WEBVTT

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Quick, what's
your favorite toy or game?

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Whatever the answer,
the odds are good,

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it's from Hasbro.

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Green light.

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Red light.

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Well, not this game.

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Since its founding in 1923,

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Hasbro has grown from a textile
and school supply business

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into the biggest toy
company in the world.

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- G.I. Joe catapulted
Hasbro into the stratosphere

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as a toy maker.

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But their road to
glory is full of surprises.

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Like did you know
that one of Hasbro's

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most successful
toys from the 1980s

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wouldn't exist without tin
cans from World War II?

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- It's really weird.

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Or that the
secret to Hasbro's success

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was an up-and-coming
comic book company.

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- This was off the
charts, a phenomenon.

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And you'll
never guess how

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an entire segment of the
toy industry was invented

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because of one person's
aversion to dolls.

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- It's not a doll,
it's not a doll.

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Okay,

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You may think you know

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all about the
toys that built America,

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but when it comes to
this American hero,

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there is more than
meets the eye.

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I'm Adam Richmond gear up for

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the transformative
history of Hasbro.

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In the late 1970s,
Hasbro is struggling,

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and even G.I. Joe
can't save them.

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While their signature
toy soldier help

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put them on the map in 1964,

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since then his popularity
has taken a direct hit.

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The backlash to the Vietnam War

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triggered sales
to crash and burn.

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Until finally in 1978,

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Hasbro is forced to sideline Joe

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taking him completely
off the market.

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Then, in 1983,

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and in a desperate bid
to change their fortunes,

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they bring back the
MIA soldier after

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sitting him out the
last five years.

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Not only that, but in the era
of big hair and big muscles,

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the one foot high
Joe gets cut down

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to 1/3 his original size.

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So, why did Hasbro
relaunch the tough guy toy

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that no one wanted,

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and think the best way to
turn the company around

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was to make him tiny?

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To understand that
we need to go back

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to the beginning before
Hasbro even made toys.

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And we're best known for making

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pencils?

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Founded in Providence,
Rhode Island in 1923,

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Hassenfeld Brothers, as
it was known back then,

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quickly transitions from
manufacturing textiles

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to school supplies.

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- Hassenfeld Brothers was
founded by three brothers,

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and they were Polish
immigrants that came to the US

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and formed a stationery company.

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They made pencils, pencil boxes.

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During World War II,

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they expand their
product line to make

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doctor and nurse
kits for children.

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It's a temporary move,

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but one person inside
the company thinks

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toys could be more
profitable than pencils.

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He also happens to be one
of the founder's sons.

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- Merrill, young
guy out of college,

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comes there and says, "Hey,
I see a bigger opportunity

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for us to invest in new
machinery, new technology.

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Let's get into
the toy business."

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Merrill names
the new toy division

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by combining the
first three letters

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of Hassenfeld and brothers

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Hasbro.

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Now, they just need a hit toy.

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That's when Merrill
gets a well-timed visit

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from a struggling toy
inventor with a funny face

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on the toy.

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- George Lerner was an
artist from Long Island,

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and he came up with
the idea of taking

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different shapes and piercing
vegetables with them,

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and making a funny face kit.

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- It's like a little
potato face man.

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- I call it Make a Face.

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Within months,

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the new toy is in production,

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along with a new name,

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plus a revolutionary
advertising idea,

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marketing directly to children

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for the first time on an
untested medium, television.

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- What's new Hasbro?

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- Mr. and Mrs. Potato Head,

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that's what's new.

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- It was an absolute
game changer.

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It made a seismic
shift in the fact

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that toy companies could now
reach their target market,

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which was kids.

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And they want
what Hasbro's selling.

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More than a million
Mr. Potato Head kits

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sell in the first year,

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grossing $4 million for Hasbro,

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$39 million today.

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- Mr. Potato Head was unlike
anything else on the market.

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This is an entirely
new thing to turn

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your food into
something funny and fun.

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However,
some parents complain

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about finding rotten vegetables,

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scattered around their homes.

