The Perfected TV-Synchronized Model
The competitive strategy of Bandai that I analyzed in a 2005 paper — which received the Porter Prize — can be distilled into one concept: "fully TV-synchronized character merchandising." Bandai at the time was not a company that simply chased popular characters to make products. It partnered with production companies from the program planning stage, designing characters, storylines, items, toys, commercials, distribution, and inventory management as a single integrated system.
The essence of this model was not about randomly hitting on blockbuster products. It was about precisely synchronizing product development, promotion, distribution, and inventory management to television — a massive synchronization device. A new character or item would appear in a show. Children would become immersed in that world. Immediately afterward, commercials within the program would present the product, and the same product would appear on store shelves at exactly the same time. The system converted the moment of peak emotional engagement into purchasing behavior.
As the Porter Prize analysis documented, Bandai's product designers participated in meetings with production companies from the program planning stage, contributing to character and item design. This enabled product launches timed to broadcast premieres and new character introductions, while ensuring that merchandise stayed true to the character's world.
Bandai's strength also lay in the breadth of its product categories. Character merchandise spanned toys, figures, capsule toys, confectionery toys, games, household goods, and apparel. As of 2004, character products accounted for 73.6% of total sales. Moreover, half of revenue came from established, serialized characters, providing a stable earnings base that funded investment in new character properties.
Bandai's competitive advantage was not merely about "having good characters." It lay in the organizational capability to synchronize internal and external activities around IP.
The media division managed new character and program launches, licensing acquisition, negotiations with rights holders, coordination across internal product divisions, and profit management on a per-character basis. Bandai was a toy company in name, but in substance, it was a sophisticated IP management enterprise.
The Collapse of the Golden Triangle
Underpinning this model was the "Golden Triangle" of television networks, publishers and rights holders, and merchandising companies like Bandai. TV networks provided broadcast slots and viewer touchpoints. Publishers and rights holders supplied original works and characters. Bandai handled merchandising, sponsor advertising, distribution, and inventory management. Prime-time terrestrial television was a massive media apparatus that simultaneously generated awareness and desire among children.
From the mid-2000s onward, however, this foundation began to erode. Declining birth rates, after-school lessons and tutoring, the spread of mobile phones and the internet, and changes in television viewing behavior all weakened the assumption that children would be sitting in front of the TV at a fixed time. From the networks' perspective, the rationale for placing children's anime in prime time declined, and anime dispersed to weekend mornings, late afternoons, late-night slots, satellite channels, and streaming platforms.
What happened, however, was not a decline in the popularity of anime or characters. Rather, the mechanism for creating demand simultaneously through television as a central device had weakened. After losing its golden prime-time slots on terrestrial TV, the anime industry diversified its revenue streams into late-night anime, production committees, DVD/Blu-ray, source manga, music, events, games, and streaming.
Resurgence as a Global IP Industry
Entering the 2020s, anime experienced a massive resurgence. But this was not a revival of the old golden age of TV anime. The current anime boom is not a domestic character merchandising business centered on terrestrial television. It is a flourishing global IP industry spanning streaming, social media, music streaming, film, games, merchandise, events, and cross-border e-commerce. According to the Association of Japanese Animations, the broad anime industry market reached a record 3.84 trillion yen in 2024, with the overseas market at 2.17 trillion yen — surpassing the domestic market.
The role of anime in the music business has also fundamentally changed. Anime theme songs were once viewed as a subset of the program, or as an independent genre called "anison." Today, anime tie-ups have become a powerful discovery channel for J-Pop and J-Rock worldwide. Japan's music streaming revenue reached 113.2 billion yen in 2024, accounting for 91.8% of total digital music sales. In the streaming era, what matters is not just the power of the song itself, but the context in which it is discovered. Anime gives songs narrative, characters, visuals, emotion, and fan communities. Non-credit openings, YouTube, TikTok, international reaction videos, fan art, live performances, and playlists work together to spread music domestically and internationally. Anime tie-ups have evolved from mere promotional slots into a global music discovery engine.
Bandai Namco's Evolution
It would be a mistake to interpret the relative decline of the fully TV-synchronized model as the collapse of Bandai's competitive advantage. On the contrary, the Bandai Namco Group has evolved from a character business dependent on a single synchronization device — television — into a global IP enterprise that unifies multiple business domains and fan touchpoints worldwide around IP.
In fact, Bandai Namco Holdings achieved record performance in fiscal 2024: net sales of 1.24 trillion yen, operating profit of 180.2 billion yen, and net income attributable to shareholders of 129.3 billion yen. Even as the legacy TV-linked toy model has relatively weakened, the group as a whole has dramatically expanded its earnings base.
Growth is not concentrated in a single area. In fiscal 2024, the Digital, Toys and Hobby, IP Production, and Amusement segments all grew revenue. In Toys and Hobby, products targeting high-age demographics, trading card games, and Gunpla performed strongly, with sales expanding in North America and Asia. By IP, established franchises such as ONE PIECE, Gundam, and DRAGON BALL grew through a combination of media deployment, flagship products, new product launches, and international expansion.
