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Care Bears Clawing Back

Are you nostalgic about the Care Bears – those plush teddies with glowing bellies and magic smiles that can reverse any child’s grumpy mood? That sort of depends on how old you were in the mid-1980s when they took over television screens with a show that aired for nine seasons and a big screen trilogy, starting with “The Care Bears Movie” in 1985. Actually, the teddy bears have never really gone away, with more than 50 characters rotated on the shelves at mass retailers such as Walmart, Target and Toys “R” Us. But the dolls have long been past their prime in an age when even young children spend much of their time with digital toys and tablets. Now, American Greetings Corp. is betting it can turn around the long sales slide. The Cleveland company’s Sherman Oaks unit that handles the dolls is coming out with digitally enhanced plush toys, mobile apps and an original show on Netflix Inc. that will air in more than 120 countries. “Care Bears is one of those brands that is multi-generational. In general, classic brands work really well in the marketplace for consumers (and) we’ve had a lot of demand coming toward us, such as Netflix,” said Sean Gorman, AG Properties president. “We want to create a world where Care Bears are everywhere kids want to access them.” American Greetings is pursuing the strategy after its owners, the Weiss family in Cleveland, took the company private in 2013 for $878 million following a decline in the company’s core greeting card business. It has a larger strategy to improve its electronic offerings. For example, its website allows consumers to buy and send digital greeting cards. American Greetings is far from the only company that owns legacy toy brands that have faded, and are routinely revived in the new digital age. My Little Pony, owned by Hasbro Inc., the nation’s second largest toymaker in Pawtucket, R.I., and Dora the Explorer, are but two of AG Properties’ competitors that have expanded into online games and mobile apps. Toy consultant Richard Gottlieb of Global Toy Experts in New York said the toy industry is rapidly changing and toys are becoming more digitally enhanced and interactive, making it difficult for older brands to keep up. “It’s very challenging to bring back an older brand unless you really do your homework. It’s a very different group of kids right now. It’s not just that they’re digitally savvy – it’s that they’re digitally intuitive,” said Gottlieb. “You’ve got a generation of children who do not see a separation of what’s virtual and what’s real. There has to be a digital element, and it can’t be an add-on. It has to be intrinsic.” Paper start American Greetings has had a side business in toys since Care Bears was introduced more than 30 years ago as part of a kids division, along with Holly Hobbie, Madballs and Strawberry Shortcake. The idea was not only to sell toys, but to provide content for the company’s greeting cards. Madballs, freaky-looking rubber balls with bulging eyes and exposed brains, and Holly Hobbie, a classic country rag doll, are still owned by American Greetings. But the company sold its Strawberry Shortcake brand last month to Iconix Brand Group Inc. in New York for $105 million. That brand features pinked-haired dolls with strawberry-decorated hats and clothes, and includes television shows, online games. apps and other consumer products. “(Iconix) had approached American Greetings repeatedly over a period of time that lasted well over a year, and had been very interested in buying Strawberry Shortcake,” said Gorman. “Basically they made an offer that the owners of the company couldn’t refuse.” But American Greetings decided to hold onto Care Bears, which is run out of 2,200-square-foot offices on Ventura Boulevard by Gorman and four employees. The company would not disclose the brand’s past sales but said the goal this year is to hit $120 million. “What we like about Care Bears is that it’s a branded teddy bear and there is no competition for that right now on the marketplace,” Gorman said. “We think there’s something unique and old about Care Bears that is competition proof.” Key to the revival is the worldwide release of the Netflix original series, “Care Bears and Cousins.” The show will introduce the teddies to all of Europe and areas within Latin America, China and Russia. The 30-minute episodes will include core characters that kids have come to recognize, and will follow the lives of Care Bears and their cousins as they solve problems and promote kid-friendly messages. Netflix co-produced the show and purchased its content for the next two years during which the show can only be aired on Netflix.com. The Los Gatos, Calif. company declined to discuss the financial details of the deal. New apps Though the Netflix series is key, the fundamentals of the toy brand have not been overlooked. A new plush doll line will reach stores in the fall through a licensing deal with Deerfield Beach, Fla. toy manufacturer Just Play. The dolls are as small as an 8-inch beanie bear to a 20-inch jumbo bear, with prices ranging from $9 to $25. Just Play also created the new Care Bears Sing Along quartet –four interactive bears that talk, sing and dance with one another. They are sold separately for $30. When the bears are in close proximity, they’re programmed to recognize which bears are near them and to call each other by name. They also sing common preschool songs such as “If You’re Happy And You Know It Clap Your Hands” and “The Wheels on the Bus.” “We picked songs children will be familiar with (and) I think consumers are going to get it right away,” said James Chang, Just Play director of brand management. “Because of the music and because of the fact that they talk and move, I think people will be excited to see that.” The company also has developed new Care Bears apps for tablets and cell phones. “What we really want to do is expand our opportunity for storytelling by making sure we are telling the kids a story on multiple platforms,” said Angelina Castro, AG Properties marketing director. “That includes social media, our apps and retail experiences. We want to make sure we are wherever our consumers are and providing Care Bears experiences in those platforms.” Among the “freemium” apps – which are free to download but include additional features that must be purchased – are Sleepytime Rise and Shine, an app that prepares kids for bed; digital reading and comic books; an “appisode” that features snippets of past Care Bears shows; and a matching Care Bears game similar to Candy Crush. Gorman said the company was recently approached with an offer to buy the brand, but American Greetings considers it too fundamental to its business strategy to sell. “It’s contemporary, classic and has a much deeper library than Shortcake ever had in terms of content,” he said. “This is a brand we will not part with.”

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