Hasbro Slapped by Bank of America For ‘Destroying Customer Goodwill’
Bank of America has once again stated that Hasbro continues to “underperform” while destroying customer goodwill.
Hasbro has come under fire recently, leading Bank of America to once again reiterate the “Underperform” rating for the toy giant. In a report by Business Insider, Bank of America called out Wizards of the Coast’s recent troubles as destroying customer goodwill, stating that the company might face a steep decline if that trend continued.
This of course, follows in the wake of the recent OGL leaks and backpedaling, resulting in the SRD 5.1 being released into Creative Commons.
In a recent interview, one of WotC’s executives maintained WotC’s line of “trying to do what’s best for the community.” However, executive leadership may be at odds with what’s best for both company and community. One of the biggest issues for BofA was that Hasbro, and WotC in particular, was in danger of killing its golden goose.
BofA Slams WotC For Destroying Customer Goodwill
According to BofA, Hasbro’s single biggest problem is trying to over-monetize the brands at WotC. This directly contradicts a fireside chat by WotC CEO Cynthia Williams, who claimed that Dungeons & Dragons was under-monetized. BofA maintains that this drive to increase monetization is one of the leading factors in its declining price:
“Within its Wizards segment, Hasbro continues to destroy customer goodwill by trying to over-monetize its brands.”
This sentiment echoes BofA’s earlier rebuke, which led to a downgrade of Hasbro’s stock rating in November 2022. BofA warned that Hasbro was “killing its golden goose” by over-saturating and over-monetizing Magic: the Gathering.
Of course, the OGL change/walk back has left an impression on not just the community of gamers. But potential shareholders and investors were cautioned by Bank of America as well, who maintain that over-monetization will damage the long-term durability of the brands:
“We remain especially cautious on Hasbro’s Wizards segment given its over-monetization of Magic. Wizards recently tried a similar tactic with D&D-proposing changes to its licensing agreement which led to substantial pushback from the community including calls to boycott the D&D movie.”
Of course, D&D’s EP is making the rounds, claiming that Wizards of the Coast was planning to change things all along and that no amount of boycotts or canceled subscriptions would force WotC to reverse course. This is despite the infamous “they’ve won, and so have we” statement where they admit to changing their plans based on community feedback.
In the wake of all of this, Bank of America cautioned investors, warning of “weak fan engagement with Hasbro’s brands” and a “fading appetite” for potential over-monetization as “key downside risks for the stock.”
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