'Sneak king' peaking: equity marketing strikes gold with video games for burger king promotion.

WHAT began as a standard promotional campaign for a fast-food giant has turned into a small pop culture phenomenon--and provided a major financial boost for Burger King.

Equity Marketing, a unit of L.A.-based Emak Worldwide Inc., created three video games designed for use on Microsoft's Xbox stations. "PocketBike Racer," "Big Bumpin" and "Sneak King" are sold for $3.99 with a value meal from Burger King. The games are edgy--the ubiquitous stone-faced Burger King character stars in "Sneak King"--and funny.

They became an instant success for the chain; during the two months the promotion ran, the games sold more than 3.2 million copies in Burger Kings across the United States and Canada. Earlier this month, Burger King executives credited the game sales for a 40 percent boost in the company's second quarter earnings.

"It's funny to watch, funny to play--it's just hilarious," said Equity co-chief executive Jon Banks from his offices on the Westside. "You are taking this eating experience and making it into a gaming opportunity. Obviously the user can't get away from Burger King messaging, because it is the game."

The quirky success story is good news for Equity's parent, Emak, whose fortunes have foundered in recent years. The company, traded on the Nasdaq, went public in 1994, the same year it moved its headquarters to Los Angeles from New York to help capitalize on its entertainment industry ties.

Company executives became concerned in the late 1990s that the firm was becoming too dependent on Burger King, a 19-year client of Equity, which at times made up as much as 80 percent of the parent company's revenues. To provide another source of revenues, Emak moved into the promotional toy business. It was a logical extension, since Equity had already begun developing toys for Burger King.

Over the years, the company ended up securing a number of entertainment licenses. Equity produced kids' toys for characters including Warner Bros.' Scooby-Doo, Disney's Kim Possible, Jim Henson's Bear in the Big Blue House and the Powerpuff Girls; the licenses expired in 2005. None had the success of the Burger King video games.

Emak's net income hit nearly $8 million in 2003, but the company racked up losses of $9.7 million in 2004 and $39.9 million in 2005. The stock is now trading around $5 a share, down from its $16-range peak in 2003, and saw a slide late last month after former chief executive Donald Kurz sold more than 6,600 shares. Kurz once owned about 28 percent of the company's common stock and was engaged in a proxy fight over the board of directors with current CEO Jim Holbrook in early 2006.

Industry buzz

Equity and Burger King decided to do three games so that there would be an entry in each of the most popular gaming genres: action-adventure, racing and a head-to-head battling game. The British firm Blitz Games developed the titles, which may have contributed to the international notoriety surrounding the games.

"The games have made a big stir in the industry," Blitz' John Jarvis told a gaming Web site this month, "and to see (British) magazines like Edge and GamesTM picking up on them--despite their availability in North America only--is an indication of how well they are doing." Sneak King, the action adventure title, was the most offbeat of the three. The other two games have more depth and characters like viral star Subservient Chicken and former E! Entertainment host Brooke Burke.

In "Sneak King," the player assumes the role of the King character from Burger King TV ads. The virtual King creeps up on citizens of a kingdom and feeds them fast food by stealth, at times by hiding in trash cans. If the citizens see the King approaching, they lose their appetite; if the King is successful, he does a bizarre victory dance.

"It felt really, really niche, and we weren't sure if people would get it," Banks said of Sneak King. "There were countless hours of conference calls and e-mails about the game, its viability and how many games to make."

News of the games' development--a rush job by Blitz by any video game standards at just 8 months--leaked out to Gawker Media's Kotaku.com more than 6 months before the debut and helped build buzz ahead of the games' release.

ANNE RILEY-KATZ

Staff Reporter