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As Potato Head sales decline,

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Hasbro finds
inspiration for their

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next big idea on the big screen.

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When the major motion picture

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the "Son of Flubber"
is announced,

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Merrill secures the
rights to make a toy

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based on the fictional
substance from the movie.

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- Flubber was a new
space age material

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that stretches, it pulls, roll
it into a ball and bounce it.

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But the real
Flubber is a real disaster.

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- There were reports
of kids getting rashes

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and having sore throats.

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- They had no choice,
but to get rid of it.

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Hasbro loses nearly
$5 million on the Flubber flop.

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They need another hit fast.

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When Merrill learns
about archrival

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Mattel's new doll for girls,

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he begins to have an idea.

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What if Hasbro made
a doll for a boy?

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In 1963, after losing nearly
$5 million on the Flubber flop,

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Hasbro needs to find
a way to bounce back.

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- It's a big process.

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Especialloy if it's a
big toy company

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and you need to steer the ship
in a different direction.

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- This is the world's
first movable fighting man.

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Everything from guns
to boots to dog tags

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will be perfect scale
replicas of the real thing.

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Merrill
likes the concept,

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but one detail has him worried.

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- The hurdle was getting over
the fact that quote unquote,

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"A boy will never
play with a doll."

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That's when
Merrill has an epiphany.

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- So, this doll.

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- Let's not call it a doll.

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- It's an action figure.

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And just like that,

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an entire new category
of toy is born.

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One that will dominate the
landscape for years to come.

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Just think
of the play potential

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thousands of accessories,

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each sold separately, of course.

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- It's like a Barbie doll.

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- It's not a doll.

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It's not a doll.

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- So, what's his name?

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- His name is G.I. Joe.

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Merrill's team
quickly gets to work

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on the new action figure.

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Actually, four new
action figures,

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one for each branch
of the U.S. military,

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soldier, sailor, pilot, Marine.

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Now, for the finishing touch.

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- To make them
look rugged so that

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you've never mistake
them for Ken,

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they put a scar on the cheek.

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He was going to be a tough guy.

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The scar
is also a clever way

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for Hasbro to copyright Joe.

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Since otherwise the human figure

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itself can't be copyrighted.

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That means no G.I. Jeff,

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no G.I. Jim,

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no G.I...

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You get the idea.

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Thanks to Hassenfeld's strategy,

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and an aggressive
marketing campaign,

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including commercials
and jingles like this.

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G.I. Joe, G.I. Joe

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Fighting man
from head to toe

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On the land, on
the sea, in the air

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- When G.I.
- Joe storms toy stores

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in the summer of 1964,

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he's a surprise smash.

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G.I. Joe's first
year sales net Hasbro

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a staggering $23 million,
$189 million today.

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Suddenly, Hasbro is the number
two toy company in America,

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right behind Mattel.

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But G.I. Joe's victory
won't last long.

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- As the war in Vietnam
becomes more of a quagmire

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over the course of the 1960s,

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people begin to
associate G.I. Joe

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with the unpopularity
of that war.

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Sales of
G.I. Joe plummet,

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just when things couldn't
get worse for Hasbro,

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a new rival hits the
scene with this ad.

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It's Darth
Vader, watch out!

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It's Kenner's
"Star Wars" action figures.

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Now, I know
the Force is with us.

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- There was a major seismic
shift in the toy world

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when the smaller "Star Wars"
action figures came out.

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It was all in space,

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and G.I. Joe just didn't
fit that narrative.

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To compete
with "Star Wars",

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Hasbro places a call
to some heavenly icons.

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Hello, Angels.

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- "Charlie's Angels" was
a huge, massive success

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in the 1970s.

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You've got these three
kick-ass, bad-ass female leads.

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It was a no-brainer to create

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an action figure
line based on them.

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The dolls are
pretty like Barbie,

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yet action-packed like Joe.

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And with three characters,

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Hasbro believes each child
will want to buy all three.

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Unfortunately, sales are dismal,

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and with G.I. Joe's numbers,

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continuing to decline each year,

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Hasbro loses over
$5 million in 1978,

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forcing them to shelve the
Angels and their iconic soldier.

