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As we head into the 2024 holiday season, retail sales are about to make or break the targets of toy companies worldwide. ForJazwares, named one of the 2024 TIME100 Most Influential Companies, they’re feeling bullish about future prospects according toDaren Brandman, Managing Director of Jazwares Canada. Where the toy industry as a whole saw declines in 2023 and in the first half of 2024, Jazwares is on a consistent growth trajectory that spans over a decade, thanks in no small part due to the success of the top-sellingSquishmallowsproduct lines.
Everyone knows Squishmallows, but for me, it was theStar Wars Micro Galaxy Squadrontoys when first announced in May 2022 that got me looking more into Jazwares because it tied into something I grew up with. I used to collect Star Wars Action Fleet toys from Galoob which are similar in scale, and atStar Wars Celebration, I met Maxwell Lux, Senior Brand Manager, and Bret Ingraham, Senior Director, Public Relations & Communications from Jazwares who had a dedicated booth for the Micro Galaxy Squadron figures.
An Introduction to Jazwares
“Max [Lux] is an awesome person to talk product with,“Brandman tells me.“I had him visit Toronto and took him to see some customers. And just listening to him. With him, it’s how far into the weeds do you want to go on some of these properties? We were in Orlando for a company retreat, and we actually got to go to Disney World. And there was the Indiana Jones stunt thing there. We had a private event for that, and then they did trivia. And he was the guy to answer the trivia for - like, they split the company into two teams - And there was some really obscure Indiana Jones question. I wish I remember what it was but he’s like, he knew it just like that,“laughs Daren.
ScreenRant’s Rob Keyes: It’s funny you say that because Max gave me a private tour of the Celebration booth. He was geeking out about every character and variant of all the Star Wars ships. I brought this here just to show you. It’s one of the Republic Gunships, but with a custom paint job. And Max was telling me the inspirations for every little character design and how they made this one happen. And for everything that was there. And I’m like, “wow, this guy knows his stuff!” He saved this for me which was such a kind gesture. So, I love the team is what I’m saying.
Daren Brandman: Great! That’s great.
Jazwares' Biggest Wins Came Through Acquisitions
For a little background yourself, can you tell me about your role, how you got involved with Jazwares and its operation in Canada?
Daren Brandman: I’ve been in the toy industry for 21 years, which is crazy to say, because I feel like it’s gone by so fast. I’ve been in the industry a long time, and actually, after working for a few different major manufacturers, I had my own sales agency based in Toronto, and I was representing Wicked Cool Toys. And then fast forward a few years, Jazwares acquired Wicked Cool Toys. I think it was 2018. That’s how Jazwares took on the Pokemon manufacturing rights as well as AEW, Cocomelon, and a few other things. And at the time the business was being managed by a distributor, a Canadian distributor, specifically for the Canadian business, which was a little bit rare to find that given how mature the business was in the US. So I met with the Zeberskys at the time, and they said, “you know, Daren we really like what you’ve been doing, managing the Wicked Cool business. Why don’t you start getting involved in the Jazwares business and continue to run Wicked Cool while we integrate them?”
And then, long story short, they said, “we’d really love to plant our flag in Canada, we should be having these direct relationships with retailers. And you know, we’d love for you to join the company and be a part of that.” So going back about three years from now, I’m employee number one for Canada. I helped find the office space here, and now our office is up to like 19-20 people. We’ve been growing like crazy. And one other thing, what’s really neat about the office - a lot of companies will open up an office here, and it’ll be primarily a satellite office, primarily only doing sales - But we have like eight different departments here. I have a VP of Product Development who actually shares my office wall. We have inventor relations, people who are part of a team in Florida. So there’s a lot of strong toy talent in Canada. Jazwares has taken advantage of that and is pulling it into the global entity.
Jazwares was founded by Judd and Laura Zebersky in 1997 and acquired by Berkshire Hathaway in 2022.
Jazwares initially acquired these licenses for Pokemon and such through acquiring Wicked Cool Toys in Canada?
Daren Brandman: Wicked Cool Toys had global rights for Pokemon, I think with the exception of the Asia market. When Jazwares acquired Wicked Cool, they acquired their IP and their licensing deals as well.
There are many IP in the Jazwares portfolio now. Are some of those from other acquisitions, or is it mainly just through direct license agreements with the IP owners?
