We had the opportunity to have an exclusive interview with Justin Scarpone, SEGA Corporation’s Executive Vice President and Head of Global Transmedia Group, who shared insights into SEGA’s evolving strategy and future plans. With a rich background including 17 years at Disney, where he notably led the Kingdom Hearts franchise globally, and experience establishing Scopely’s Asian operations, Scarpone brings valuable entertainment industry expertise to SEGA’s expanding horizons.

From Gaming Giant to Entertainment Powerhouse 

SEGA’s transformation extends beyond traditional gaming boundaries, with the company strategically positioning itself as a comprehensive entertainment entity. At the helm of this evolution is the newly established transmedia group, created in April 2024, focusing on developing SEGA’s core IPs across multiple platforms and formats.

“We are one of the companies to watch within the gaming industry who are becoming truly a more general entertainment company,” Scarpone explained. 

“We are evolving into an entertainment company with games as our core business,” Scarpone added, drawing parallels to Disney’s model while emphasizing SEGA’s unique approach. 

“Similar to how the Walt Disney Company might say they are an entertainment company with films as their initial entry point for new IP, for SEGA, the entry point to the IP for our fans is always going to be the games.”

Core IP Strategy 

SEGA’s current focus centers on four major IPs that drive significant revenue and operating income. “There are certain core IPs today, from a game perspective. So we know it, obviously Sonic, obviously Angry Birds, which we acquired last year. Obviously Persona, and obviously Like a Dragon,” Scarpone detailed. The success of these franchises has proven SEGA’s ability to maintain and grow strong IP portfolios both through internal development and strategic acquisitions.

Each of these core IPs plays a crucial role in SEGA’s transmedia strategy, with plans for expanded content across various platforms and formats. “We’re trying to increase our merchandise, trying to increase our location based entertainment offerings, trying to increase our licensees globally and then in addition trying to tell stories around those IP in linear formats either streaming series, theatrical films, that sort of thing,” Justin Scarpone explained.

Expanding Southeast Asian Presence 

SEGA is actively strengthening its foothold in Southeast Asia through various initiatives. “Southeast Asia is a high priority region for SEGA,” Scarpone stated. “That’s why now we have a presence at the Thailand Game Show. That’s why you’ll see more and more retail activations with our IP in places like the Philippines where we have an upcoming pop-up store with SM Mall.”

A notable example is the company’s multi-year partnership with AirAsia, featuring Sonic the Hedgehog and Persona 5 themed aircraft. “The AirAsia opportunity came about through some conversations, about how do we build that sort of out of home visibility,” Scarpone explained.

The company’s partnership strategy is carefully considered: “Companies that are like-minded to SEGA in the sense that they’re always putting the customer first… companies that share that DNA with us are attractive potential partners.” He elaborated on their criteria: “Obviously, we would love for them to be sort of industry leaders or have strong market share so that when we partner, we’re reaching a loyal audience, but also a sizable one.”

Fan Experiences and Addressing Merchandise Accessibility 

SEGA is expanding its fan engagement through themed cafes across Asia. Justin Scarpone emphasized the immersive experience these venues offer: “You go to one of these cafes and you get immersed in the environment that you enjoy from that world. There’s obviously video, there’s the menu, there’s just the overall fandom and being with other fans, like-minded folks to enjoy the environment.

Recognizing the challenges fans face in accessing SEGA merchandise outside Japan, Scarpone detailed their solution: “We’ve established two regional leadership bases, one in the US and one in Japan. From Japan, we’re starting to build out our Asia infrastructure… We have people now in Singapore who are going to drive our Southeast Asia transmedia business.”

“You’re absolutely right. For your part of the world SEGA has not been accessible, nearly accessible enough from a merchandise standpoint,” he acknowledged. “But it’s only this year that we’re really starting to focus on growing this transmedia group within Asia. And we’re making really quick progress. But we also want to get it right. So we’re not going to put out mediocre products into the market. We want to have [an] attractive product and find the right partners.”

Entertainment Content Expansion

SEGA’s transmedia strategy includes significant developments in the core of business of gaming. “We know that we have a product slate for the next five years,” Scarpone revealed. “We’re going to have more content coming in the core business of gaming. And so having trans media strategies for each one of those four IP is just a given.”

Speaking about specific projects, he added: “Shinobi’s got a game coming that we’re developing right now. In the next two to three years you’ll see a lot more Shinobi merchandise, and hopefully experiences at retail as well.” 

Building the Next Generation of Classic IPs 

On reviving classic franchises, Justin Scarpone emphasized the importance of meeting fan expectations: “It just reminds me of what a big obligation we have to deliver and exceed the expectations of those fans. If we’re going to reboot something as a game or as a film, it better be good.”

The company aims to introduce these classics to new audiences: “How do we take all this great IP and make it relevant in new regions, new areas of the world to new demographics, like younger people who might not necessarily know Shinobi, because they’re only 20 years old, right? But how do we get them interested?”

Future Vision and Legacy IPs 

Looking ahead, SEGA plans to introduce a fifth pillar focused on legacy titles. “In the next five years, you’ll see an additional pillar to the SEGA business… the fifth pillar being our legacy titles,” Scarpone explained. “There is as much potential as the number of IPs that Sega has created over its history.”

On team building and future direction, he emphasized: “We want different perspectives. We want creative people. We want passionate gamers. But also we want people who understand branding, brand marketing. We want people to understand the consumer perspective and create businesses around what the consumers want.” 

Justin Scarpone added, “A lot of the people I’m hiring in this office in the US, I’m bringing people in from Universal and Warner and Disney, but I’m also bringing people with game industry background and just trying to mix it up a little bit.”