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A year later, the company
suffers an even more

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devastating blow when
Merrill Hassenfeld dies.

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His son, Stephen
Hassenfeld, takes the reins,

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and there's even talk of
splitting up the company

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since the only breadwinner right
now is the pencil division.

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No wonder they're
only number two.

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Hasbro needs a miracle,

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and they might just get
that miracle on ice?

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Five
seconds left in the game.

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Do you believe in miracles?

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Yes!

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It's 1980,

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and after nearly a decade
of declining sales,

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Hasbro has been forced to shelve
their star-studded soldier.

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And while the company
is struggling,

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their new CEO,
Stephen Hassenfeld,

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isn't ready to
surrender just yet.

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- In the 1980s, you
have the miracle on ice,

00:10:12.106 --> 00:10:15.024
where the US Olympic
team beats the Russians.

00:10:15.109 --> 00:10:18.870
So, American patriotism
is swelling up,

00:10:18.955 --> 00:10:22.532
and you see this in big
feature films and TV shows.

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What a perfect time for Hasbro

00:10:25.953 --> 00:10:29.205
to reboot G.I. Joe
with a brand new name,

00:10:29.298 --> 00:10:32.292
G.I. Joe A Real American Hero.

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And to help
with the reboot,

00:10:33.961 --> 00:10:36.471
they approach a rising
comic book company.

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One that will go
on to create some

00:10:38.215 --> 00:10:41.643
of the highest-grossing
movies of all time.

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- Hasbro needed to redo
the narrative of G.I. Joe

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as a real American hero,

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and take it away from
the direct combat

00:10:49.894 --> 00:10:51.644
that it had
represented in the 60s.

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Especially, as a result
of the Vietnam War.

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So, they turned to Marvel,
who are master storytellers,

00:10:57.151 --> 00:10:59.411
and masters at coming
up with origin stories

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to create this new
mythology, really,

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and this narrative
structure for G.I. Joe.

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And while they hope
the new backstory will be huge,

00:11:08.412 --> 00:11:11.756
the new action
figures will be tiny?

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- In the 1960s, G.I.
Joe is a 12-inch doll.

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Hasbro took a cue from
"Star Wars" action figures.

00:11:20.433 --> 00:11:22.842
When Kenner made
the toys smaller,

00:11:22.927 --> 00:11:24.761
they were able to
save production costs,

00:11:24.845 --> 00:11:26.596
and that's exactly
what Hasbro did.

00:11:26.689 --> 00:11:27.772
- Let's do this.

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Joe 2.0 is
ready for action.

00:11:30.601 --> 00:11:33.269
And he more than answers
the call of duty.

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1983 sees an all-time
high $50 million in sales.

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- G.I. Joe catapulted

00:11:39.952 --> 00:11:42.278
Hasbro to levels it had
never achieved before.

00:11:42.363 --> 00:11:44.372
With Mattel
firmly within reach,

00:11:44.457 --> 00:11:47.951
Hasbro wants to transform
their reputation even further

00:11:48.044 --> 00:11:50.795
from major player to number one.

00:11:50.955 --> 00:11:52.872
That's exactly what they do

00:11:52.957 --> 00:11:56.134
thanks in part to old tin cans?

00:11:56.219 --> 00:11:57.710
- After World War II,

00:11:57.803 --> 00:11:59.796
Japan is actually trying
to rebuild their economy,

00:11:59.889 --> 00:12:02.974
and Takara Toys, based in Japan,

00:12:03.133 --> 00:12:05.310
actually starts
using something that

00:12:05.394 --> 00:12:09.555
World War II soldiers left
behind, empty tin cans.

00:12:09.649 --> 00:12:11.808
They take these tin cans
and they start fashioning

00:12:11.901 --> 00:12:14.644
robotic windup toys out of them.

