viewpoint In a deal worth $460m, the first major (and David
Ripley Chief Operating Officer of Winning Moves
Mattel’s ‘mega brands’
“I’m from Mattel. Well, actually I’m from a smaller company that was purchased by Mattel in a leveraged buyout.” - Rex: Toy Story, 1995.
probably the largest) toy industry leveraged buyout of 2014 has been agreed between Mattel Inc and Mega Brands Corp - this tie-up will give Mattel a strong position in the construction toy, art and craft and puzzles categories, whilst ensuring their number one overall toy market position is further galvanised. In the UK market alone, Mattel averaged market
share of 9.5% in 2013; this combined with Mega Brands’ average of 1.1%, will ensure that an enlarged Mattel Corp will remain at least 2% points ahead of second placed Lego with an average of 8.5%. It will be interesting to see how Mattel applies its world-beating brand and R&D capability to
the established art and craft and construction toy expertise of Mega Brands. Mega Brands also boasts a strong licensed
property line-up with the likes of Skylanders, Halo and Power Rangers, which will all complement the existing Mattel licensed product portfolio. Beyond the Mattel deal, the first quarter of 2014 has seen a flurry of corporate activity on both sides of the fence and significant movement amongst the senior echelons of several UK-based toy and licensing companies. Senior personnel changes in particular feel
very ‘fluid’ and significantly more numerous than recent years, but this may simply be a symptom of businesses positioning themselves for a period of industry growth; fingers crossed.
Dan
Salem Prism Digital
Solutions Kids’ screen time
With on-demand, streaming subscription sites and apps, kids can now find the shows they want whenever they want them. Moreover, the fact many kids love watching ‘TV’ on tablets increasingly more than on the traditional television set, could spell trouble for the channels currently targeting kids. This may be a symptom of parents’ own perception
of controlling their kids’ visible screen time on the main TV, while the children gladly return to their bedrooms to play (or watch shows secretly on their tablets on the bed, I know that’s what my kids do). According to recent research from US youth and
family research firms, services such as Netflix and YouTube are now competing on equal footing with kids’ television channels - and in some cases, winning. YouTube is the second-highest rated ‘network’ in
terms of brand awareness and popularity amongst kids, falling just behind Nickelodeon and surpassing Disney Channel. Meanwhile, Netflix is the second- fastest growing ‘network’ and ranks just behind Cartoon Network. One reason these network alternatives are faring so
well in the kids market is because kids see no difference between surfing channels on TV or surfing for content on a streaming site. As long as they find an entertaining show or video, they’re happy. Not only do streaming services deliver fun video content, kids also say they’re easy to use, convenient, portable and always offer something new. And those are features which not all the broadcasters have mastered. Although every channel has a website and many have apps that allow for on-the-go viewing, according to new
100 Toyworld
research streaming services rate far more highly. Even if you take some of the US findings with a pinch of salt, we are already seeing some similar trends here in the UK. Another major factor at play in kids’ perceptions of their viewing options is that channels tend to limit the video content available on their websites and apps, while streaming services don’t. In a world where access is no longer a barrier, it’s content - the quality, amount and variety - that sets streaming services apart. From a kid’s point of view, Netflix and YouTube are one-stop shops for all their video needs. YouTube is often the first stop for streaming video.
Kids have come to trust that they’ll always find something fun and interesting - not only does it have cool and silly videos featuring kids just like them, it also has clips and episodes of their favourite shows and music videos from their favourite artists. The site holds endless possibilities because there is always something new to discover and explore. YouTube is especially popular with older kids. As they enter their tween years and develop stronger personal interests, they want to explore those interests and broaden their worlds. YouTube offers the ideal venue. In their eyes, the site has a little bit of everything, from design ideas for their Rainbow Loom, to how-to sports videos. It even offers homework help. Of equal importance to tweens, who are just beginning to deal with social pressures, it provides the opportunity to discover the next hot video and be the first to tell their friends about it. As with Netflix, YouTube’s longish history adds to
its awareness among kids and families, but it’s had to repair its reputation to win over families. Mums might have once been concerned about what their children would find on YouTube. However, many have stopped worrying and come to realise the site’s value as an educational tool for their children. Netflix sates kids’ desires for instant access to the
programmes they want to watch. The once movie- based service has gathered a broad range of kids programming, including content from Disney Channel and Cartoon Network, as well as niche shows and original series, all in one place that’s easily accessible. In short, kids know they can always find shows they like. Netflix draws in viewers through deals with networks
for well-known shows, but once in the door, kid viewers are delighted to discover a wealth of content. Nearly half of kids (45%) say the brand offers “great variety and choice” and the same proportion says it “always has new things,” far surpassing linear networks on both counts. Younger kids are generally less concerned about having the latest episode of shows, a common complaint among adult Netflix users. They’re happy knowing they can always find a few episodes of their favourite shows to watch (over and over again). Moreover, they can tell that Netflix cares about them because it offers the Just for Kids section. There they can control their own viewing, a key selling point for this demo, which is delighted with each step it takes toward independence. Of course, not all streaming services are created
equal. While Hulu has steadily grown in popularity among adults, it has yet to crack the kids market. It treats kids as a secondary audience while concentrating on pleasing older viewers. Hulu’s primary selling point, that it offers the latest episodes of shows before other streaming services, doesn’t resonate with kids, whose favourite TV shows rarely end with cliff hangers or suspense. An episode they’ve seen 100 times is as satisfying to watch as the most recent one. YouTube, Netflix and to a lesser extent Hulu,
have become part of families’ routines. In the car, at Grandma’s house, at bedtime, streaming video services fits parents’ and kids’ always-on lifestyles. They appeal to the whole family for a variety of reasons, whether it be bringing the group together to enjoy a movie night with Netflix, or solving a homework problem together with a little help from YouTube. The success of streaming services is bittersweet news
for traditional channels. Streaming sites and apps can be strong distribution partners, but they are also stealing viewers’ time and brand affinity. Streaming services may owe their popularity in part to traditional TV networks as content partners, but it’s their ability to meet the lifestyle needs of kids and families that has allowed them to compete directly with networks. The future of kids viewing is there for the taking, but the traditional players need to be able to move quickly and react to the ever changing environment and demands from kids and their families.
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