In a statement that seemed to surprise investors and shareholders during the recent investors and shareholders conference call, Hasbro officially recognized Power Rangers as an “Emerging Brand” and NOT as a “Franchise Brand” as many investors and shareholders had assumed prior to the call. What is the difference?
Hasbro considers “Franchise Brands” as the flagship brands that carry the weight so to speak for the company. You will find Transformers, My Little Pony, and Baby Alive in this position. They are the sales drivers of the entire company. Some of Hasbro‘s licensed properties, like Marvel and Star Wars, are considered “Partner Brands”, which they rank right below “Franchise Brands”. And way at the bottom of the list is “Emerging Brands”. An “Emerging Brand” are your G.I. Joe, Littlest Pet Shop, and other low-market brands that you don’t see much of. In short – an “Emerging Brand” is a brand not quite good enough (yet) to be a “Franchise Brand” in regards to overall sales and growth.
The placement of Power Rangers in “Emerging Brands” and not “Franchise Brands”, seeing as Power Rangers is one of the leading live action boys brands in the world, seemed to confuse investors and shareholders. The following exchange happened between one such member and CEO Brian Goldner on the live call:
Linda Bolton-Weiser (Analyst, D.A. Davidson)
Can I just ask about next year? I know you don’t wanna go into too much about next year, but when we think about Power Rangers, it sounds like you’re going to be recording that in “Emerging Brands”. That surprises me being that it could have a substantial revenue opportunity and you’re going to treat it as an important franchise. So, can you just talk about when we could first see revenue? Would that be in April or a very small revenue in the second quarter? Is there any way you can talk about the Power Rangers expectations for what you’re doing that next year?Brian Goldner (Chairman & Chief Executive Officer, Hasbro)
Sure. First, you’re already starting to see some of the Power Rangers licensing revenues come into the company. And we indicated that in our Entertainment & Licensing business. And then in terms of toys and games product sales, that really begins in Q2 next year. There’s a sell-off period for the prior product which is first quarter. We feel like putting Power Rangers in the “Emerging Brands” category is a good place to start. But you’re right. It certainly, in our estimation, is a “Franchise Brand” in the making. And we’re hoping and we’re certain that our great team that is working on the brand out of the west coast is very focused on ensuring the brand becomes a “Franchise Brand” in the future.
So, TLDR, what does this mean?
Because Hasbro doesn’t get to take full advantage of the property until the previous licensing agreement with Bandai runs out in April of 2019, Hasbro has decided to keep Power Rangers in the “Emerging Brands” portion of its portfolio. The revenue stream from the Power Rangers brand in terms of merchandise won’t even hit the books until Q2 reports come in and even then they will be low due to the trickle effect of product hitting retailers in waves. It may very well take a full calendar year for Power Rangers to work itself in to a “Franchise Brand” due to market saturation and post-Christmas inventories.
So don’t hit that panic button just yet. However, if Power Rangers fails to meet expectations from Q2 2019 to Q2 2020, we wouldn’t be surprised to see Hasbro leave it as an “Emerging Brand”. It will be interesting to see the direction Hasbro takes the brand out of the gate. Stay tuned!
Story - Power Rangers Ranked as "Emerging Brand" and not "Franchise Brand"
Shareholders and investors thought Hasbro would list Power Rangers as a "Franchise Brand", what with their half-a-billion-dollars purchase of the property. Instead, Hasbro listed it as an "Emerging Brand", which is where you find properties that are both 1) working their way to Franchise Brand and 2) no longer have sales to support being categorized as a Franchise Brand.
It's basically the nice way of saying "You're not good enough (yet)". But "Emerging Brands", traditionally, have low market saturation, low visibility, and very little marketing.
IE: "Franchise Brands" at Hasbro generate up to 8 times the sales volume as "Emerging Brands", despite "Emerging Brands" having more properties in that category.
This might explain why we have seen so little from Hasbro: the license with Bandai hasn't actually expired yet!
From a business standpoint, Hasbro's conclusions make sense! P.R. hasn't done anything for Hasbro to speak of.
For this to work, Beast Morphers MUST succeed!
Even if you don't like the adaptation that results (which I can't imagine happening at present), then consider getting the Lightening Collection and figures that feel natural to Go-Busters.
P.S.: What does "TLDR" mean?
TLDR is short for "Too long, Didn't read."
Anyway, Hasbro is definitely playing things safe. They obviously spent a HUGE amount to acquire the rights so going all-in right out of the gate would be way too risky.
Still, reports we have so far suggest Beast Morphers will start in February (like past seasons). If the first merchandise isn't out until APRIL... that could be a major misstep.