Daren Brandman: You know with Squishmallows, it was an acquisition. Squishmallows was originally founded in 2017 by a company called Kellytoy. Kellytoy had been primarily an amusement plush company for about 25 years, and it was just pre-pandemic, and we made this acquisition, and Squishmallows was just kind of going like this at the time. So, the timing couldn’t have been more perfect. And then we just saw it completely take off over Covid. Jazwares knows the collector business really well. They really know marketing. It went completely viral on social media, but they were able to capture it, not just make it what we call in the coin industry, “one and done,” but it really just completely took off. It took on a life on its own. And Jazwares has been keeping the energy of the brand and keeping it going. It’s been a fantastic ride.
Kellytoy was founded in 1986 andits social media pageshave been inactive since being acquired by Jazwares in 2020, three years after it had created Squishmallows. The KellyToy website domain redirects to Jazwares.
The Importance of FAN EXPO and Comic-Con Booths
I do have more questions about Squishmallows but I want to bring it back a little local. Talk about FAN EXPO Canada. I know you guys had a sizable presence with a booth there. We were there as well with ScreenRant but in a different way. I also saw the San Diego Comic-Con Jazwares booth, and of course, Star Wars Celebration in London last year is where I saw the Micro Galaxy Squadron stuff. The setups are very impressive. Can you talk the presence and booths at conventions like these, and what benefits you see from these activations?
Daren Brandman: Yeah, absolutely! FAN EXPO for us is truly a fan event, which we absolutely love. We’re not there to sell anything. We’re there to show the “Summer of Squish.” And it’s very much an activation. Our first time participating in FAN EXPO was three years ago when we really were just starting to open up the office here. We had Cam the Cat have a presence as literally our mascot walking around, and he just held so much attention across the board.
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That’s a neat marketing campaign pillar. When it comes to, and we’re talking to Squishmallows primarily in this FAN EXPO example, but for all the Jazwares product lines, what are the most successful marketing campaigns? Is it these in-person brand activations, where there’s social and photo op potential, or is it your more traditional, online or video marketing and such?
Daren Brandman: It’s a tough question to answer because sometimes it’s hard to know the ROI you’re getting on there. We do look at impressions, of course. I think media buys and digital media campaigns are always going to be huge, especially with launching something new. Every brand is a little bit different in how we go about it. FAN EXPO, it’s so personal. And we have so many influencers coming through as well. And just the impact of, forget influencers, just people coming through, taking pictures, sending to their friends, really having a personal experience with the brand. It’s super meaningful. But then you also have, on the other side of the coin, what we do with pre-rolls on YouTube, or what we do with digital media buys, or what we do with PR and influencers. It all rolls up to some degree.
Daren Brandman: If anything, I challenge the company back at our head office to do more next year. Like you said, you’ve seen our presence at Comic-Con. It’s not just Squishmallows, it’s Pokemon, it’s Star Wars. And, you know, I want more space next year. I want to go bigger. We do exclusives for Comic-Con as well. I want to bring that experience here. So every year we get a little bit better. I don’t know what the plans are for next year, but this is where my head’s going.
There’s a big collectors market, obviously, at FAN EXPO Canada, so having more of the other IP in there would be signigicant as well. What are Jazwares' plans forNew York Comic Con?
Daren Brandman: I’m not sure. Off the top of my head, I think we do participate in most of the Comic Cons, so the major ones, but I’m not sure.
I’ll have to followup on that as we’re hosting a media suite for interviews across several ofValnet’s entertainment publications, and providing live coverage at NYCC. We talked a little bit about the history of Jazwares' acquisitions and such, and for a decade straight, Jazwares has been growing year over year. If you look at this from a branding perspective, it almost seems like growth at a rapid pace. What do you think is the key to that sustainability and that growth so far?
Daren Brandman: If you go back over Jazwares' history, Jazwares has been around for 25 plus years. I think last year was our 25th year anniversary, which is crazy, because there’s so many people who I’ll say, “hey, I work for Jazwares.” Or “have you heard of Jazwares?” They don’t necessarily know the company name, but they know the brands behind it. And Jazwares has always had a knack for going into areas that haven’t been discovered by others. If you go back 20 years, they were doing like Mega Man figures, they were doing Mortal Kombat figures before they became mainstream pop culture. Jazwares was the first company to really take a video game property in Minecraft at the time and bring it to the masses and demonstrate to the big box retailers of the world that, “hey, it’s not just movie content or show content toys that you may put on the shelf. There’s all this other content that people are craving as well.” So I think a lot of Jazwares' success has always been just getting into these nooks that other people weren’t looking at and that’s what we’re really continuing to do with some of the other things we got going. Just looking where everyone else isn’t.