The IP Production segment also contributed through box office revenue from theatrical releases like "Mobile Suit Gundam SEED FREEDOM" and "Blue Lock THE MOVIE -Episode Nagi-," global video distribution, licensing, and live event-related package sales. IP is no longer simply something to be merchandised — it is monetized across video, music, events, licensing, and international markets.
"Red Bandai" and "Blue Bandai"
This transformation does not mean Bandai has lost its roots. Rather, the capability Bandai possessed in 2005 — synchronizing programs, products, distribution, promotion, and organization around characters — has been extended as a group-wide IP-centric strategy. Where the synchronization targets were once TV programs, toys, commercials, and retail stores, they now encompass games, video content, music, streaming, Gunpla, figures, trading cards, official shops, events, e-commerce, global fan communities, and data analytics.
This evolution is reflected in Bandai Namco's medium-term plan. The three-year plan starting April 2025 sets "Connect with Fans" as its long-term vision, aiming to build broad, deep, and complex connections with IP fans, partners, employees, and society worldwide. The plan articulates four key themes — "Make Great Products," "Expand Further," "Keep Nurturing," and "Refine and Deepen" — driving new IP creation, category expansion, geographic expansion, IP brand cultivation, and data utilization.
The structural shift is symbolized by the divergence into "Red Bandai" and "Blue Bandai." BANDAI SPIRITS, established in 2018, was created to drive business growth in the global high-target market, developing Gunpla, figures, robots, character lottery prizes, and amusement prizes for worldwide distribution.
If Red Bandai represents TV-program-linked character merchandising for children and families, then Blue Bandai — BANDAI SPIRITS — represents IP merchandising for adults, international markets, premium price points, and long-tail demand. Bandai Namco has evolved from a children's TV-linked toy company into a global IP merchandising enterprise.
What the Super Sentai Hiatus Symbolizes
Another powerful symbol is the hiatus of the Super Sentai television series. Toei began broadcasting "Ultra Space Sheriff Gavan Infinity" in the Sunday 9:30 AM slot on TV Asahi starting February 15, 2026. The series is positioned as the first installment of "PROJECT R.E.D.," a new tokusatsu franchise following the Super Sentai hiatus.
Super Sentai was the perfected form of the Bandai model. Every year, a new team, new transformation items, new weapons, new combining robots, and new role-play toys were introduced, synchronized with a full year of television broadcast and product releases. New robots, mechs, and items appeared in tandem with the story's progression, creating children's desire and converting it at retail. This was the quintessential TV-synchronized character merchandising playbook.
In today's market, however, this annual-reset model has become relatively difficult to sustain. Children's TV viewing touchpoints have fragmented, and the path to toy purchase no longer runs exclusively through TV commercials and store shelves. Meanwhile, the IPs that are growing are those like Gundam, Dragon Ball, and ONE PIECE — properties that can be operated long-term across adult demographics, international markets, games, streaming, figures, model kits, trading cards, events, and e-commerce.
Bandai Namco's fiscal year ending March 2025 data shows group-wide IP revenue of 6.4 billion yen for Super Sentai, versus 153.5 billion yen for Gundam, 190.6 billion yen for DRAGON BALL, and 139.5 billion yen for ONE PIECE. In domestic Toys and Hobby alone, Super Sentai generated 5.4 billion yen compared to 75.7 billion yen for Gundam and 94.2 billion yen for ONE PIECE. Super Sentai has not lost its value, but the format — multiple team members, color-coding, transformation, giant robots, annual resets, children's focus, toy tie-ins — becomes a constraint in the context of global IP operations.
The Super Sentai hiatus, therefore, is not merely the end of a single series. It signals a historic turning point for the model that once stood at the center of Bandai's competitive advantage: "children's terrestrial TV program × toy sponsor × annual product cycle." At the same time, the establishment of BANDAI SPIRITS, the shift toward high-target demographics in the Toys and Hobby business, integration with digital, video, music, and amusement operations, and Bandai Namco's record overall performance all demonstrate that the center of gravity for growth has shifted to adults, international markets, collectors, premium pricing, long-tail IP, and multi-layered fan engagement.
The Center of Synchronization Has Shifted
In conclusion, the essence of Bandai has not changed. What has changed is the center of synchronization. In 2005, the winning formula was synchronizing characters, programs, products, commercials, distribution, and inventory around television. Today, the winning formula is synchronizing streaming, film, music, social media, games, merchandise, events, e-commerce, global fan communities, and data around IP itself.
The fully TV-synchronized character business has not ended. The old model centered on television has evolved into a global fan-touchpoint synchronization model centered on IP.
Bandai Namco is the company that most clearly embodies this evolution. While parts of the legacy model have contracted, the group continues to grow into a larger business system built around IP as its axis.
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