00:12:14.728 --> 00:12:16.238
By the early 1980s,

00:12:16.397 --> 00:12:20.492
these windup toys called
Diaclone and Microchange

00:12:20.576 --> 00:12:23.578
evolve into even more
sophisticated robots

00:12:23.663 --> 00:12:27.082
that can transform
into vehicles.

00:12:27.166 --> 00:12:29.918
When Takara shows them
off at the Tokyo Toy Fair,

00:12:30.077 --> 00:12:32.578
Hasbro executives there
to scout product ideas,

00:12:32.663 --> 00:12:34.339
love the concept.

00:12:34.423 --> 00:12:35.674
Especially, the fact that kids

00:12:35.833 --> 00:12:38.343
can get two toys for
the price of one.

00:12:38.427 --> 00:12:40.262
So, they quickly buy the rights,

00:12:40.346 --> 00:12:42.505
and change the name of
these transforming robots

00:12:42.589 --> 00:12:45.684
to what else, Transformers.

00:12:45.768 --> 00:12:47.844
But just a few
months before Hasbro

00:12:47.928 --> 00:12:49.521
is set to release
them in stores,

00:12:49.680 --> 00:12:51.690
another company
announces their own

00:12:51.774 --> 00:12:54.359
transforming robots
with this commercial.

00:12:54.443 --> 00:12:57.520
Gobots,
invasion has begun.

00:12:57.613 --> 00:12:59.522
Gobots from Tonka.

00:12:59.615 --> 00:13:02.191
- In business, we typically say,

00:13:02.276 --> 00:13:04.527
get to the market first,
grab market share.

00:13:04.620 --> 00:13:07.613
Hasbro now has a choice to make,

00:13:07.698 --> 00:13:09.699
they have to go
head-to-head against Tonka,

00:13:09.783 --> 00:13:11.367
or they risk losing
millions of dollars.

00:13:11.452 --> 00:13:12.377
Taking a page from

00:13:12.536 --> 00:13:14.454
their successful
G.I. Joe reboot,

00:13:14.538 --> 00:13:17.549
Hasbro, once again,
turns to Marvel for help.

00:13:17.633 --> 00:13:20.385
- It's a lot less expensive
to produce a comic book,

00:13:20.469 --> 00:13:23.555
and as it becomes more
popular kids buy more toys.

00:13:23.639 --> 00:13:25.307
Then, you have the
revenue to create

00:13:25.466 --> 00:13:27.392
the greater stories,
the animated series.

00:13:27.476 --> 00:13:29.394
And of course, the
rest was history.

00:13:29.478 --> 00:13:30.386
In short order,

00:13:30.479 --> 00:13:32.480
the new cartoon and comic book

00:13:32.565 --> 00:13:35.483
helped rocket Transformers
into the stratosphere,

00:13:35.568 --> 00:13:40.313
raking in $115 million
in action figure sales,

00:13:40.397 --> 00:13:42.991
crushing the Gobots
who eventually go-

00:13:43.075 --> 00:13:44.576
- Bye.

00:13:44.660 --> 00:13:46.069
The massive
revenue surge

00:13:46.162 --> 00:13:48.496
also allows Hasbro to expand,

00:13:48.655 --> 00:13:52.158
and buyout one of the most
iconic game makers in America,

00:13:52.242 --> 00:13:53.826
Milton Bradley.

00:13:53.911 --> 00:13:56.338
Now, owning the rights
to hits like Battleship,

00:13:56.497 --> 00:13:58.247
Life, and Candyland,

00:13:58.341 --> 00:14:02.335
Hasbro finally surpasses
Mattel for the number one spot.

00:14:02.768 --> 00:14:04.927
but it's a move that will
come back to haunt them,

00:14:05.012 --> 00:14:09.524
and turn this robust
rivalry into an all-out war.

00:14:13.270 --> 00:14:14.780
In the mid-1980s,

00:14:14.939 --> 00:14:16.523
Hasbro finally passes
Mattel to become

00:14:16.607 --> 00:14:19.275
America's number one toy maker.

00:14:19.360 --> 00:14:21.953
- Mattel and Hasbro
jostled for the position

00:14:22.038 --> 00:14:24.289
of the number one toy company
in the world for many years.