Expect Modest Toy Industry Growth Going Forward
The toy industry as a whole in North America has seen some recent challenges and sales declines. 2023 in particular was rough on Hasbro as an example. They are now licensing out one of their IP in Power Rangers which is moving production and distribution over to Playmates starting next year. I know your focus is the Canadian market, but I am curious about what you’re forecasting for the toy industry for the next year or three, and what you’re forecasting for Jazwares, specifically.
Daren Brandman: I think the industry as a whole will continue to have modest growth somewhere in the range of 1-2%, 1-3%, something along those lines. If you look at the category breakdown within the toy industry, there are a lot of fluctuations. We see dolls down a lot, whereas plush is up significantly. Obviously, we’ve been driving a lot of that plush business, so we’ve certainly been the benefactor of that. And we’re seeing a lot of the industry move towards more plush, or the retailers making more space for that. In addition to that, action figures have been good as well. Where we say, “okay, the industry as a whole might be showing negative growth right now,” we never really know until we get through December because so much of those sales are done in the last six weeks of the year. But yeah, I would say modest growth. And for us, we’ve got a lot of great things in the works for 2025. I don’t know if I can go on record saying a percentage number for our growth, but I would say I’m very bullish on Jazwares, and our sales, and our success going into next year.
Hasbro’s consumer products and entertainment segments saw 19% and 31% revenue declines in 2023, respectively, according to their financial reports.
Jazwares is Launching New Original IP in 2025
Got it. I appreciate that answer. Let’s talk about the IP-base toy lines. Everyone knowsStar Wars, but Jazwares has some pretty killer IP on the gaming side, including Pokémon, Fortnite, andCall of Duty. And on the kids side Jazwares has Cocomelon which our company has a little connection to - Valnet is Canadian-based as well, and we sold the Little Angel YouTube Network to Cocomelon’s parent company. I am curious for Jazwares' growth plan. Is it going to lean even more into IP acquisitions like these, or do you see there being new originals in that mix as well?
Daren Brandman: I would say there’s always going to be a mix. We do have some of our own IP that we’re planning to launch for next year. We also have some new deals in place for manufacturing some well-known toy brands for next year. There’s a couple I can talk about. We are taking over the manufacturing rights for Five Nights at Freddy’s. Five Nights at Freddy’s is a super cool property. I just watched the first live-action movie myself a little while ago, and that movie completely blew box office numbers out of the water compared to what it cost to make. That was a relatively low budget film, and there’s going to be, as far as I know, a second movie coming out.
There is, yes.
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Daren Brandman: Right, with a much bigger budget attached to it. And when retailers hear we’re getting behind stuff like that… One thing retailers know, and not just retailers, but collectors know about the Jazwares business, is we crush it when it comes to figures. Our figures, and the details we do at the price points we do them at, are phenomenal. I think I could say this: I know there was one product that I think we showed the guy who created Five Nights at Freddy’s, because I think he’s involved with some of the likeness approvals. And he looked at it and was like, “I’ve been waiting for somebody to do this for years. This is great.!” So, you hear stuff like that, and you get really excited. That’s one I can talk about.
The other one I can talk about is Avatar Legends that will be launching. Paramount is doing some awesome things with Avatar: The Last Airbender. That Netflix series was out this year. I think there’s another two seasons of that series that are going to come out. Avatar, the original animation is still one of the most watched series on Netflix, and there are plans for a live-action movie as well. Kind of like what we do inPokémon, we take all this amazing content that is there and start building a line from the ground up that makes sense in that universe. There’s some really cool stuff going on there.
Airbender is a massive pillar for us. And like you said, the rewatchability is like no other. And there’s alsomore animated Airbender projects on the way too. So there’s lots coming for the franchise. Let me ask you about the plush business, because that is an interesting element to all of this. Squishmallows are so popular. Of course, a lot of the competition started building to compete and mimicking a lot of these ideas and product lines. With the plush vertical growth, not just accelerated by Jazwares, but by competitors trying to jump in, how has that affected the Jazwares or Squishmallows business? There’s more fighting for shelf space. Certainly, at amusement parks, we’re seeing more competition as well…
Daren Brandman: Yeah, Squishmallows have really developed to be more than just a plush brand. It’s really evolved into this lifestyle brand. And you see that when Squishmallows makes its way into the Happy Meal, or Squishmallows makes its way into an H&M collab, or a PUMA shoe collab. We’re really on the cutting edge of this business at the moment. When we talk about the competition, if I showed you what the numbers are, for what somebody might define as our competition, we’re just in another universe.
