Disney Animated Films
Topic: Pixar: Disney's Cash Cow? (The Aftermarket Thread)

#	Author	Message
1	DlandDug Thu 6/18/2009 2:15p	Over in the box office thread some interesting observations were made about Pixar films and their after market profitablity. Since that wasn't really the discussion topic over there (which alternates between nerdy number crunching and chest thumping over box office receipts), I am starting a new thread to discuss this topic over here. All kidding aside, it's a compelling subject (which will probably alternate between nerdy number crunching and chest thumping over merchandising receipts). This is the statement I wanted to address: >>It doesn't take a rocket scientist to figure out why sequels are being made of Toy Story, Cars, and now Monsters. It's all about pre-sold franchises which do gangbuster business in the aftermarket. And these three film franchises are HUGE revenue generators regarding toys.<< So much to chew over. First off, I think that using Toy Story and Cars is a really bad choice for this thesis. Monsters, Inc, too, but for completely different reasons. I haven't really ever paid much attention to the marketing revenue from Monsters, Inc. Anyone have hard figures? Is Monsters, Inc. really a marketing bonanza? If so, I stand corrected. Toy Story became a marketing phenom despite an incredible amount of opposition. When the first film was introduced, nobody at Disney had any faith in the merchandising. At least, it sure seemed that way, what with a single small toy company (Thinkway) producing a limited run of a few toys the first Christmas season. Toy Story 2, on the other hand, was rolled out as if it WERE Christmas. Overkill, in my opinion, but the toys did quite well, and the franchise is firmly set in place. But is it Disney's insatiable demand to sell toys that is driving Toy Story 3? Has Pixar sold their sould to their corporate masters? Have Buzz, Woody and the gang been put to work in a Chinese sweat shop? (Cue dramatic stinger...!) Actually, the whole Toy Story sequel saga has been hashed and rehashed so many times, it's hard to know what the whole truth is. But this much we do know. Toy Story 2 was a big part of the original friction that developed between Pixar and Disney. (Or rather, Pixar and Michael Eisner.) It seems that Mr. Eisner felt that TS2 was not to be counted in Pixar's original agreement covering five films. He insisted that Disney owned the theatrical rights not only to Toy Story, A Bug's Life, Toy Story 2, Monsters, Inc., and Finding Nemo, but the next film (The Incredibles) as well. Pixar cried foul, and the whole thing became increasingly contentious. Worse yet, Toy Story 3 turned into a bargaining chip. You see, Pixar loved Woody and the gang so much, they actually had projected a trilogy. (Details of the third film have been floating around the internet for years.) It was not Disney, but Pixar's creative team itself that wanted to continue Toy Story beyond the original film. Since Disney essentially owned the rights to use the characters of "their" Pixar films, they began developing their own Toy STory 3. Yep, the team who brought us Dinosaur, Chicken Little, and Meet the Robinsons were going to wield creative control over the final disposition of Pixar's beloved Andy's Room gang. Long story short (too late!), Bob Iger negotiated an agreement, Pixar and Disney became a team (sort of, as Henry might say), and the Disney-led Toy Story 3 effort was disbanded. Pixar's Toy Story 3 was most emphatically not developed on the basis of simply selling stuff. It certainly will sell stuff, but the poignant tale of what happens to toys after their owner (Andy) outgrows them is a logical finale to a wonderful story. A toy story! (And it will move a LOT of toys, incidently. And I do mean incidently.) Cars is a whole other kind of toy story. I will save that for the next post.
2	DlandDug Thu 6/18/2009 2:31p	Cars is almost certainly John Lasseter's most personal film. His father was an auto dealer, Lasseter has become a major NASCAR fan, and a Lasseter family trip across much of historic Route 66 are all part of the DNA that resulted in Cars. But who here recalls the initial reaction to the announcement that Pixar was making a movie about... talking cars? It ranged from indifference to outright derision. (Except from the cheerleaders, who, as usual, just trusted Lasseter and the Mighty Lamp.) Cars was obviously going to be trite, obvious, and little more than a two hour Chevron commercial. Worse yet, how could anyone create talking cars that kids would find cute 'n cuddly? And how many toy cars were already being sold every year, anyway? Pixar and Disney would never be able to penetrate THAT oversaturated market. Long story short... Cars created not just a bunch of compelling characters that kids fell in love with, but a whole world. Yes, the film played far better in America than it did overseas (it was, after all, a fairly personal story from a very American guy). So it makes sense to take these characters and send them out into the world. They can meet other cars from other cultures? What a concept! Oh... and the cars sell pretty well, too.
