Why Does Skylanders Succeed while 90% of App Toys Fail?


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1400x960-H-Brands-Skylanders-031515
One
of the disappointments of 2012 was the failure of what was deemed to be a
powerful new category of play:  App Toys.
   Why did this happen, particularly in light
of the spectacular success of Skylanders?

Many of us in the toy sector have our
opinions but why
not turn to someone who is a member of the digital play segment?  That’s what I
decided to do and by making that effort found an excellent article on GAMEZEBO
by Lloyd Melnick aptly entitled:  “Why
app toys fail and Skylanders soar
.”

Lloyd Melnick
has a long history in gaming (He is
currently Managing Director
at
the Verus Entertainment
Group
) so his perspective is from the digital side.  I have attempted here to summarize his points
and to have provided some points of my own. 
I do, however, strongly suggest that you read his entire article.

He begins by pointing out that a number of
big players made the effort this year but size did not seem to matter.  Here is how he puts it:  “Among the failed app toys were Barbie Dolls
and Hot Wheels cars with special conductors to control games on a tablet from
Hasbro, Disney’s Cars
AppMates
, and a version of the Game of Life from Hasbro.”

He
sees the essence of their failure as deriving from the undisputable fact that
these are traditional toy companies attempting to play in the digital space
.  This is the opposite of Activision’s
Skylanders which is a digital company entering the traditional toy arena. 

Why though, does this give the digital player the
advantage?  Melnick has an answer and puts it this way:

The biggest problem with app
toys is that the toy makers are simply
trying to move the same product to a new platform
. The toy companies do not
understand what creates compelling experiences on tablets (or consoles or
phones, for that matter). Instead, they
are replicating the same experience people have with the physical goods in the
virtual world, which is not what consumers are looking for.

In addition, Melnick says that in some cases the app merely functions as a gimmick rather than an
enhancement
.  He points to the app
spinner for the Game of Life.  He notes
that ultimately it doesn’t do anything differently than a plastic spinner.  If there is no advantage, why does it exist?

Particularly interesting to me was his notion that a big
part of the problem for toy companies is that they “…are used to developing—and
are still developing—for retail, where there is a single discrete purchase,
driven by distribution, advertising, and point of purchase promotion.”  In other words, their essential business model gets in the way.  He speaks about “lifetime value” which is the notion


that a digital toy employing
the digital business model is intended to generate revenue by using a fan’s
interest in a game that they, using his powerful word, “love.”    The
more you are into the game, the more you are willing to pay for add-ons and
enhancements.  He ends by cautioning:  “They
[toy companies] must understand new business models and ways to appeal to
customers after doing business the same way for 50 plus years.”

Lloyd Melnick has given us a great deal of food for
thought.  My thoughts are:

  • Are toy companies actively seeking digital
    play talent?
  • If they are, are they truly willing to forgo
    preconceived notions of business and play in order to allow that digital talent
    to have an impact?
  • What traditional toy companies are there than
    can truly emulate the Skylanders model?
  • What other digital companies will emulate
    Activision and enter the traditional toy space?
  • What will this kind of competition mean for a
    traditional toy companies and how will retail buyers accommodate their entry?

These are my questions. 
What are yours?

 

 

2 thoughts

  1. @Brian- Yup, yup. App Blaster was a good example. The problem I believe is having to pay the royalty rate on top of everything else. T-Comps believe that it’s just easier to make the content themselves, and have full control. They’re certainly not digital game developers, and as a result, the playability always takes a backseat to the product. The product is their comfort zone. Also, asking a game developer, or multiple developers, to add functionality to their game titles? It’s tough to get them to agree to anything like that.
    Recently I went to the 99 Cents Only store and picked up several of Hasbro’s My3D glasses (originally retailing at $30 a pop). Kind of the same thing, where it was supplemental toy, but the content failed to deliver an “experience” in my opinion. I would be curious to hear thoughts on that as well.

  2. I still believe the deepest source of app toy failure stems from an inability on the part of manufacturers to ensure expectations are delivered upon. Skylanders focuses primarily on in-game play as opposed to physical/tangible play, but harnesses collectability at the same time. While Skylanders is far from the perfect synthesis of digital-physical play, it does meet (and exceed) customer and user expectations.
    Case in point Spinmaster’s App Blaster, released two years ago. Customers expected a digital-physical hybrid experience that captured the very best of digital first-person shooters and physical Nerf or Super Soaker play. Instead they got an inferior experience on both sides of that equation. The equation is simple: crappy toy + crappy video game = crappy product. And it isn’t just App Blaster, obviously. A failure to meet and understand customer and user expectations (mom’s for purchase, kid’s for play) has resulted in some pretty lame toys. Mattel’s AppTivity products similarly fail to create a genuinely engaging experience.
    Skylanders and Furby are among the few successes in the category, and rightly so:
    – Meet the expectations of a digital consumer and player
    – Meet the expectations of a physical toy/game consumer and player
    It really is that simple.

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