Marvel Case Presentation from HBR Case . Marketing Readings

1. Soviljot Singh Behl Chetan Dua
Survhi Rathi Meera Thakker
Ishaan Srivastava Anurag Yelkur

2. 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

3. 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

4. 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

5. 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

6. Recognized projects till date…
FANTASTIC FOUR

7. Recognized projects till date…

8. Recognized projects till date…
THE INCREDIBLE
HULK

9. Recognized projects till date…
THOR

10. Recognized projects till date…
CAPTAIN
AMERICA

11. DIVISIONS
MARVEL
Comic Book
Publishing
Toys Licensing

12. Toys
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.

13. • 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.
Toys
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

14. Licensing
Marvel Studios
Marvel’s
Consumer
Media Group
Licensing
Licensed Marvel Characters
Feature Films
Television programs
Video Games
Animations
Destination Based entertainment(Theme parks)

15. Licensing – Motion Pictures
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 participation
Profit participation
Spider Man-most successful in terms of box-office
performance.
Licensed its characters for other media also such as
animated shows, video games.

16. Licensing-Consumer Products
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.

17. Company Objectives
• 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.

18. S.W.O.T. Analysis
Strengths
Weaknesses
Opportunities
Threats

19. 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
1994–1996
Fantastic Four
Iron Man

20. Strong brand equity
Rank 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

21. Strengths
• Publisher of comics
• Marvel Entertainment:
a)Reach
b)Visibility

22. Weaknesses
• Monotonous themes, products and services
• Only handful of characters obtained the level of ‘SUPERHEROES’

23. Opportunities
• Innovation
• Online Marketing
• Product line expansion
• Capitalize on the Low Market share

24. Threats
• DC Comics
• Torrent usage – less sales of movies and comics
• Intellectual property risks

26. CEO ACTIONS
• Elimination of unprofitable business lines
• Acquisition of other publishers and diversification outside of comic
book core
CONSEQUENCES
• Streamlining of operations
• However, mismanagement in non core areas
RESULT
• MARVEL FILED FOR BANKRUPTCY

27. • Toys Inc. took over Marvel TAKEOVER after it filed for bankruptcy.
•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

28. DIVERSIFY
PORTFOLIO
STOP
LICENSING
MORE
AGGRESSIVE
MARKETING
STRATEGIES
STRATEGIC
ALLIANCES
MANUFACTURING
OF PRODUCTS BY
MARVEL
NEW CHARACTERS

32. CREATION 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

33. 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