Building a New Category Through Licensing

The year 2014 has been notable for enticing several toy companies to enter the construction kit arena for the first time, thanks to the strong performance associated with these products—particularly the licensed portion of the market—over the last few years.

Licensed building kits, for both collectors and kids, have led the way:

  • Japanese toymaker Bandai used HALO and DC Comics to introduce its new construction line, SprüKits.
  • The Bridge Direct launched its C3 building brand with licenses including the NBA and WWE in fall 2014, with plans to add Monster Jam for spring 2015.
  • McFarlane Toys launched its first construction kits with The Walking Dead.

These deals trail Spin-Master’s acquisition of Meccano, marketer of the Erector brand, in 2013, followed by the launch of its new Ionix building line. The latter began with figures tied to the company’s internally developed TV/toy property Tenkai Knights; in 2014 it added licensed figures tied to Pokémon and DreamWorks’ Dragons franchise.

Of course these newer players have not yet cut into the share of market king LEGO, which pioneered licensing in this category with a multitude of properties ranging from Star Wars to Spiderman. Other established players also have a notable presence, including MEGA Bloks, which has multiple and diverse licensed lines with the likes of Assassin’s Creed and Hello Kitty; Hasbro’s Kre-O, which since its launch in 2011 has focused mostly on the company’s own brands, such as Transformers, supplemented by occasional licensed examples, such as Star Trek; and K’nex, which has rights to Angry Birds, NASCAR, and KISS, among others. All have been adding new licensed properties to their rosters.

The addition of a number of new players to this group within the last year represents an interesting illustration of the role licensing can play in helping manufacturers extend into new product categories.

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