Monday, 3 July 2017

Star Wars At 40 (part 7) - The Toys

Mention Star Wars to people who were kids in 1978 and most will instantly think of the toys.  While the current films have the might of Disney behind them (who really know how to put out the merchandise), back in those heady days of the late 70s we had to wait a while, as the success of the film took everyone by surprise.  But the toys did come out and they were spectacular, helping young fans continue the adventures of their favourite heroes until they were able to see the film again.  So, for the seventh entry in the Star Wars At 40 thread, I’m taking a look at the toy line.
George Lucas’ original deal with 20th Century Fox for Star Wars gave him $50k each for writing, producing and directing.  When his second film, American Graffiti (1973), opened to huge success (it’s still one of the most profitable studio films ever, in terms of cost-to-revenue) his agent Jeff Berg re-negotiated.  However, instead of more money, Lucas wanted complete control of the sequel rights and merchandising (he’d fantasised, whilst writing the script, of having R2-D2 cookie jars, Wookiee mugs and wind-up robots) to ensure things were done right.  "I didn't want manufacturers slapping the Star Wars name on everything under the sun and cheapening it," he's reported as saying in Stephen J. Sansweet's Star Wars: From Concept To Screen Collectible.  Fox, who on past experience only saw merchandising as a promotional tool, agreed and after their 15% admin fee was deducted, all revenue would be split 50/50.

Response from licencees was lukewarm at best with several, including Mego Corporation (one of the most powerful toy companies in the 70s with their 8” figure line), passing but Bernie Loomis, president of Kenner, saw an opportunity.  “I liked the name Star Wars [and] I liked the robots,” he said.  Fox executives  sold the company rights to all Star Wars toys in perpetuity, a deal made over Lucas’ strenuous objections.  “We’ve lost tens of millions of dollars because of that stupid decision,” he fumed in 1983 to Dale Pollock, as recounted in Skywalking.  When his lawyer Tom Pollock negotiated Lucas’ deal for The Empire Strikes Back, part of the agreement was that he got all merchandising rights back, so Fox couldn’t sour any new deals.
George Lucas (left) and Bernard Loomis
Kenner Products was founded in 1947 by brothers Albert, Philip & Josepth Steiner and named for the Kenner Street address of their previous operation, the Cincinnati Soap Company.  They were inspired to make toys after watching a boy make bubbles by waving his hand after dipping it in soapy water and their first product was the Bubbl-Matic Gun.  A pioneer in TV advertising (they sponsored the children’s show Captain Kangaroo in 1958), the company was bought by General Mills in 1967 and in the 70s, they had one of the biggest selling toys in the world with their Six Million Dollar Man doll.  The Star Wars deal, costing Kenner $100k a year, wasn’t considered a major investment for the company - back then, with no video or streaming, toy companies preferred to licence television shows which provided constant weekly exposure since films came and went quickly.  No-one expected Star Wars to be different.

With the licence in hand, Kenner began designing the range and Loomis made a key decision which would change the industry forever.  Realising Star Wars would be vehicle dependent and it would be prohibitively expensive to scale the spaceships to a twelve inch doll (the size of Steve Austin’s figure and Action Man), Loomis apparently held his fingers apart and asked “how about that big?”  The measurement - three and three quarter inches - was agreed upon and allowed Kenner to create affordable ships and playsets for the figures.