00:14:24.374 --> 00:14:26.116
Not content
with their new status,

00:14:26.464 --> 00:14:28.541
and to stand out
Hasbro's new doll

00:14:28.625 --> 00:14:31.571
will have a rockstar edge to
reflect the new MTV generation,

00:14:33.255 --> 00:14:36.415
but just as they're about to
launch Jem and the Holograms,

00:14:36.500 --> 00:14:38.417
Mattel beats them to the stage.

00:14:38.502 --> 00:14:40.503
I'm gonna get you

00:14:40.587 --> 00:14:43.172
- Somehow Mattel got
wind of Hasbro's plans

00:14:43.257 --> 00:14:45.091
to create a Jem doll,

00:14:45.175 --> 00:14:47.369
so Mattel came up with the idea

00:14:47.439 --> 00:14:49.440
They already had the
infrastructure in place,

00:14:49.599 --> 00:14:52.251
so they managed to
beat Hasbro to market.

00:14:52.435 --> 00:14:53.686
Despite clever ads

00:14:53.770 --> 00:14:55.437
with catchy lyrics
like this one,

00:14:55.522 --> 00:14:57.439
Jem sales are not

00:14:57.524 --> 00:14:59.525
Truly, truly, truly
outrageous

00:14:59.618 --> 00:15:01.369
Hasbro stops production

00:15:01.453 --> 00:15:03.779
just over 18 months
after launching,

00:15:03.864 --> 00:15:07.041
and fall out of their
briefly held number one spot.

00:15:07.200 --> 00:15:08.459
It's not over now

00:15:08.544 --> 00:15:10.128
But what's worse,

00:15:10.212 --> 00:15:11.287
a few years later,

00:15:11.371 --> 00:15:13.297
their attempt to
take on Barbie causes

00:15:13.803 --> 00:15:18.390
- So, in 1996, Mattel launched
a hostile bid for Hasbro.

00:15:18.549 --> 00:15:22.219
With an
offer of $5.2 billion,

00:15:22.303 --> 00:15:25.055
nearly double Hasbro's
current valuation,

00:15:25.148 --> 00:15:28.809
the now number two toy company
would be foolish to say no.

00:15:28.902 --> 00:15:31.311
But when Hasbro
refuses the offer,

00:15:31.396 --> 00:15:33.480
their valuation plummets,

00:15:33.564 --> 00:15:36.325
threatening the future
of their entire company.

00:15:36.484 --> 00:15:38.827
Looks like they need a
hero to save the day.

00:15:38.912 --> 00:15:40.654
Buzz
Lightyear to the rescue.

00:15:40.738 --> 00:15:42.072
Sort of.

00:15:42.156 --> 00:15:44.157
- Hasbro executives
we're strategizing,

00:15:44.242 --> 00:15:45.918
what should we make next?

00:15:46.002 --> 00:15:49.088
And someone brought up the
concept of "Toy Story".

00:15:49.172 --> 00:15:51.581
If a movie can be so successful

00:15:51.675 --> 00:15:53.759
based on these fictional toys,

00:15:53.843 --> 00:15:57.671
why not create entertainment
based on their real toys?

00:15:57.755 --> 00:15:59.339
The obvious
choice to make the leap

00:15:59.424 --> 00:16:03.602
from action figure to
action star, G.I. Joe.

00:16:05.430 --> 00:16:10.684
But then, the war in Iraq has
execs second guessing a movie

00:16:10.768 --> 00:16:12.185
about a renegade
American soldier

00:16:12.270 --> 00:16:14.947
fighting enemies overseas.

00:16:15.031 --> 00:16:17.533
Since Joe's success
lives and dies

00:16:17.617 --> 00:16:20.452
based on the country's
feelings of patriotism.

00:16:20.537 --> 00:16:22.446
If only they had another toy,

00:16:22.530 --> 00:16:24.373
they could give the
Hollywood treatment.

00:16:25.542 --> 00:16:28.535
Oh wait, they do.

