How ‘Star Wars’ Revolutionized the Toy Industry

The eye-opening new Netflix docuseries ‘The Toys That Made Us’ chronicles how the biggest toy fads came to be. And no toy phenomenon’s backstory quite matches that of ‘Star Wars.’


Most childhood Star Wars obsessives can remember the first time they held a piece of the lore in their hands. A three- and three-quarter inch tall Chewbacca, perhaps, or a bright yellow-haired Luke Skywalker; an X-Wing or Millennium Falcon, if you were lucky, or maybe a puzzle, a board game, or trading cards. Mine came with a fast food meal, a plastic R2-D2 that cracked open to reveal a tiny Princess Leia figurine. I’d just seen Star Wars for the first time hours earlier for its 20th anniversary theatrical re-release, and finding her there felt momentous somehow, like it had in the movie. Sitting there at a Taco Bell in my dumpy California hometown, my nine-year-old mind decided: I am Luke Skywalker.

Toys are powerful tools of imagination for kids. But there’s a reason lots of them, especially Star Wars toys, still appeal to adults, too. They’re the result of an intrinsically human impulse, one that seeks to turn abstract ideas (in this case, a movie set in a fictional galaxy, populated by larger-than-life figures) into something tangible. It’s how we process some of our most culturally important ideas, from religion to a nation’s character: we turn them into objects we can touch, feel, and imbue with meaning—a flag, a cross, a chain of beads, and so on.

It’s of no small value then for creator Brian Volk-Weiss to turn an anthropological eye to our most beloved childhood objects in his eight-part Netflix docuseries The Toys That Made Us. Each hour examines a different toy phenomenon of decades past, from Barbie and G.I. Joe (the two most popular toy brands in America pre-Star Wars) to LEGO, He-Man, Transformers and Hello Kitty. Few have as wild a story to tell, of course, as Star Wars and its first toy line’s infamously wonky origins and unexpected success.

To put the sheer dollar impact of these little hunks of plastic into perspective: the Star Wars saga has earned over $7 billion at the box office. But the toys based on that saga? Twice that amount. Over a billion Star Wars toys have made their way into the hands of fans and collectors since 1978, made of enough plastic to melt down and remold into a Wookiee the size of the Empire State Building. Yet just as with the first Star Wars film itself—which was famously passed over by Universal and laughed off as a surefire failure, pure science fiction gobbledygook—it’s a miracle George Lucas ever got a single toy made at all.

The deal they struck with Lucas and 20th Century Fox (which handled licensing for Star Wars) was an historic disaster for Lucas—and the deal of the century for Kenner.

It was Lucas’ idea to create toys modeled after the concept art for his film, a savvy prospect but dauntingly unprecedented. Until then, a movie had never successfully launched a toy line. Next to the built-in advertising of an ongoing TV show or comic book (which, unlike films, stayed in the public consciousness longer than three months), it seemed foolhardy. Worse, in a bid to maintain secrecy, Lucas had allowed only six months before Star Wars’ release for a toy company to design and produce a line of action figures, an overwhelmingly convoluted process that normally takes up to two years.

One by one, every toy company including Hasbro, Mattel, Parker Brothers, and Mego (which produced DC and Marvel Comics toys), turned Lucas down. All, that is, except for the last one Lucas approached: a small, Cincinnati-based company, then a division of cereal maker General Foods.

Kenner Products, a scrappy toy company then based on the 11th floor of some Brutalist monolith in downtown Cincinnati, happened to employ a few sci-fi fans who had been following Lucas’ career and saw potential in his Star Wars script. The deal they struck with Lucas and 20th Century Fox (which handled licensing for Star Wars) was an historic disaster for Lucas—and the deal of the century for Kenner. For every dollar sold on Kenner’s Star Wars toys, Lucas and Fox split only a nickel. The rights, as Kenner’s then-lawyer Jim Kipling recounts onscreen with a chuckle, were to extend “intergalactically” for the rest of time.

It seemed no huge loss to Fox, though Lucas was always miserable with the terms. (“Well,” the show’s narrator quips, “George was never happy.”) Still, Kenner had a problem: by the time the ink dried on that merchandising deal, Star Wars was only a month away from theaters. Desperate measures included what Kenner’s toy designers indelicately recall as “labelslapping”—that is, retrofitting recycled toys with new paint and slapping new stickers and the Star Wars logo on them. (Even the action-figure prototypes designers used in their first presentation to Fox were former Fisher-Price truck drivers, just carved up, whittled down, and remolded with Bondo putty. Dave Okada, a designer, merrily recalls cutting off the toes of his own sock to create a little brown cloak for a Jawa: “We kept showing that thing with my stinky sock for weeks.”)

By Christmas 1977, Star Wars had become the highest-grossing film of all time, and Kenner still had no toys to sell other than quickly-manufactured picture-based products like puzzles, board games, and paint sets. Enter the Star Wars Early Bird Certificate Package: an empty box, essentially, save for a few stickers and a certificate kids could fill out and send in to guarantee they’d be among the first to own a set of Kenner’s action figures. The lineup included Han Solo, Leia, Luke, R2-D2, a Stormtrooper, C3PO, and a curious little fellow named “Death Squad Commander” (soon re-dubbed “Star Destroyer Commander” because, what?).

