Zynga Gets Touchy Feely

If you thought the disproportionate cartoon characters in Zynga's (Nasdaq: ZNGA  ) massively popular CastleVille game were to be forever relegated to the ethereal realm of cyberspace, think again.

Toy maker Hasbro (Nasdaq: HAS  ) and Zynga have announced a partnership that grants Hasbro the rights to develop toys and games based on Zynga's brands. The company now has the ability to develop and distribute any number of offerings based on FarmVille or CityVille, among other popular names.

The move is certainly intended to strengthen both companies' brands and awareness, but there are limits on their matrimony. Zynga won't have the rights to make digital versions of many of Hasbro's timeless board game classics like Monopoly, as that privilege has long been held by gaming Goliath Electronic Arts (Nasdaq: EA  ) .

It's even more interesting that Hasbro is partnering with the acquisitive social game maker, since Zynga bought smaller developer Newtoy just over a year ago. Thanks to that acquisition, Zynga's repertoire now includes the popular mobile game Words With Friends, which is a pretty blatant ripoff of one of Hasbro's longtime cash cows, Scrabble.

Words With Friends trounces EA's Scrabble app in the mobile arena, with over 20 times more daily active users. Words With Friends sees about 8.8 million players every day, compared to Scrabble's measly 410,000.

Zynga's trying to promote its brand strength in the same way that Angry Birds has stepped into the real world with its branded t-shirts, backpacks, and an unofficial theme park in China. Zynga will never reach Angry Birds-esque levels of recognition, and it doesn't help that Zynga's actual business model involves blatant ripoffs, which only hurts its brand perception.

With Zynga's first public earnings release set for next week, we'll let the numbers speak for themselves. It won't take much for Zynga to make a better first impression than fellow overhyped IPO and social butterly Groupon (Nasdaq: GRPN  ) did.

Zynga is decidedly not a Rule Breaker with multibagger potential. It just likes to pretend that it is, which only makes it a Faker Breaker. If you really want to Discover the Next Rule-Breaking Multibagger, ignore Zynga and check out this new special free report. There are six signs of a true Rule Breaker, and this company scores on all six. I've even already bought it in my own personal portfolio. Get your free copy of this report now to see why it might fit in yours.

Fool contributor Evan Niu holds no position in any company mentioned. Click here to see his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Hasbro. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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