I laugh as Daren continues,“No, I will say, modesty aside…,“before I followup with a quick “I understand.”
“Squishmallows has really developed to be more than just just a plush brand. It’s really evolved into this lifestyle brand”
“You put something with the Squishmallows badge, our product with the Squishmallows badge, next to somebody who is trying to ride the coattails of Squishmallows and they’re just not getting the sales,“Brandman explains.“They’re not. People want a true and authentic Squishmallow. And on the other side of it, we have a great legal team. If we feel somebody, a company, is encroaching on our IP we’re also not afraid to enforce that. You see a lot of that at certain retailers and certain marketplaces. You have got to watch out for when some people unfortunately try to trick the consumer. We’re always just trying to make sure we have our consumers' backs and always protecting our IP.”
Rare Squishmallows May Get Re-Releases
I see a Pikachu behind you. It makes me think of the Wave 1 Pokemon Squishmallows when they first came out, and I have the Pikachu one. I got that very first one for my daughter, and I was told, maybe Bret Ingraham told me, that I shouldn’t have opened it because it’s super rare. Everybody wants that one. And it got me thinking of all the other Jazwares collector’s items. Some of the Micro Galaxy Squadron figures are highly coveted and hard to get as well. I’m curious, when it comes to these items that became highly coveted collector’s items, are there any plans to re-release stuff like that in the future, or will most of these maintain their rarity forever?
Daren Brandman smiles at this as we both then laugh and I say"noted.”
“I know this is an audio interview but you know, you saw my face,“says Daren as I retort with"I’m just asking for the fans!”
Daren Brandman: Yeah, there might be stuff that might have planned re-releases at some points. I can’t speak to what they may be. We’re always looking to drive down the collectibility with the fans and give the fans what they want. And there’s a lot of cool new ones out now as well. We announced our collaboration with Stranger Things. We have Stranger Things Squishmallows. Those are super, super cool. We’re also doing one for the Beetlejuice movie. There are certain characters that just look awesome, like Beetlejuice looks fantastic. And right behind me, this actually, isn’t…
I could tell from the ears. It’s not the actual Wave 1 Pikachu.
Daren Brandman: This is actually our 24-inch Pikachu. He’s awesome though. He’s awesome. What we call our Wave 1 Pokemon Squishmallows collab, which was Pikachu and Gengar. They they did fantastic. And we slowly introduced about two new characters at a time when we do those Pokemon releases.
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I commend the restraint on that. When you say two, I feel like there’s interest in a thousand of those things. I’ve taken a lot of your time. I appreciate your time. Let me ask one more question to round this out. This is more of a personal question for you. Just for fun, what are your own favorite Jazwares products or lines, and what are you most looking forward to from what’s coming up next?
Daren Brandman: I have three kids at home. My oldest is about five and a half, so my favorite thing is anything I bring home that he gets really excited about. [LAUGHS]. Yeah, you get to reimagine yourself as a kid watching your own kids play with stuff. I brought home some of the Star Wars ships recently, the Millennium Falcon, and watching him roam around the house with its lights and sound on… That’s awesome. He loves Squishmallows as well. I’ll sometimes catch him in bed with it. But my personal favorite is on my desk. My personal favorite Squishmallow is Hei-Hei from Moana. I love this one. When I’m just working and that’s, you know, not having a great day. You’re just looking at him and like, yeah, that’s the face. That’s the face.
This isn’t a new re-release of Hei-Hei?
Daren Brandman: No, internally I think we called this our breakout assortment, which was all those breakout characters from different Disney movies. So it was Hei-Hei. It was like Lumiere from Beauty and the Beast. I think whether we had a Flounder from The Little Mermaid. This is what I like. I’ve been in this industry for so long so it’s little things. Like we have a Spidey and His Amazing Friends pull back car that you pull back, just on the floor, but then when it takes off it has a little mechanism that flips it 360. I’ve been doing this so long that when I see something that is a $14.99 retail vehicle, and I could just sit there doing this or I could watch a kid do that all day. Just like something that’s repeatable, that’s fun, that “oh, when is it going to jump?” I see a lot of value in those types of toys.
