The success of The Super Mario Bros. Movie is spurring the industry to get in the game with video game adaptations. This week, we’re publishing stories from our October/November magazine issue that dive into the lucrative-if-done-right art of turning video games into films and series. In today’s feature, toycos unbox the growing potential of vidgame adaptations at retail.  

Video games have slowly but surely made their way into the mainstream. And along the way, the medium has built up a multi-generational audience of players who are hungry to buy all manner of licensed goods related to their favorite titles.

According to a report published in August by New York-based Licensing International, video games, apps and software generated more than US$31.5 billion last year from licensed merchandise and services. The segment now accounts for 10% of the total licensing market, competing directly with fashion accessories (10%), toys (12%) and apparel (14%).

“The video game segment is no longer a narrow silo; retailers are starting to evaluate it as an equal part of the whole entertainment industry,” says PhatMojo president Bill Graham. “What we’re doing on the retail front is showing the scalability of these gaming brands as franchises.”

In the last three years, the LA-based company has signed a series of master toy deals with independent game developers including MiniToon (Piggy), BIG Games (Pet Simulator X), Roy & Charcle (Rainbow Friends) and EnchantedMob (Poppy Playtime). Graham notes that most of the titles it picks up for licensing deals are horror-themed, and they generate billions of plays from kids on gaming platforms like Roblox and Steam.

Graham identifies horror games as particularly strong fodder for storytelling. “In the toy world, that translates to many endearing and disarmingly cute character sets that players feel attached to.”

PhatMojo leverages these characters into a wide range of playthings, including action figures, playsets, surprise eggs and plush. Traditional toy categories like these ones work best for gaming IPs because they satisfy the basic need that players have to hold and touch a physical piece of the games they enjoy, says Graham.

And unlike other brands that are struggling to make headway at retailers, gaming products are some of the hottest SKUs in the toy aisle right now, he adds. This is thanks to the substantial player bases on record for each game, which gives retailers confidence that product won’t be left sitting on shelves.

PhatMojo rolled out its new range of Rainbow Friends collectibles and plush to retailers worldwide last spring.

This sentiment is shared by Toikido in London, which was already setting up licensing deals in all product categories for its Piñata Smashlings IP before the Roblox game had even launched. The property is inspired by the popular paper-maché party game and revolves around players hatching, collecting and battling with hundreds of piñata-styled characters.

“We began generating interest for [Piñata Smashlings] by showing retailers and our brand partners very early data from the user testing of the game,” says Toikido founder and CEO Darran Garnham. “We wanted to be as open as possible with them to build up their confidence in the brand.”

The game’s initial consumer products partners include PMI Kids’ World (collectibles and plush), Topps (trading cards), Redan Publishing (magazines), Centric Brands (sleepwear and beauty), Isaac Morris (apparel and swimwear), Inkology (stationery) and Jay Franco & Sons (bedding and housewares). Products will begin rolling out to retailers worldwide in September, with more drops planned into next year.

Just one month after launching in July, the Piñata Smashlings Roblox adventure game had generated more than a million plays, with kids spending an average of 17 minutes online during each session. And to supplement the gameplay, each physical product will come packaged with a download code that unlocks exclusive items for the purchaser’s Roblox avatar.

Meanwhile, Toikido’s game developer partner Supersocial will continue to add new features, characters and worlds into future updates of Piñata Smashlings, to give fans more reasons to play again and again.

“Respecting and listening to the game’s community has to be one of the core elements of the experience,” explains Garnham. “We’ve made sure to build a community team that’s ready to listen, learn and react to whatever the players need. It’s one of the big things we learned while working on previous game licenses like Among Us and Gang Beasts.”

Outside of the ongoing Roblox frenzy is Microsoft, which acquired Swedish game developer Mojang Studios and its flagship building and survival game Minecraft in 2014 for US$2.5 billion. Since Minecraft launched in 2011, gamers have purchased more than 238 million copies worldwide across 20 gaming platforms. The install base is up to 141 million monthly active users, and Microsoft is slowly making moves to convert them all into recurring buyers of consumer products.

“For years, we’ve been focused on building [Minecraft’s] core lines, including toys, apparel and publishing. But now we’re expanding to new categories and experimenting with different types of partnerships,” says Federico San Martin, Microsoft’s director of Minecraft consumer products.

The developer is hard at work on Minecraft’s 15th anniversary licensing program for next year, which will see the franchise expand into categories like food & beverage, consumer electronics and health & beauty for the first time. (To date, Microsoft has signed deals with more than 150 licensing partners worldwide for the gaming phenom.)

In the meantime, the company is focused on growing the game’s retail presence in international territories including Australia, New Zealand and Europe. San Martin also has his sights set on Asia as the next frontier for Minecraft consumer products.

“Whenever we expand to a new territory or market, it’s very important that we deliver products that relate or are authentic to that country,” he says. “That means not just distributing products from our global partners, but also searching out new licensing opportunities at the local level as well.”

Ivo Gerscovich, SEGA of America’s chief business and brand officer for Sonic the Hedgehog, adds that part of the essential formula for adapting games into consumer products is funding play patterns and product categories that align with the brand’s DNA. In the case of SEGA, that means locking in footwear deals with manufacturers like PUMA and Crocs to recreate Sonic’s iconic shoes in several different styles.

“With a franchise like Sonic, which has been around for over 30 years, one of our challenges has been ensuring that we’re keeping things fresh and fun while remaining authentic to the brand’s core values,” says Gerscovich. To overcome this, SEGA is balancing its product mix to include items that evoke nostalgia in the brand’s multi-generational audience and allow fans to incorporate the blue hedgehog into their everyday lives.

Uncanny Brands designed its Sonic mini-waffle maker as an exclusive prize at Dave & Buster’s arcades, then created a new edition for mass-market consumers hungry for a speedy breakfast.

One such example is the Sonic-branded waffle maker from Pennsylvania-based Uncanny Brands. Originally offered in April as an exclusive prize at Dave & Buster’s arcades in exchange for thousands of tickets, the item quickly built up demand among the franchise’s fandom, says Gerscovich. Seeing a new market for Sonic home appliances, SEGA quickly designed a new version of the waffle maker with Uncanny Brands that hit retail in June.

Gerscovich predicts that similar pop culture-themed partnerships will begin to trend with kids and families as more beloved gaming franchises are adapted for mainstream entertainment and licensed into products that make their way into retail aisles and online stores.

This story originally appeared in Kidscreen‘s October/November 2023 magazine issue. 

Check out our MIPCOM issue stories from earlier this week on the changing state of the video game adaptation market and how kidcos are building game-to-screen pipelines.