Hasbro 2008 Annual Report Download - page 12

LADDERS, CANDY LAND, TROUBLE, MOUSETRAP, OPERATION, HUNGRY HUNGRY HIPPOS,
CONNECT FOUR, TWISTER, YAHTZEE, CRANIUM, JENGA, SIMON, CLUE, SORRY!, RISK, BOGGLE,
TRIVIAL PURSUIT and GUESS WHO?, as well as a line of puzzles for children and adults, including the
BIG BEN and CROXLEY lines of puzzles. WIZARDS OF THE COAST offers trading card and role-playing
games, including MAGIC: THE GATHERING and DUNGEONS & DRAGONS. We seek to keep our core
brands relevant through sustained marketing programs as well as by offering consumers new ways to
experience these brands. In 2008, we acquired Cranium, Inc., which resulted in an extension of our core brand
portfolio of games. The Cranium brand includes a range of products targeted to kids, families and adults. In
addition, we hope to increase the reach of our brands through our strategic alliance with Electronic Arts Inc.
(“EA”) which expands our brands to a variety of new digital platforms.
Our boys’ toys include a wide range of core brands such as G.I. JOE and TRANSFORMERS action
figures and accessories as well as entertainment-based licensed products based on popular movie, television
and comic book characters, such as STAR WARS and MARVEL toys and accessories. In the action figure
area, a key part of our strategy focuses on the importance of reinforcing the storyline associated with these
products through the use of media-based entertainment. In 2008, sales in our boys’ toys category also
benefited from major motion picture releases of IRONMAN, THE INCREDIBLE HULK, and INDIANA
JONES AND THE KINGDOM OF THE CRYSTAL SKULL. In addition, STAR WARS, SPIDER-MAN and
TRANSFORMERS products were supported by animated television series. In 2009, the major motion pictures
G.I. JOE: THE RISE OF COBRA and TRANSFORMERS: REVENGE OF THE FALLEN are expected to be
released based on our G.I. JOE and TRANSFORMERS brands. In addition, the Company expects product
revenues from the 2009 release of the motion picture, X-MEN ORIGINS: WOLVERINE, based on the
MARVEL character. In addition to marketing and developing action figures for traditional play, the Company
also develops and markets products designed for collectors, which has been a key component of the success of
the STAR WARS brand.
In our girls’ toys category, we seek to provide a traditional and wholesome play experience. Girls’ toys
include LITTLEST PET SHOP, MY LITTLE PONY, FURREAL FRIENDS and BABY ALIVE brands. In
2009, we will seek to continue to grow and refresh the LITTLEST PET SHOP brand through the introduction
of new characters. In addition, in 2009, we plan to expand our presence in this category by introducing a full
line of STRAWBERRY SHORTCAKE toys.
Our preschool toys category encompasses a range of products for infants and preschoolers in the various
stages of development. Our preschool products include a portfolio of core brands marketed primarily under the
PLAYSKOOL trademark. The PLAYSKOOL line includes such well-known products as MR. POTATO HEAD,
WEEBLES, SIT ’N SPIN and GLOWORM, along with a successful line of infant toys including STEP
START WALK N’ RIDE, 2-IN-1 TUMMY TIME GYM and BUSY BALL POPPER. Through our AGES &
STAGES system, we seek to provide consumer friendly information that assists parents in understanding the
developmental milestones their children will encounter as well as the role each PLAYSKOOL product can play
in helping children to achieve these developmental milestones. In addition, our preschool category also
includes the TONKA line of trucks and interactive toys and the PLAY-DOH brand.
Over the last several years our tweens toys category generally marketed products under the TIGER and
NERF brands and sought to target those children who have outgrown traditional toys. The age group targeted
by this category was generally 8 to 12 years old. The major tweens toys product lines in 2008 were NERF and
I-DOG. In recent years, we have used our consumer insights and electronic innovation to develop a strong line
of products focusing on this target audience; however, as consumer electronics have become more affordable
to this age group, this category has become less relevant. As a result, we have seen a reduction in demand for
many tween electronic products as the target consumers have increasingly embraced adult consumer electron-
ics. We also have not achieved the profit margins on many of the tween electronic products which we
considered necessary. For that reason, starting in 2009 we will no longer have a tweens product category.
However, we do plan to continue to opportunistically offer electronic products which we believe can be
successful items. Going forward, those items will be offered under either our boys’ or girls’ categories. For
example, starting in 2009, I-DOG will be managed under the girls’ toys category. In addition, our NERF and
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