Technically it is an emerging brand. It's an investment with no returns as yet. I'd accidentally called it that myself yesterday on other forums about the conference call. xD
But given less than 5 years, it'll become a mainstay franchise brand under hasbro that's pulling in big bucks. Hasbro and Toei have big plans coming up. Sit back, and enjoy the ride. Power Rangers is about to become cool again. So get ready to put your shades on~
Initial hiccups are expected though and won't impact the brand as a whole much. 2019 is considered a "transitional year" with sales picking up in later quarters anyway, especially with the winter holiday shopping point, but major expectations aren't going to start filtering in until likely year 3 of their acquisition. Years 1 and 2 are build up, with sustaining revenues from wider licensing and ad revenues with some direct merchandise avenues too. With Hasbro owning it all. Unlike Bandai/Saban, they get all the revenues outside of the Toei royalties.
But general "threshold bars" won't be implemented on the show itself until year 2 or 3, with likely more on year 3. Lightning collection is wider brand/franchise based so its release in Q2 or 3, has to sustain itself enough. But Beast Morphers material has a grace period on its 'normal lines'.
Power Rangers is a long term investment. Immediate returns aren't expected yet fully, though royalties are already coming in from wider licensing, and the true value of the brand is what it can become under their hand in the coming years. So 2019 will be good, but a little rocky. With 2020 and 2021 building better, with 2022 and 2023 extremely strong years, and 2023 forward keeping the momentum going.
In general, this what makes Beast Morphers interesting though too. As brand years go, this one has the most freedom to focus on story and character development. Which could prove well for the show as a whole.
The series after will keep momentum. Then we get into the 30th, as well as the next movie, and everything after is "let's get ready to rumble" style epic to keep the hype going. They're seemingly adapting brand blueprint to it, so this bodes well for wide media with great action, strong endearing characters, and heart string pulling/emotion stirring heartfelt stories. And we will get comic based toys too. Hasbro has never been shy about that in their other brands. Including Transformers where Generations ran sustaining on IDW designs from T30 all the way through CW.
But given less than 5 years, it'll become a mainstay franchise brand under hasbro that's pulling in big bucks. Hasbro and Toei have big plans coming up. Sit back, and enjoy the ride. Power Rangers is about to become cool again. So get ready to put your shades on~
It'd be smart for Mega Construx and other extended brand partners to take advantage of it though.
Initial hiccups are expected though and won't impact the brand as a whole much. 2019 is considered a "transitional year" with sales picking up in later quarters anyway, especially with the winter holiday shopping point, but major expectations aren't going to start filtering in until likely year 3 of their acquisition. Years 1 and 2 are build up, with sustaining revenues from wider licensing and ad revenues with some direct merchandise avenues too. With Hasbro owning it all. Unlike Bandai/Saban, they get all the revenues outside of the Toei royalties.
But general "threshold bars" won't be implemented on the show itself until year 2 or 3, with likely more on year 3. Lightning collection is wider brand/franchise based so its release in Q2 or 3, has to sustain itself enough. But Beast Morphers material has a grace period on its 'normal lines'.
Power Rangers is a long term investment. Immediate returns aren't expected yet fully, though royalties are already coming in from wider licensing, and the true value of the brand is what it can become under their hand in the coming years. So 2019 will be good, but a little rocky. With 2020 and 2021 building better, with 2022 and 2023 extremely strong years, and 2023 forward keeping the momentum going.
In general, this what makes Beast Morphers interesting though too. As brand years go, this one has the most freedom to focus on story and character development. Which could prove well for the show as a whole.
The series after will keep momentum. Then we get into the 30th, as well as the next movie, and everything after is "let's get ready to rumble" style epic to keep the hype going. They're seemingly adapting brand blueprint to it, so this bodes well for wide media with great action, strong endearing characters, and heart string pulling/emotion stirring heartfelt stories. And we will get comic based toys too. Hasbro has never been shy about that in their other brands. Including Transformers where Generations ran sustaining on IDW designs from T30 all the way through CW.
2. Now that you bring up IDW, seeing as we have no PR comic info for March which is the rumored date for Boom Studios to lose the PR comic rights, it's possible IDW will be getting PR comics next year as well. Seeing as IDW does comics for every other Hasbro franchise. Also the fact the IDW Hasbro comic Universe is going to be rebooting soon, and the PR comics are in the middle of their rebooting, it would be the prefect time to move PR to IDW. And from what I seen online Beyond the Grid is not doing that great, and fans aren't pleaseed about having to read Go Go so they can read something about the MMPR team when they want to read about the MMPR team after Shattered Grid. So yeah I can see PR comics moving to IDW next year.
Full Thread: Hasbro Investor Call - Power Rangers Listed as Emerging Brand
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