The Early Bird Certificate Package (with the boxed four figures that
were sent later)
The success of Star Wars and its attendant high demand for merchandise exceeded Kenner’s expectations by a long way.  Since the company signed its contract just a month before the 25th May release, they faced a big problem - the normal manufacturing cycle was between twelve and eighteen months, meaning the figures wouldn’t be ready for the all-important 1977 Christmas season (and missing it could mean losing out on millions of dollars), though they managed to get some jigsaw puzzles and a board game out for the Autumn.  Loomis’ decision, derided at the time, was to sell what he called an 'Early Bird Certificate Package'.  Essentially an IOU, it was a certificate to be redeemed at a later date for four figures - Luke Skywalker, Princess Leia, Chewbacca and R2-D2 - a display stand, some stickers and a Star Wars fan club membership card.  600,000 empty cardboard boxes were sent out and even though the media criticised the move and a lot of packages went unsold, it did what Loomis had predicted and kept public interest in the toys.
Top - the Jawa sandcrawler playset
bottom left - the droid factory - bottom right - Luke's Landspeeder
Kenner released the first twelve figures in its Star Wars line in 1978 and set the price-point at $1.97 to encourage sales.  Vehicles were released (Luke’s landspeeder and X-Wing, an Imperial Troop Transporter and Darth Vader’s TIE fighter) along with several playsets (the Droid Factory, a Dewback, the Jawas Sandcrawler and the Cantina) as well as more figures (including four from the Cantina) over the year.
top - the Dewback (figures not included in pack, no doubt)
bottom - the Cantina playset
“It was never particularly 'difficult' to work with Lucasfilm,” Loomis told D. Martin Myatt in interview, “but you have to understand the separate roles that each of us played. We never 'designed' anything for the Star Wars films.”  (I'm assuming he forgot about the Troop Transporter, which didn't appear in any of the films.)  "None of the characters, hardware, or weapons were created by anyone but George and his people. Our job was to execute the items, and add the most we could in children's play value to each product - package them, merchandise them and advertise them.  The royalty rate was 5% and would go to 6% if Star Wars became a TV series.  The following year we volunteered the increase to 6% [and] Mark [Pevers, then executive in charge of licencing for Fox] added one condition: ‘George says, ‘if you do Star Wars, you can't go Close Encounters.’”  Intrigued, Loomis met with Steven Spielberg but decided the story of Close Encounters Of The Third Kind wasn’t ‘toyetic’ (a property being expressible in playable figures and hardware) enough.  Even so, “when the toys went into production, George had us send one of each new toy directly to Steven,” Loomis said.
The Star Wars action figures were plastic, almost all of them 3.75” high (with some exceptions, such as Chewbacca who stands 4.25”).  They typically had five points of articulation (legs, arms, neck) - Chewie and the Stormtroopers didn’t have the latter - and the majority were sold in plastic bubbles on cardboard backing (and if you have a pristine one of these today, they’re worth a lot of money!).  Most characters had variations, ranging from slight differences in paint detail (early Luke has either blond or light-brown hair) to sculpt changes (the original Han had a smaller head - the version I own - which was replaced by a bigger one that looked even less like Harrison Ford).  The original lightsabers wielded by Luke, Ben Kenobi and Darth Vader featured a double-telescoping mechanism which was replaced by a single-telescoping one and the early Jawas had a vinyl cape, similar to Ben’s, that was later changed to a fabric cloak.

Star Wars figures were produced across the world by other companies, many of whom were subsidiaries of General Mills - PBP/Poch in Spain, Meccano in France, Toltoys in Australia, Lili Ledy in Mexico, Glasslite in Brazil, Clipper in Belgium & Luxembourg, Parker in Germany, Harbett in Italty and Brio/Playmix in Scandinavia.  The licence in the UK was held by Palitoy, a name I knew well from Action Man.
ad in Star Wars weekly issue 5, March 1978
The Cascelloid Company was formed in 1919 by Alfred Edward Pallett to produce ‘celluloid and fancy goods’ at Coalville in Leicestershire.  Bought in 1931 by British Xylonite, the name Palitoy was created as the trademark for the companies toy division.  When British Xylonite developed injection moulding in 1941, this efficient method of production allowed Palitoy to produce items more cheaply and, in its heyday, manufactured some of the UK’s most popular toys (original items or licenced products) such as Action Man, Tiny Tears, Pippa, Tressy and Mainline Model Railways.  Palitoy was sold to General Mills in 1968.