00:16:28.619 --> 00:16:32.122
And in 2007, the
revolutionary CGI extravaganza

00:16:32.215 --> 00:16:34.958
that is the "Transformers" movie

00:16:35.051 --> 00:16:37.136
hits screens across the country,

00:16:37.295 --> 00:16:41.465
grossing over $700
million worldwide.

00:16:41.549 --> 00:16:43.633
Eventually, spawning
four sequels

00:16:43.727 --> 00:16:46.720
that will gross $4.8 billion.

00:16:46.813 --> 00:16:48.313
- The "Transformer"
movie for Hasbro

00:16:48.473 --> 00:16:50.891
was a watershed moment
for the company.

00:16:50.975 --> 00:16:53.560
It basically told
them we can do this.

00:16:53.644 --> 00:16:57.731
We can take our toys and
start making big feature films

00:16:57.815 --> 00:17:00.492
based on our own
intellectual properties.

00:17:00.651 --> 00:17:01.994
And when you do a film based

00:17:02.078 --> 00:17:03.653
on your own
intellectual property,

00:17:03.747 --> 00:17:05.497
you get to keep all the money.

00:17:05.656 --> 00:17:07.166
The taste
of Hollywood glory

00:17:07.325 --> 00:17:09.168
has Hasbro hungry for more,

00:17:09.327 --> 00:17:11.244
and still searching
to serve Mattel

00:17:11.329 --> 00:17:13.413
some much needed payback.

00:17:13.506 --> 00:17:16.583
So, using their Tinseltown
success as leverage,

00:17:16.667 --> 00:17:18.752
they convinced
Disney to drop Mattel

00:17:18.845 --> 00:17:20.763
and give Hasbro
the rights to make

00:17:20.847 --> 00:17:23.507
their entire line
of princess toys.

00:17:23.591 --> 00:17:25.100
The move isn't just shrewd,

00:17:25.259 --> 00:17:27.677
it's as cold as ice,

00:17:27.762 --> 00:17:30.189
since it means Hasbro
is the first company

00:17:30.348 --> 00:17:33.692
allowed to make
these snowy sisters.

00:17:33.777 --> 00:17:35.527
- "Frozen" was a
highest-grossing

00:17:35.612 --> 00:17:39.606
animated movie of all
time, at that time.

00:17:39.690 --> 00:17:41.107
They didn't know that
it was going to become

00:17:41.192 --> 00:17:43.777
this huge phenomenon,
but you know,

00:17:43.861 --> 00:17:45.704
never bet against Idina Menzel.

00:17:47.281 --> 00:17:49.032
The billions
in sales, once again,

00:17:49.116 --> 00:17:51.451
help push Hasbro pass Mattel

00:17:51.536 --> 00:17:54.046
as the number one
toy maker in America.

00:17:54.130 --> 00:17:55.372
And guess what?

00:17:55.456 --> 00:17:57.707
It's a title they
still hold today.

00:17:57.792 --> 00:18:00.719
Now, worth over $5 billion.

00:18:00.804 --> 00:18:03.639
In addition to the
iconic toys they created,

00:18:03.798 --> 00:18:06.642
Hasbro also owns the
rights to hit brands

00:18:06.726 --> 00:18:11.396
like Tonka, Nerf, Play-Doh,
Monopoly, Scrabble,

00:18:11.481 --> 00:18:14.724
and the entire line of
"Star Wars" action figures.

00:18:14.809 --> 00:18:17.727
Guess the Force is
now with Hasbro.

00:18:17.812 --> 00:18:22.574
- Hasbro was such an integral
part of all of our childhood

00:18:22.659 --> 00:18:24.651
that I think
everyone really holds

00:18:24.735 --> 00:18:26.912
a real piece of Hasbro
close to their heart.

00:18:26.996 --> 00:18:28.154
Proving that,

00:18:28.248 --> 00:18:30.165
just like their classic
commercials say,

00:18:30.250 --> 00:18:33.085
when it comes to
Hasbro there's...

00:18:33.169 --> 00:18:35.003
More than meets the eye