Activision Exec on 'Skylanders' $500 Million Hit Kids' Franchise (Q&A)

Skylanders Giants - H 2013

Activision Publishing has focused on the lucrative children's market over the past two years with a hybrid toy and video game that has captivated the market.

Call of Duty isn’t the only hit franchise that Activision Publishing has these days. The game-maker has seen its kids' toy and game franchise, Skylanders, generate over $500 million in U.S. sales over the last two years. Skylanders Giants, the latest cross-platform game in the franchise, generated more than $195 million in sales of games, accessory packs and figures. Together, Skylanders Giants and Skylanders Spyro's Adventure figures have outsold the top action figure lines in the toy category, including Beyblades, WWE and Star Wars.

The franchise, which connects the worlds of video games and action figures, was conceived by developer Toys for Bob and Toy Story scribes Alec Sokolow and Joel Cohen. John Coyne, vice president of consumer marketing, Activision Publishing, talks about the franchise in this exclusive interview.

The Hollywood Reporter: Who’s playing these Skylanders games?

John Coyne: Because of the toys, the game tends to skew a little bit younger. Our core audience is kids six to nine years of age. However, we do find because of the innovation and the fact that it’s a good game to play, teens and families are all playing the game as well. There’s something that resonates with everybody, no matter what your age. There’s something fun about having a toy that you then use to drop into the game and bring into real life; it’s something that everyone tends to enjoy.

THR: What are you seeing with the collector aspect of this franchise, with consumers buying all the figures?

Coyne: We know from the numbers that we’re seeing people going above and beyond the Starter Pack when it comes to the figures. Some people go very deep into the franchise, while some people are more choosy about the characters they want and only buy a couple extra ones. With the volumes we saw on Spyro, and even more so with Giants, when you do the math you see people are attaching a lot of toys to the Starter Pack. We’re also seeing a lot of new people coming into the Skylanders giants through Giants. We’ve captured a new group of Skylanders fans, who then may go back and play Spyro.

THR: What do you think it is about the Skylanders franchise that has allowed the franchise to grow and beat out more established brands?

Coyne: I think it’s the innovation. There’s something very powerful in what we did in bringing together two things that kids love – toys and owning something physical and the deep immersive play of a video game. The cool way we did that, that innovation, has helped drive the franchise. It was the first time it had been done in this way. Kids also find it very magical that the toys remember everything they’re doing in the game. You can play at your house with your set of characters and then bring them to your friend’s house and still drop your characters into their game and play with them.

THR: What are the challenges of connecting with today’s kids audience?

Coyne: Kids are a difficult audience to please. The gaming experience itself is critical to this franchise and their engagement. There have been plenty of games that have been done for kids that maybe weren’t as good, as games, as they could be. The focus we’ve had on delivering an “AAA” game has been critical to the success and engagement of Skylanders. If you’d bought a Starter Pack and not found it fun, you’d quickly walk away from the franchise.

THR: What role do you see Hollywood franchises playing in the game industry today with kids?

Coyne: A franchise is a franchise, and having worked at Mattel and other companies, I think kids want more of their favorite characters. If Toy Story didn’t have the toys and games and everything else, I think kids would be disappointed. Building Skylanders from the ground up is a more difficult route to engage in, but if you hit a home run with it -- like with other great gaming franchises -- we hope we keep our audience. Kids, as an audience, are becoming more savvy and more critical about the games they may or may not want to play. Not only with gaming, but even if you look at kids’ movies. Companies like Pixar and DreamWorks have taken that approach with families and kids and invested in quality movies, and that’s a model that has worked well.

THR: Do you see Hollywood potential for Skylanders as entertainment?

Coyne: I can’t comment on that. We’re definitely seeing a great success as a franchise from the licensed goods in the marketplace, whether it be apparel or toys or backpacks. We’re seeing success that the characters we’re creating are resonating with our audience. That gives us great belief in the franchise going forward.

THR: Why do you think we haven’t seen as many Hollywood-licensed kids' games today?

Coyne: I look at gaming and my own son, who’s seven, and he spends a fair amount of time engaged with characters in games, as he does with characters in a TV show or movie. Kids don’t segment entertainment in the way we do. They see spending time with characters in a game or a TV show or a movie in a similar way. If anything, gaming is more engaging, because you’re controlling what’s happening. What’s interesting when you look at the Skylanders numbers is that Giants eclipsed the box office numbers for some great family movie releases last fall, like Wreck-It Ralph and Rise of the Guardians. Kids and families are willing to spend the same amount of money on Skylanders as some of the great family movies.

THR: Why do you think we haven’t seen other game companies replicate this new game genre yet?

Coyne: It’s difficult to do. The original Skylanders was a long time in development. Delivering that level of quality and innovation and that number of toys and meaningful characters is a big undertaking. I’m sure people have looked at it and other things are in development, but it’s not easy. That’s why we’re so pleased with the results of this. Trying something new and trying to chart a new course for games and toys was something not a lot of companies would have the heart for.

THR: What role did the Toy Story Hollywood writers play in the success of this franchise?

Coyne: Not only the Toy Story writers, but our overall philosophy on the importance of story and strong characters and quality have all played a big part in the ultimate success of this franchise. That’s something we continue every day to make sure we don’t lose sight of that. Those writers did help bring that level of quality and sophistication to the story aspect. 

THR:  Skylanders Giants is out on Wii U. What role will the new consoles from Sony and Microsoft play for this franchise?

Coyne: I do think now there are a lot of families who have the console for a family entertainment unit. A new console might not go into the kids’ bedroom, but it may end up in the family room, so games that can be played as a family are an important part of the family space. I grew up playing games, and I’m happy to sit with my son and daughter and play a game that we can all enjoy in the family room. With the Skylanders franchise, we see boys and girls, mothers and fathers, wanting to play it together and have fun. Having fun as a family unit on a game console is great.