Cypress-based Bandai America Corp. wants kids to watch more TV.
The U.S. arm of the Tokyo-based toy maker has grabbed a large share of the action-figure market by linking its products to popular shows for children such as “Mighty Morphin’ Power Rangers.”
“We concentrate on entertainment-driven properties,” said Shin Ueno, vice president of marketing for Bandai America. “It’s one way to create innovative products that connect with kids.”
Power Rangers has been a home run for Bandai in the past decade. With help from the TV show, the toy company has been able to take one-fifth of the U.S. action-figure market, Ueno said. Parent Bandai Co. is the world’s third-largest toy manufacturer, behind Mattel Inc. and Hasbro Inc., with $2 billion in annual sales last year, according to company officials.
Development of Bandai’s toys is done in Japan. The U.S. unit handles sales, marketing, licensing and administration operations for North America, employing about 100 people.
Action-figure sales have slowed this year by about 25%, Bandai officials said. That’s partly because 1999 was a big year, fueled by the movie “Star Wars: Episode I: The Phantom Menace.”
“This year there was no movie,” Ueno said.
But Bandai, which is more closely tied to TV shows than movies, has a new hit with figures and merchandise based on “Digimon,” a Japanese cartoon that, like rival Nintendo Co.’s Pokemon, has struck a chord with kids here.
“Digimon,” produced by Power Rangers creator Saban Entertainment, just finished its first year and was picked up for a second season on the Fox Kids Network.
Other shows for which Bandai has the toy rights include “Xyber 9,” “Big Guy” and “Rusty.” A new show, “Escaflowne,” is due in October, while a show based on Bandai’s Heavy Gear products is the works. Last year, the company signed up with Sony Pictures Family Entertainment Group to help develop the Heavy Gear series.
Bandai also has seen growth in model kit sales of its Gundam Wing toy line, thanks to the “Gundam Wing” TV show, which has been airing in Japan for 20 years and came to the U.S. market last year. Gundam Wing toy kit sales now account for 40% of model kit sales at Toys “R” Us Inc. stores, Ueno said.
But Bandai has had its share of flops. The company spearheaded the Tamagotchi virtual-pet craze a few years back, but the fad proved short-lived. In 1996, Bandai teamed with Apple Computer Inc. to produce the Pippin Power Player, a game device that linked to TVs and featured Internet access. But the device made little headway and was scrapped two years later.
In Japan, Bandai has another battle on its hands, taking on Nintendo’s dominant Game Boy hand-held game player with its WonderSwan device. Bandai officials say they plan to launch the game player here next year.
The company has partnered with Microsoft Corp. to develop electronic toys that interact with the Power Rangers broadcasts. It also is working with Saban Entertainment and Microsoft to develop a toy that incorporates an interactive compact disc.
Bandai is constantly looking for new ideas for toys, Ueno said.
“It takes about two years to develop a property,” he said. “Seeds are being planted right now. I would like to plant a lot of seeds.”
To expand its global reach, last year Bandai entered into an agreement with El Segundo-based Mattel, the world’s largest toy company, to distribute, market and sell each other’s product lines in different markets.
Bandai, which has a strong presence in Japan and other Asian markets, is handling Mattel’s biggest products, including Barbie dolls, Hot Wheels cars and its Fisher Price line.
In return, Mattel is distributing, marketing and selling Bandai’s product lines in Latin America, a market where Mattel already has distribution, marketing and sales operations. Mattel will distribute all of Bandai’s products, but will initially focus on the Digimon and Power Rangers products.
“Each company has their own areas of expertise,” Ueno said. “Each company is doing something different in different genres.” n
