Although toys are the marquee product at the American International Toy Fair, they are really just the focal point of a much larger panorama of marketing strategies, entertainment programs and emerging cultural trends that are on display at the annual event in New York City. Toy manufacturers are now closely associated with a variety of other industries, from production studios to marketing companies to ad agencies and retailers. As a result, Toy Fair has become a kind of bellwether of upcoming trends and a place where a wide cross-section of people come to shop not just for toys, but also for insights into what’s new and hot.

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With DreamWorks SKG’s feature film Small Soldiers to launch this summer, the studio and master toy licensee Hasbro are readying their toy troops for the battle against the armies of licensed toys from other would-be blockbuster films.

Unlike the entirely animated setting of Toy Story, Small Soldiers takes place in a real-world environment in which the toys appear alongside human characters in much the same way as the dinosaurs and human stars in The Lost World: Jurassic Park. The story unfolds at a toy company when, after the company’s recent acquisition by a computer conglomerate, Small Soldiers action figures accidentally become equipped with top-secret artificial intelligence chips intended for the new parent company’s military division. An all-out war breaks out on the streets of Winslow Corners, Ohio, between the Commando Elite and Gorgonite figures.

DreamWorks is developing a big merchandising program behind the property, and the film’s stars couldn’t be better suited to the task. ‘Small Soldiers is one of those rare properties that works equally well for entertainment as well as merchandise,’ says Karl Aaronian, head of DreamWorks Toys. ‘This is an action-adventure film that has a natural conflict and good versus evil characters. . . . It has multiple characters that are prominently featured, so it gives us that breadth to go in many different directions with the product line.’ And the film also incorporates vehicles and accessories that add to the role-playing opportunities for kids. Plus, says Aaronian, the film’s concept is ‘one of the purest, biggest kid fantasies-toys that have seemingly come to life.’

Kids will be hard-pressed to miss the film’s merchandise, with products ranging from apparel to housewares, gifts and toys. Hasbro alone is creating more than 100 items. In addition to action figures and vehicles-which Aaronian describes as ‘the backbone of the overall toy program’-also in the works from Hasbro are puppets, plush toys, giant-sized figures, activity products, board games, puzzles, handheld electronic games, and a PC CD-ROM game (from Hasbro Interactive). The primary target audience is boys age four to nine. Almost 20 other toy licensees are on board, including Basic Fun for key rings, Spectra Star for kites, model kits, yo-yos and flying discs, Tiger Electronics for youth electronics and Topps for trading cards, comic books and candy.

The toy development process with Hasbro is aided by a strategic alliance that names Hasbro as the master toy licensee for all the studio’s merchandisable films. DreamWorks has secured similar agreements in publishing with Penguin Putnam and Landoll. The studio is also a partner in a joint venture with Microsoft to form DreamWorks Interactive.

Hasbro became involved in the toy development for Small Soldiers as DreamWorks was fleshing out early story outlines and ideas for characters. Initial ideas from Hasbro were received four to six weeks after the first meeting, with Hasbro working on an accelerated time line to bring out toys for a 1998 release, instead of the 1999 date originally planned for the film. When the story and character designs approached later stages, other Hasbro groups outside of action figures and other licensees joined the merchandising program.

When it comes to Hasbro influencing the film to benefit the toys, merchandising concerns take a backseat to making a good movie. ‘[DreamWorks is] very much a creator-based studio and the merchandising area is never going to drive the development of the film,’ says Aaronian. Still, he adds, a great idea that improves the film’s entertainment value can come from Hasbro, although ‘it doesn’t happen often’ that such input makes it into the film.

Where Hasbro did have input was in ensuring that the toy company and the action figures looked true to life. ‘We certainly picked their brains-and our brains because we’re ex-toy people-in terms of how would a toy company really approach the development of a toy line and how would an action figure really work, what are the limitations to an action figure, how would it really move, all of those [aspects].’

The property will debut at Toy Fair. Hasbro showed a sizzle tape of the film to retail buyers at its annual pre-Toy Fair event in September, but Toy Fair will be the first time that buyers will get an ‘entire look at the property from a movie perspective as well as the toy line,’ says Aaronian. The toys are scheduled to ship to stores a couple of months before the film’s July release to ensure that product arrives on store shelves a few weeks before opening day.