The Star Wars licence allowed Palitoy to extend the Coalville factory in 1977 and by 1978 they were employing a thousand people, seeing sales that year top £20m.  Although most of the figures were identical worldwide, some products were re-designed specifically for the UK market including a cardboard, self-assembly version of the Death Star.  Bob Brechin, the former chief designer at Palitoy (he also created Action Man’s gripping hands!) was told the plastic playset from Kenner was too expensive for the UK market so he designed a card one, which is now hugely collectable.  “I am really chuffed that the collectors, even in the States, are so keen on our design,” he told the BBC.  As well as producing a large amount of figures for the British market, Palitoy also exported stock overseas and General Mills considered them essential in making European distribution work.
A kids toy, made of card - no wonder surviving examples are highly sought-after (and expensive!)
The merchandising side of Lucasfilm was handled by one of its subsidiary companies, Black Falcon Ltd, which was set up in February 1978 and had thirty employees by the end of that year.  “Star Wars licencing and merchandising was going to have to provide the financial base to sustain the company until Empire was released,” Richard Tong, Lucas’ accountant at the time, tells J. W. Rinzler in the excellent Making Of The Empire Strikes Back.  The company managed licences for books, cassettes, bedding, curtains, t-shirts, promotional photographs, a newspaper strip (closely supervised by Lucas himself, who was a comics buff), trading cards (which I wrote about here), sugar-free bubble gum (demanded by Lucas, who is diabetic) and, of course, the toys - which contributed over 70% of the royalty income.
Black Falcon logo developed by Suzy Rice (who also designed the Star Wars logo) and Kathie Broyles
As Tong pointed out, Lucas used the merchandising income to fund development (and part of the production budget) for The Empire Strikes Back.  During the summer of 1978, Black Falcon loaned more than $400k to the Lucasfilm production arm, the Chapter II Company, along with a further $200k to ILM.  Yet more funds were channelled into plans for Skywalker Ranch.  During production, the film ran over budget forcing Lucas to give some rights back to 20th Century Fox in return for funding and in July 1979 Black Falcon loaned Chapter II a further $525k.  With production over (and the second wave of toys due from Kenner), Black Falcon was completely merged into Lucasfilm on 1st December 1979.
The 12-back series
The figures were released on 2 cardbacks, the first (dated 1977) being the ’12-back’ followed by the ’20-back’ through 1978 and 1979.  The 12-back series consisted of Luke Skywalker, Princess Leia, R2-D2, Chewbacca, C-3PO, Darth Vader, Stormtrooper, Ben Kenobi, Han Solo, Jawa, Sandpeople (Tusken Raider) and Death Squad Commander.  The 20-back series expanded the range with Greedo, Hammerhead, Snaggletooth and Walrus Man (all from the Cantina), Luke (X-Wing pilot), R5-D4, Death Star Droid and Power Droid.
the 12 back card (left) and 20 back (right)
The 20-back set also capitalised on the anticipation surrounding The Empire Strikes Back with a mail-away campaign, wherein kids sent four proofs of purchase from any Star Wars figure and got a sneak peak at a new character.  This turned out to be Boba Fett, who made his first appearance in the (now-legendary) Star Wars Holiday Special.  The original figure came complete with a rocket-firing jetpack but health & safety fears caused Kenner to glue the rocket in securely when it reached production.  Despite maintaining no rocket-firing Fett’s made it out to the public, several figures have appeared and it’s now one of the most valuable - and sought-after - Star Wars toys ever made, selling for upwards of $2,000 on the collectors market.

By the end of 1978, Kenner had sold more than 40 million figures for gross sales in excess of $100m.  Sales in 1979 again topped $100m and the original toys (which ran from 1977 to 1979) were succeeded in 1980 by Kenner’s The Empire Strikes Back line.  In total, there were 20 figures in the original line, 30 were added for Empire (1980-1982), 31 for Return Of The Jedi (1983-1984) and 15 appeared as part of the Power Of The Force line (1985).
The full line-up
When the line ended in 1985, Kenner had sold approximately 250m action figures.  The company was bought by Tonka in 1987 and Hasbro in 1991 and continues to produce Star Wars merchandise.  Hasbro closed Palitoy in 1994 and the 10-acre factory site was sold in July 1996 with outline planning permission for housing.

Bernard Loomis was inducted into the Toy Industry Hall Of Fame in 1992.  The Star Wars action figures were added to the National Toy Hall Of Fame in 2012.

Part of my Stormtrooper army
On a personal note, I only kept two of my original figures - Han Solo and the Death Squad Commander.  As I discussed in this blog post from February 2011, Nostalgia and Stormtroopers, I decided to start collecting Stormtroopers when I found some figures in my friend Joe's Leicester Vintage & Old Toy Shop.  Since then, in addition to a variety of other figures (including Luke, the droids, Chewie, Leia, Hoth Troopers, Scout Troopers and Darth Vader) and vehicles (I finally got a Millennium Falcon and X-Wing!), I have amassed an army of 90 vintage Stormtroopers.  They stand on top of one of my bookshelves in the study and I'm very, very pleased with them.
My original figures, from 1978
Han and Chewie
My three 'best' Stormtroopers
"These aren't the droids you're looking for..."
"Hang on, you're not Ben Kenobi - and hey, we're standing on the wrong side!"

Skywalking, by Dale Pollock
Deadline interview with Tom Pollock
BBC interview with Bob Brechin - Star Wars and Action Man: The rise and fall of Palitoy
The groundbreaking history of Star Wars Toys (io9)
The Hollywood Reporter
Interview with Bernard Loomis by D. Martin Myatt
The Making Of The Empire Strikes Back, by J. W. Rinzler
Star Wars: From Concept To Screen Collectible, by Stephen J. Sansweet

2017 marks the 40th anniversary of Star Wars, which was released in the US on 25th May though it didn't hit the UK until 29th January 1978 (following a 27th December release in London).  I was lucky enough to see it in early 1978 and it remains my favourite film to this day.

To mark the anniversary, I'll be running a year-long blog thread about the film with new entries posted on the first Monday of each month.

May The Force Be With You!

Find all the entries in the thread here

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