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Prices make feathers fly for Angry Birds' merchandise (2)

By He Wei  (China Daily)

15:08, August 20, 2012

Before the store opened, the first official apparel to go on sale in China was a line of Angry Birds shoes, sold on Letao.com, an online retailer exclusively selling footwear.

To further penetrate the market that has helped to drive the company's thriving growth, the firm outlined a series of China-related business plans in June that also include opening activity parks.

According to Vesterbacka, two Angry Birds activity parks will be established in the coming autumn. One will be in Haining, Zhejiang province, and the other, smaller in scale, will be in the Sino-Finnish Center at Tongji University in Shanghai.

Rovio's sales jumped 10-fold to around $100 million last year as gamers flocked to download its titles. Consumer products, which include merchandising and licensing, generated around 30 percent of its revenues.

Rovio has to deal with rampant intellectual property violations and sales of counterfeit merchandise.

Paul Chen, the company's China head, believed their strong brand presence in China would make it easier for buyers to get authorized products. He expected revenue in China to triple in 2012, thanks to booming licensing income.

But market observers had their doubts about the ambitious plan.

"In a largely cost-conscious market, many users just want birds that look like those in the games, no matter whether they are authentic or not," said Sun Mengzi, a games specialist with IT consultancy Analysys International.

Sun said Rovio's moves have indicated how closely it is following in the footsteps of The Walt Disney Co, by creating memorable animated characters and a profitable product line.

"Because users don't spend a lot of time on casual games, it is important to transform their current success into long-standing, physical figures that you can reach in your everyday life," Sun said.

But there are two sides to the coin. While the bird-slinging game gained popularity because of its simplicity and the little time commitment it required, it is not easy to maintain "stickiness" of use.

That would put a dent in the sales of spin-offs in the long run. "If people lose interest in the games, why would they pay to get the toys?" Sun asked.

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