marvel case presentation
DESCRIPTION
Marvel Case Presentation from HBR Case . Marketing ReadingsTRANSCRIPT
Soviljot Singh Behl Chetan Dua
Survhi Rathi Meera Thakker
Ishaan Srivastava Anurag Yelkur
Original & Historic
• Born in October 1939 - SUBMARINER & HUMAN TORCH set the world alight!
• 60 years of story telling by Stan Lee and the mighty Marvel bullpen
• 40 years of animation, toys and consumer products
Rich & Complex
• 45 years of continuous plot evolution
• Single fictional universe of inter- relating characters and inter- twining stories all under one brand
• 5,500 characters: Heroes & Villains, Friends & Relations
Young & Old
• Adults: Grew up with Marvel characters
• Buy fashion apparel, collectibles, accessories…
• Adults love the comics
• Kids: Exposed to the movies, animation, books and video games
• Buy toys, school accessories, casual apparel, sleepwear, novelties…
• Kids love the comics
“CRADLE TO GRAVE” APPEAL
Here & Now
• Movies: • worth in excess of $4.5bn at Box Office
• Toys: • Hasbro – global toy partner
• Comics: • 400% uplift in 5 years
• Video Games: • Activision - over 20 million sold in 3 years
• Consumer Products: • over $6bn in sales at retail
FANTASTIC FOUR
Recognized projects till date…
Recognized projects till date…
THE INCREDIBLE HULK
Recognized projects till date…
THOR
Recognized projects till date…
CAPTAIN AMERICA
Recognized projects till date…
MARVEL
Comic Book Publishing Toys Licensing
DIVISIONS
In 2001, Entered into five and a half year exclusive licensing agreement with TBM, a Hong Kong based company.
TBM licensed the rights to manufacture and sell action figures that featured Marvel.
Toys
•Prices for end customers-$ 7 for average action figure & $15- $20 for role-play toys.
•Used to drive customer traffic for other products-T-Shirts, backpack etc.
Products
•Target Age group – 4to 12 years old boys.
•Collector Segment-for adults who have grown up with action figure.
Customers
•Specialty toy retailers, mass merchandisers , mail-order companies, independent distributors.
•66 % of sale by top 5 customers- Walmart , Toys ‘R’ Us ,Target , Kay-Bee Toy Stores and Kmart
Distribution
•Contributed 10% of total revenue in 2001.
•35% of the total revenue was from toys division in 2002.
Market Performance
Toys
Licensing
Marvel StudiosMarvel’s
Consumer Media Group
Licensing
Licensed Marvel Characters
Feature FilmsTelevision programsVideo GamesAnimationsDestination Based entertainment(Theme parks)
Pursued a diversified base of studio partners.
Marvel Studios’ executives were closely involved in film development process.
Two types of revenue sharing agreements with studios
Revenue participationProfit participation
Spider Man-most successful in terms of box-office performance.
Licensed its characters for other media also such as animated shows, video games.
Licensing – Motion Pictures
Sold licenses for a variety of consumer products- toys, apparels , accessories, footwear , collectibles , and food products
Till 2003, it had over 450 active license contracts.
Royalty typically ranged from 8%-15% but could go upto 30 % also.
Total Revenue from licensing -$ 318,000 in 2003.
Toys, Appeals and video games generated 50% of the Marvel’s licensing revenue.
Goal was to secure “best in class “ licensing partners in all major categories.
Licensing-Consumer Products
• To diversify geographically
• To carry out a market research of its audiences psyche from a superhero prospective
• To capitalize on the strength of prominent characters but at the same time also focus on the lesser known characters and try to turn them into potential blockbusters.
Company Objectives
StrengthsWeaknesses
OpportunitiesThreats
S.W.O.T. Analysis
Strengths
Film Production Films by Marvel:
Year(s) Series
1994–1998 Spider-Man: The Animated Series
1992–1997 X-Men
1996–1997 The Incredible Hulk
1994–1996Fantastic Four
Iron Man
Strong brand equityRank Licensor Sales
1 Disney Consumer Products $28.6Bn
2 Iconix Brand Group $12.0Bn
3 Phillips-Van Heusen $8.7Bn
4 Mattel $7.0Bn
5 Warner Bros Consumer Products $6.0Bn
6 Marvel Entertainment $5.6Bn
7 Nickelodean Consumer Products $5.5Bn
8 Sanrio $5.0Bn
9 Major League Baseball $5.0Bn
10 The Collegiate Licensing Company $4.3Bn
Strengths
• Publisher of comics
• Marvel Entertainment: a)Reach b)Visibility
Strengths
Weaknesses
• Monotonous themes, products and services
• Only handful of characters obtained the level of ‘SUPERHEROES’
Opportunities
• Innovation
• Online Marketing
• Product line expansion
• Capitalize on the Low Market share
Threats
• DC Comics
• Torrent usage – less sales of movies and comics
• Intellectual property risks
FUTURE & POTENTIAL THREATSTO MARVEL
CEO ACTIO
NS
•Elimination of unprofitable business lines
•Acquisition of other publishers and diversification outside of comic book core
CONSEQUEN
CES
•Streamlining of operations
•However, mismanagement in non core areas
RESULT
•MARVEL FILED FOR BANKRUPTCY
THE PROBLEM
TAKEOVER
•Toys Inc. took over Marvel after it filed for bankruptcy.
TAKEOVER
•Monetizing the content library by licensing products
•Managing for long term value
•Quality and Consistency in publishing division
3 Fold Strategy
•Toy design and marketing activities dictated by upcoming movie releases
•Earnings severely affected if child dislikes character
•Rivalry with DC – poaching of employees
FAILURE
NEW IDEAS
STOP LICENSING
DIVERSIFY PORTFOLIO
MORE AGGRESSIVE MARKETING STRATEGIES
STRATEGIC ALLIANCESNEW CHARACTERS
MANUFACTURING OF PRODUCTS BY MARVEL
SOLUTIONSCREATION OF
NEW CHARACTERS
Old characters lack connect
Monetary Value has been milked
Keep Manufacturing
Greater share in sales
Artists and Editors to have exclusivity
contracts
Characters to be licensed for
movies
LICENSING•Led to 15% increase in market share•Led to 20% jump in stock price
MOTION PICTURES•Marvel has to capitalize on the motion pictures
licensing and distribution•Of the business lines, motion pictures is the
fastest growing line•However Marvel retains only 7% of sales
Marvel Universe•Marvel Universe is greatest strength•It is a brand in itself, not a house of brands•Marvel should go ahead with new characters
and slowly phase out older ones – or introduce them sporadically to create novely
ADVANTAGES