationships with key retailers.
“We’ve noticed a massive increase in retailers getting a better presence and a better in-store solution for the micro figures,” says Price. “They are performing really strongly and, sometimes, they tend to be the first purchase for a particular licence. They act as a gateway.”
Martin points out: “Plus you can get more distribution – you can put smaller products down in 1,000 stores or more if possible. And you’re appearing in different places throughout the store. We are deeper down the chain with the retailers we normally work with, which has probably allowed us to go into even more stores.”
Marketing manager Peter Fuller concurs: “You’ll be in the pocket money area by the tills, on aisles, in dump bins… it really helps from a brand awareness point of view.”
A WHOLE NEW WORLD
The main focus for Mega at the moment is the arrival of its World of Warcraft line, which Price describes as its biggest launch for Christmas.
“We’re very excited and the hype is already really strong. There are ten million active users of WoW worldwide and we’ve done a lot to tease the product and share it with the fans; we’ve had a lot of interaction with them,” explains.
“Mega Brands as a company is very much about engaging the fans and having a two-way dialogue with them, getting their opinions and finding out what they’d like to see from us.”
Fuller points out: “The fans are the ones who tell us if something is wrong and we have a massive opportunity to create a bond between us and the fans. What we’ve created is what the fans want. Because it’s a world, there’s no end; every year there are new expansion packs. Where other games have a start and a finish, this one is a living thing, a developing world. It’s amazing to work with those assets.”
The other major news for Mega, of course, is the signing of Skylanders – the company will be producing Mega Bloks and Mega Puzzles based on the upcoming sequel, Skylanders Giants.
“There’s huge excitement in the trade that Skylanders is finally coming to traditional toys,” says Martin. “We think as we move into 2013 it’s a game changer for us. To have a licence that hot could be very exciting.”
The video games space is certainly a strategy which is working for Mega, and Martin says it will continue to look at possible options of where it wants to go next.
“But we’ll be careful to do it in the right way and make sure that any product line is absolutely right for fans, collectors and kids,” he says.
“We’re focused on executing World of Warcraft for now and ensuring we continue with all the great work we’ve done on Halo, particularly with Halo 4 coming. Then in 2013 we’ll see where we go.”
With so much going on, the main aim for the team is simply to continue the same growth pace as the first six months of the year.
“I would like us to execute everything we said we would, leading to an excellent sell-through at retail and great momentum into 2013,” comments Fuller.
Price agrees: “I would like us to have successful product launches with WoW and Skylanders.
“We have long-term brands and we want to build a strong base to propel us into 2013 and beyond.”
WORLD OF WARCRAFT: THE PRODUCTS
There are more than ten million World of Warcraft fans playing the online game, and Mega Bloks is confident that its construction range is going to perform “extremely well”.
“We have really tried to capture the intricate detail of the characters and authenticity of the scenes from the game,” says Mega Bloks UK marketing manager Peter Fuller. “We hope this will impress avid Warcraft fans and collectors across the globe, while at the same time we have brought to life a magical fantastic world that we believe will be equally as popular with kids.”
The Faction Packs feature articulated figurines, each intricately designed to represent a specific race/class combination, while the Mount Assortment and Barren Lands Chase offer further building opportunities.
Larger play-sets include the Sindragosa & The Lich King, Demolisher Attack and the Goblin Zeppelin Ambush, which are all game-inspired buildable battle scenes featuring customisable pieces and collectable figurines. Deathwing’s Stormwind Assault completes the range and features a dragon built from over 100 pieces.
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