Toy Versus Toy

Aside from killing you with cholesterol, suspect hygienic procedures and feeding you substances of dubious content, American burger chains have never had much to answer for. Well, you know, except for five out of six urban legends, that really fat guy next door and ketchup whenever you specifically say you want your burger plain. In 1999, Burger King launched it's Kid's Meal movie tie-in, and they were swamped. With a selection of toys almost as numerous as characters, they had kids swinging from the rafters. There were punch-out cards, spinning tops, small stuffed toys and (I am not kidding) gold-plated collectible cards in life-size Poke-balls. Now, with a promotion like that, how could they have gone wrong?

Sarah Smith is a freelance writer who lives in Toronto. This article appeared in Maclean's Marketing in January of 2000.

This is a tale of two promotions and how, with an extremely strong premium, one burger giant managed to rise above one of the most mishap-plagued toy giveaways in recent memory.

   In their never-ending battle to be the preferred choice among young customers, fast-food giants Burger King and McDonald's have been giving away toys associated with two popular films, Pokémon: The First Movie and Toy Story 2, respectively.

   While it won't disclose specific figures, McDonald's is savouring the results of a toy giveaway timed to the critical and box office success of Toy Story 2, released Nov. 26. The McDonald's toy giveaway, part of its 10-year co-promotion agreement with Disney, included one of 20 different characters from the film tucked into McDonald's Happy Meals. Patrons also had the opportunity to buy candy dispensers, movie posters and visors.

   Burger King's promotional tie-in with the release of the Pokémon movie Nov. 10, on the other hand, seems to have been troubled from the start by one mishap after another.    On Nov. 8, Burger King kicked off an eight-week kids' meal giveaway, in partnership with Nintendo of America Inc., that included one of 57 toys packed in Poké balls with one of 151 trading cards. Customers could also buy collectible gold-plated trading cards, and weekly trading nights were organized to encourage customers to trade their Pokémon collectibles.

   The fact that Pokémon merchandise has been banned from some schools in the U.S., because trading or selling Pokémon cards has incited fights and stealing among students, didn't seem to harm the Burger King tie-in, hailed by the company as "the most significant program ever executed at our restaurants." Only five days after the North America-wide promotion debuted, Burger King boasted that it had "shattered every sales record ever set" at the company, even though some BK outlets in both Canada and the U.S. were troubled by severe shortages of Pokémon toys.

   Basking in the promotion's success, the restaurant chain ran full-page newspaper ads in major North American cities Nov. 19-an apology addressed to "Parents of Pokémon Lovers." To solve the problem of temporary shortages, Burger King issued additional Pokémon posters and Pokémon trading cards. The company expected to give out 2.5 million Pokémon premiums in Canada, but ended up with demand for 4.5 million, says George Michel, president of Burger King Restaurants of Canada in Toronto. The shortage, he says, was not harmful, just unexpected.

   "We anticipated we'd have a huge increase compared to the best promotion we ran, but we never expected this promotion would be so unbelievable," Michel explains. "You never can gauge what exactly (a promotion) is going to do. You go by the historical performance of other promotions...but this one blew any record or statistics that Burger King ever had.

   "When something is hot, it's hot... It creates more excitement, so I don't think it hurt us."    Industry analysts have a slightly different take on the toy shortage. They say that, in a highly competitive business like fast food, a chain can hardly be pleased that it has to disappoint customers.

   "Any marketing campaign that you put on that you can't conclude effectively is a problem," says Doug Fisher, food service and franchise consultant and president of FHG International in Toronto. "Drawing people in and disappointing children and parents who have to go home with crying children and then stop at a toy store to buy something to make up for it is a disaster."

   John Hulland, associate professor at the Richard Ivey School of Business at the University of Western Ontario in London, also sees the miscalculation of demand as a negative. "If what you want to do is get a lot of people in the store and create long-term customers, you've lost that chance," he says.

   In comparison, McDonald's Toy Story 2 tie-in appears to have gone off without a hitch. Supplies didn't run out ahead of schedule and McDonald's is reporting one of its most successful Happy Meal promotions ever.

   "Disappointing customers is something that you really don't want to do, because there's no guarantee they're going to come back tomorrow," says Rem Langon, vice-president of marketing at McDonald's Canada in Toronto. "So you have to spend a lot of time making sure what you're talking about delivering, you're actually going to deliver. We make sure we don't let our customers down."

   Just when Burger King's biggest problem appeared to be a shortage of toys, tragedy struck in mid-December when a 13-month-old girl in California died of suffocation while playing with one half of a Poké ball.

   On Dec. 27, Miami-based Burger King Corp. voluntarily recalled the Poké balls, offering to exchange them for a small order of fries. The company said it would continue to distribute Pokémon toys in balls with the Big Kids Meals, but that the balls would no longer be included with the toy in the regular Kids Club Meals, which are generally intended for younger children. Burger King reportedly said that 25 million of the balls were distributed in North America, and that the balls pose no hazard to children over three.

   Another factor that doesn't seem to have dampened enthusiasm for the Burger King-Pokémon promotion is the Pokémon movie's weaker showing at the box office, in comparison with Toy Story 2.

   Toy Story 2 enjoyed critical success and did very well at the box office: US$177 million (C$256.7 million) in its first six weeks. But the Pokémon movie suffered bad reviews and weaker revenues, despite a strong opening, totalling C$121.8 million in the first seven weeks.

   Analysts caution that fast-food restaurants always face a risk with tie-ins if the movie doesn't live up to its blockbuster billing. "Toy Story 2 is a pretty safe bet because it was proven the first time around," says Hulland. "Pokémon is somewhat riskier for Burger King, but as it turns out, was the better bet." A major reason is that Pokémon was among the hottest toys this Christmas.

   Despite the hazards, such tie-ins seem destined to continue, since the similarity in menus of the fast-food restaurants give them little differentiation.
   "It's the same hamburger and the same french fries and the same chicken fingers for the last 10 years," says FHG's Fisher. "The promotion is what keeps it changing and interesting, and kids buy into it very quickly."
   Naturally, McDonald's and Burger King deny that customers are coming in primarily for the toys. "We are in food service, and the programs we run...those are added-value things the customer comes in for. It's a little extra," says McDonald's Langon.

   Burger King's Michel makes a similar point. "We are not in the business of toys," he says. "The toys are really there as an add-on, as opposed to the reason to be there... You do it to reward your existing customers by providing them with added value."    So who's winning? In the end, there's little use trying to declare a winner in the war of the toy promotions. For as surely as there will be blockbuster movies and toy fads, there will be fast-food promotions to go along with them.