Western companies looking to reach Chinese auds have long been daunted by high regulatory and creative hurdles, a problem Hasbro Studios — the entertainment arm of the toymaker behind “Transformers” and “My Little Pony” — is solving with localized co-productions.

Up first is “DoPei Le Doh,” a localized mix of live-action and animation based on Hasbro’s Play-Doh brand. The show is a co-production with Toonmax, part of the Shanghai Media Group, and its 52 episodes will air in primetime on China’s second-largest children’s channel.

The company has long done business with China, with a manufacturing relationship that runs back almost 30 years, says Hasbro Studios prexy Stephen Davis.

As branded entertainment opportunities opened up in China, it became clear that getting the maximum return and benefit for Hasbro’s retail strategy required more than just importing or modifying existing content.

“Unlike a lot of other territories in the world, both from a creative as well as from a regulatory perspective, the most impactful content that’s getting on in primetime is local Chinese content,” he says.

Hasbro is already at work on localizing its “Family Game Night” format for China; the format has already been successfully localized with Spain’s Boing.

Hasbro also has been striking up co-productions for animated content, and the studio is making such programs in nine countries to take advantage of local tax structures and co-production funding.

“The opportunities on a co-production and tax structure basis are probably better now than I can remember in the 20-plus years I’ve been in this business,” Davis says.

Such co-productions are likely to become a key way for companies to reach a massive Chinese market that is slowly opening to non-domestic content but still subject to quota limitations on foreign films and broadcasts, says Kevin Geiger. The animation industry veteran has been based in Beijing since 2008 as prexy and CEO of animation development company Magic Dumpling Entertainment.

“It’s important not only to localize the co-production content for domestic audience acceptance, but also to get the branding and economic metrics right for domestic market acceptance,” says Geiger.

The branded-play strategy has been a hit for the toymaker, especially overseas. The company’s 2011 annual report showed international revenues up 19% to $1.86 billion, with a 19% boost in entertainment and licensing net revenues attributed to growing international TV sales.

Davis expects the company’s co-production strategy will grow its global entertainment presence and allow it to introduce more brands more aggressively and more quickly, both in television and in features.

Key to making the strategy work is an ability to be flexible in working with local partners, choosing co-production partners carefully and allowing local proclivities into the mix without altering or diluting the core essence of the brands, says Davis.

“We have to pick our partners very carefully and, obviously, it requires quite a bit of give and take,” he says. “I think we’re very good partners in that respect, although we take our brands very seriously.”

Geiger says that kind of flexibility is welcome in China. “Chinese producers are very open to foreign collaborations, and they are even more enthusiastic when the working relationship is true creative co-production and not merely a service relationship,” he says.

Brand dilution is key among risks with the strategy, and maintaining a consistent, core DNA to each brand is important, Davis says. Additionally, content providers have a hard time preventing piracy of all types in China.

“A strategy to capitalize on the legitimate Chinese ancillary market and minimize the effects of the black market will also be crucial to the success of the endeavor,” Geiger says. “There are ways to effect this, but many of the necessary structures for implementation and enforcement are lagging behind in China.”

Davis says he hopes that localized content will eventually be able to sit side-by-side with an internationally produced version of the same show.

“I think that in some markets like China, that’s still probably three to five years away,” he says. “But that’s OK, because we are making a longterm investment in the business and we have the added benefit of supporting a bigger, branded-play strategy, which is expressed in toys and games, and lifestyle licensing and digital gaming.

“So it’s not just about one form — it’s about multiple forms and formats.”

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