In 1977, George Lucas released “Star Wars” to rave reviews, quickly becoming a worldwide phenomenon. Almost forty years later, we are on the cusp of a seventh movie and Star Wars is alive and well.
Three years ago, Disney stunned the world when they paid George Lucas $4.05 billion for Lucas Films, the parent company and rights owner of the Star Wars franchise. Many thought it a hefty price to pay but I think Disney are a smart company and I’m certain a bunch of analysts would have looked over the number. So let’s be analysts for a moment and work out why they gave it the tick.
For the love of toys
So why did Disney acquire Star Wars? Thankfully, I think they’ve answered the question, at least in part for us when this month, Disney Stores hosted “Force Friday”, three months ahead of the new film.
“StarWars.com is thrilled to announce that Star Wars: The Force Awakens products will land in our galaxy on September 4, 2015, at 12:01 a.m. — “Force Friday” — with stores around the world opening their doors at midnight for a special celebration of all things Star Wars. It will be a day long remembered.”
Star Wars is the Guinness World Records for the “Most successful film merchandising franchise.” Could it be that this was always about the toys. Analysts predict that this could result in up to $3 billion in revenue for Disney.
Three reasons the toys are important
Here’s why Disney cares about the Star Wars toys (as much as the movies):
1. Disney is a character brand
Disney is a brand built on characters as assets. They are recognised for their uncanny ability to bring characters to life and they are so good at milking characters forever (Mickey is still going strong). It makes sense for Disney to look for and acquire companies that provide them with characters to add to their empire.
2. The Fans love the toys
Star Wars represents one of the most loyal fan bases on the planet, and this is attractive to Disney. If they can engage nostalgic parents, they’ll engage their children. For two years, Star Wars worked with the fans, consulting with them to make sure they got the merchandise right. Disney said its toy designers were “obsessed with the tiny details” and went to great lengths to meet with fans and get honest feedback. Star Wars fans are particular about the detail and so it was important for Disney to get it right. If they do (and I think they have), then it’ll be a big win for the company.
3. The Parks
With the parks, Disney has its own distribution channel and with increasing visitors every year, they aren’t running out of people any time soon. In 2014 alone, Disney enjoyed record attendances of 134 million people through the turnstiles and I don’t know if you’ve ever been to a Disney Park but let me tell you, that place puts you in the mood for merch. You’ll have 100 million little kids (and husbands) tugging at mum’s shirtsleeve begging for the latest Star Wars toy. As long as Disney continues to release more movies (and toys…and rides…and characters…and merch), the shirtsleeve tugging will continue.
Perhaps it was always about the toys. Maybe that’s what got the tick of approval. It does all rest on the movies though. They have to be great and I have no doubt the Star Wars franchise is in safe hands for the long term with Disney at the helm.