Hasbro a player in digital gaming

By the end of this year, toymaker Hasbro Inc. will have launched a console gaming channel featuring two versions of “Monopoly” to start, plus a third version soon after and eventually “Trivial Pursuit Live” and “Risk.”
Competitor Lego, the world’s No. 2 toymaker, is already providing some of its toys on multiplayer gaming-delivery systems, but does not have a gaming channel for consoles such as Xbox and PlayStation. Hasbro, No. 3 in toy sales, and one analyst say the Pawtucket-based maker of popular “classic” board games is embarking on a path that is likely to broaden its reach among existing fans as well as introduce the products to new consumers.
“Lego does a lot of console gaming, but they don’t have a channel,” said Gerrick L. Johnson, an equity research analyst covering the leisure sector for BMO Capital Markets, a North American financial-services provider. “Hasbro is always eager to try new things. They go in … knowing a lot of things are not going to work out, but those that do, might work out spectacularly, so they’re much more aggressive than, say, Mattel is.”
Lego has console games produced by TT Games and WBIE, said Amanda Santoro, the Enfield, Conn.-based company’s brand-relations manager. She declined comment on questions regarding the potential impact of Hasbro’s new gaming channel. Mattel, No. 1 in toy sales, did not immediately provide comment.
Mark Blecher, Hasbro’s senior vice president of digital gaming and corporate development, says getting into the gaming-channel area of the digital space is good for the consumer, as well as the company.
Hasbro brands focus on four areas: digital media, toy and game product innovation, lifestyle licensing and immersive entertainment experiences.
“The Hasbro Game Channel gives players a way to experience multiple Hasbro brands like ‘Monopoly,’ ‘Trivial Pursuit’ and ‘Risk’ all in one destination,” he told Providence Business News. “It’s easier for kids and families to go into one place and have multiple games to choose from. It also gives parents peace of mind that all the games in that one spot are family-friendly.”
He also acknowledged, however, that a channel with multiple games on it provides the company with an “opportunity to introduce fans of one brand to other brands.”
In terms of taking a chance on a new digital platform, Blecher noted, “Our brands are well-known and well-loved, so that tackles one of the biggest hurdles in wanting to go into a new area.” Johnson points out that digital platforms have led to a declining market for physical games across the industry. For Hasbro, a gaming channel and marketing on consoles that enable multiple players to challenge each other digitally, while not being in the same physical space, is an “appropriate” strategy, he said.
“In games, [Hasbro] has some of the best, classic game brands, but kids have been glued to iPads, video and game consoles – any kind of screen,” Johnson explained, “so this is a way to get in front of kids.”
Whether Monopoly and Risk become wildly popular on consoles remains to be seen, but Johnson notes that it “doesn’t have to be a raging success for it to be successful.”
“[The board game] “Monopoly” usually happens when a parent says, ‘Hey kids, let’s play,’ ” Johnson noted. “When you’re playing it on a video game console, I don’t think it’s necessarily a kid’s first choice. They’re probably playing ‘Call to Duty.’ But it’s one of those things [Hasbro] probably put in the category of, ‘Let’s give this a shot.’ ”
“Monopoly Plus” and “My Monopoly” will roll out when the gaming channel launches, while “Monopoly Deal,” “Risk” and “Trivial Pursuit Live” will be incorporated into the new gaming channel in subsequent months, Blecher said.
Above all, Hasbro focuses on promoting brands that consumers can experience – and “Monopoly” and “Scrabble,” the popular word game, exemplify the values inherent in the brands, he said. The brand is so “compelling” that it can translate into different mediums readily, without necessarily mimicking the format and props of the original game, he added.
“We take our brand, like Monopoly, which has a core mechanic about owning everything, becoming wealthy and trading property, [and ask ourselves], ‘How do we take those core components and bring them into other mediums. That could mean a mobile game, a TV game show, a game on the Xbox. But that doesn’t mean it’s necessarily going to be square with 22 [street] properties and two dice.”
The social and connected capabilities of the gaming channel enable players to connect with others outside of their living rooms who are also using the consoles to play the game, Blecher added. For example, in the “Monopoly Plus” game, players can play with up to six people online, and they can take and display photos during the game so the other people they are playing with can see them. Ubisoft, a French video game developer and publisher known for such titles as “Assassin’s Creed” and “Just Dance,” has partnered with Hasbro to provide the gaming channel, and Hasbro’s first such channel is just the beginning, the company said.
“We will continue to work with Ubisoft and our other gaming partners to bring new gaming experiences to our consumers as our strategy is to bring consumers engaging play experiences with our brands across multiple platforms,” Blecher said.
For those not glued to a Playstation4 or Xbox One, two of the consoles on which the Hasbro gaming-channel games can be played, Blecher says the new gaming channel provides a way for consumers to play and compete without being in the same location – reaching far more consumers than traditional board games can.
The consoles are one type of digital platform that also includes Android and iPhone mobile platforms, as well as online platforms and applications and the personal computer. Scrabble can be found in all of these realms, Blecher says.
From a gross profit perspective, adds Johnson, selling physical board games is a shrinking business. The operating margin on a board game is still 20 percent, however. A toy company makes about $1.20 on every game sold to Toys R Us, he said, noting, “I doubt [Hasbro is] making $1.20 on each download.”
“At the end of the day, [Hasbro] would probably rather sell the physical board games than virtual representations of them through downloads because the economics are better,” Johnson speculated. “But if kids are in front of screens these days and are not at the kitchen playing board games, at least they’re investigating ways to reach kids where they reside.”
Hasbro does not disclose the revenue for digital gaming, said Blecher, but as one of four components of the company, it is a clear money-maker, he said.
“Most of our digital gaming today is a licensing business, so it’s not as large as if we were developing everything ourselves, but it’s very profitable,” Blecher said. “A licensed business is a profitable business. Operating costs are not substantial. Business scales, so there are no hard costs, there’s just pure revenue.” •

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