3	Dabob2 Thu 6/18/2009 5:20p	Just showing that film quality and after-market don't necessarily have anything to do with each other, Cars is easily the most successful after-market merch machine for Pixar, but is generally considered their weakest film artistically. I agree with that; I liked it, and some things about it are very good; but it's the only Pixar film I didn't love, and I could see the formula "gears" moving in too many spots.
4	Dabob2 Thu 6/18/2009 5:21p	And now I've just gone OT, talking about film quality in an after-market thread. Sorry!!
5	Ursula Thu 6/18/2009 5:31p	I don't know from after market, but I do know that the first time I saw the Toy Story 3 teaser thingie, I cried. I missed my friends and I was so happy to see them again. And then I started looking for my Buzz figure. And our 3-year old friend Evan LOVES the Cars cars. They are cartoony enough for him and story-driven enough for us to play them with him making up our own stories of what Lightning and Ramone are up to. I guess what I'm saying is that with Pixar movies, the story and the characters are so good, they do lead to after market purchases because we like the characters so much. Having a 2 or a 3 of something just means we get to spend more time with them. I think the rocket science needs to figure out how to get other movies to create such great characters.
6	Ursula Thu 6/18/2009 5:32p	or rocket scientist, even.
7	Mr X Thu 6/18/2009 6:37p	***Toy Story became a marketing phenom despite an incredible amount of opposition. When the first film was introduced, nobody at Disney had any faith in the merchandising.*** If so, whoever made that call is myopic beyond belief. I remember talking with friends when we first heard of Toy Story about how brilliant it was from a marketing perspective to make a movie ABOUT toys (in other words, made for marketing).
8	DlandDug Thu 6/18/2009 8:06p	It was an incredible blunder, further compounded by the choice of the rather small company that did get the license. Thinkway was a tiny educational company, and they did not have the wherewithal to mount a major campaign. It took some time to get the master license into the hands of a company that really knew how to handle a major property.
9	leemac Sat 6/20/2009 7:55a	<<It was an incredible blunder, further compounded by the choice of the rather small company that did get the license. >> It wasn't out of choice. Mattel was already trying to extricate itself from their licensing deal with Disney as they had seen diminishing returns since The Lion King. Hasbro was in the middle of a reorganization. And that is the global toy market. There just wasn't anyone willing to take a punt on the movie. Thinkway knew how to create electronics toys which is why the "talking" Buzz and Woody were released. Inventory availability wasn't Disney's fault - it was down to Thinkway misreading the market. Thankfully Thinkway have remained a partner with DCP and their product on Wall-E was exceptional. One of the issues with the recent movies is a lack of aftermarket. Neither Ratatouille or Wall-E will last in the public's consciousness. Up may be a box office phenomenon but it just doesn't have marketable characters. When you are spending close to $200m on a movie (I'm told Up was $180m) you need to be able to bolster the take with consumer products. Relying merely on box office grosses and DVD rentals/sales just isn't the Disney way. DWA still hasn't found a way to crack the consumer products nut despite having movies that are very popular and have potentially marketable characters. Kung-Fu Panda was a massive success but didn't spawn any additional revenue streams. Ultimately Disney/Pixar need to get the right balance. My concern of late is that Pixar is creating very expensive arthouse movies like Wall-E and Up (and all of the non-sequels on the roster) whilst Feature Animation is pandering to the juvenile set with the likes of Bolt. There needs to be an appropriate balance struck. Too many other parts of the business rely on the engine of the Studios to create product that reaches the mass market. I hope that The Princess and the Frog becomes another The Little Mermaid but there is a lot riding on it.
10	DlandDug Sat 6/20/2009 5:16p	>>It wasn't out of choice. Mattel was already trying to extricate itself from their licensing deal with Disney as they had seen diminishing returns since The Lion King. Hasbro was in the middle of a reorganization. And that is the global toy market.<< I didn't intend to imply that the blunder was on the part of Disney, but rather the toy companies themselves (yeah, I'm lookin' at you, Mattel). There were also other players who certainly could have stepped up and done a better job than ThinkWay. Tomy was a global player at the time, and Playmates has had a long term relationship with the company. I absolutely agree that Ratatouille and Wall-E do not lend themselves well to after market. But I think it would be a mistake to assume this means all future production should be approved only with the "assurance" that a popular toy line could be developed. By that criteria, I doubt Cars would ever have gotten off the drawing board. DreamWorks inability to keep toys in the stores is a puzzler. Shrek should, by all the usual measuring sticks, be a big hit at Target and Toys 'r Us. Almost makes one believe that it's best to just make great films and hope for after market lightning to strike. (I am dying to see if DreamWorks is able to cash in on the immense popularity of the TV series Penguins of Madagascar at the toy store!)

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