By the time Kenner’s action figures finally materialized for purchase, it was spring 1978—nearly a year after Star Wars had hit theaters. And still, toys flew off store shelves. (“People were literally attacked when they saw these boxes coming out,” swears Corky Steiner, a former Kenner manager and the son of Kenner co-founder Philip Steiner.) According to an ABC news report from the time, industry-wide toy sales went up eight percent in the frenzy; Kenner sales skyrocketed by forty.

Two years of this massive success and Lucas apparently grew impatient enough with his merchandising deal to send a literal bodybuilder to renegotiations with Kenner’s lawyer. Bizarrely, Kipling recalls the heavy at one point standing up, planting a foot in his chair, and flexing his muscles, yelling, “I don’t want to hear any more of this!” The resulting contract allowed Kenner to hold onto Star Wars’ exclusive rights in perpetuity—as long as they produced enough merchandise a year to pay Lucasfilm $10,000 in royalties. If they failed, they’d have to write the check themselves to make up for it. Easy enough, right?

The endless quirks associated with the early days of Star Wars toys gives The Toys That Made Us its best material, from Luke’s inexplicably changing hair color—it was yellow-blond at first, then a sandier color; one designer shrugs and chalks it up to a factory mistake—to the story of how Kenner settled on the toys’ famous 3.75-inch height, bucking the industry standard of 12 inches for action figures. (Bernard “Bernie” Loomis, a towering figure in the toy industry with fingers the size of “Dodger hot dogs,” as Okada recalls, was asked how tall Luke should be. He simply thrust a fist out, then extended his thumb and forefinger: voila, three and three-quarter inches.)

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The legend of Kenner’s rocket-firing Boba Fett, of which only a few hundred were made and which can now fetch up to $20,000 at auction, is extra amusing. The Holy Grail of Star Wars toys, originally part of a mail-in promotion, it was made from mashed-together parts of C3PO figures (the droid’s crotch, namely) and Death Star Commanders. Until then, Boba had only had a brief cameo in the Star Wars Christmas special, creating an aura of mystique around the character. That soon gave way to disappointment when the figure finally materialized without its promised rocket-firing feature. Mattel, it turns out, had created Battlestar Galactica toys with similar rocket-firing capabilities—which had promptly found their way into the back of kids’ throats. Kenner scrapped the Boba figure and never took it to retail.

We check in with Steve Sansweet, an ex-Lucasfilm employee whose collection of over 400,000 Star Wars toys forms Rancho Obi-Wan, a non-profit museum. We catch glimpses of Kenner’s failed 1982 Micro Collection, on which the company bet millions through a set of 70 die-cast figures (including, strangely, one of Luke in his underwear). And we quickly tour the surreal, often hilarious world of Star Wars counterfeit toys. The crown jewel: a Turkish line that avoided copyright infringement by dropping random letters from “Stars War” characters’ names, like “Dart Vader” and “Che Bacca.” It also included a notorious figure called Head Man, equipped with a sword and shield, and an Imperial Gunner whose Death Star controls look suspiciously like a 1980s calculator.

And we learn of the “dark times,” from 1986 to 1995, when Lucas laid the Star Wars brand to rest and toys stopped selling the way they once did. Hasbro bought Kenner in 1991, closed its Cincinnati office, and somehow, forgot about the Star Wars merchandising deal’s $10,000 stipulation. It failed to pay Lucas his share and the contract expired. Coincidentally (or not, probably), a year later, Lucas announced he would direct a prequel trilogy, sparking a bidding war for merchandising rights among toy companies. Hasbro managed to wrangle the deal back, but only at a base royalty rate of 18 percent for Lucas. (The deal was dubbed “George’s revenge.”) Still, Hasbro dived headfirst into production on toys for the prequels. Then its designers actually watched The Phantom Menace. “Oh no,” remembers then-Hasbro CEO Alan Hassenfeld. “What did we do?”

Cue morbid shots of discount bins full of Jar Jar toys. A Jar Jar Pez dispenser. A Jar Jar plush. A Jar Jar Binks bank! A bleakness takes over the Star Wars landscape through Revenge of the Sith, with the exception of the Clone Wars animated series, whose starring character Ahsoka Tano “sold quite well.” Until, of course, Disney bought Lucasfilm for $4.5 billion in 2012, and our current, rejuvenated Star Wars mania took hold.

There’s a singular pleasure that comes with holding a Star Wars toy. The film’s vehicles, weapons, heroes, and villains, after all, are uniquely “toyetic,” as Loomis famously dubbed them. They make you want to pick them up, pose them, swing them around—is there anyone who doesn’t want a real-life lightsaber?—and give them voice, even without necessarily knowing what they are. It’s how kids are often introduced to Star Wars: through the toys, the costumes, the X-wings and TIE fighters, light and dark-coded objects seemingly brimming with intrigue. They’re as much a part of the fabric of American culture now as the films—and a large part of the reason Star Wars still endures over 40 years later.