Another component to why the line failed was a serious lack of marketing for the toys. It seems to me that Mattel was being extremely conservative with the line. It really didn't get a very big "push" compared to other major movie lines. It came out at a somewhat odd time (after the summer but before Christmas, and about two months before the film hit), and when it was first hitting shelves most people had no clue what it was.

It seemed like by the time the movie actually hit the retailers had already pegged the line as a failure and Mattel had all but written it off. Of course it didn't help that almost every "named" character in the film had a figure made in the first assortments. There wasn't much room for expansion beyond re-releasing new versions of the same characters. Though some "RDA Trooper" and "Na'vi Warrior" troop builders might have been a good idea.

Personally, I think Mattel just sucks at action figure marketing. They're capable of making good product (DCUC, MOTUC) but incapable of successfully pushing them. Maybe they're too content to rest on their Barbie and Hot Wheels laurels.

I think some blame needs to go on the retailers. They think every movie tie in line is somehow going to be the next Star Wars so they put pressure on the toy manufacturers for a ton of movie related items.

Doesn't matter how many times retailers have to clearance off movie related items they have to have more and more on the off chance this time they fly off the shelf like Star Wars figures. And they seem to have a horrible habit of overstocking wave 1 to really make sure a line has the best chance at failure.

Perhaps the toy manufactures have figured out movie stuff doesn't sell as well so they stopped putting as much effort into movie toys so they could focus on the toys that sell without a movie.

I think the primary issue with the failure of this line was because the toys themselves failed too. People have brought up DCUC and MOTUC as quality Mattel lines, and their WWE line is great too(I casually collect it and enjoy it much), but Mattel also has some lackluster lines like DCIH. The Avatar figures are closer to DCIH than the other aforementioned toylines.

People will buy quality toys irregardless of it the movie sucks or not. IMHO, the movie was great, but the toys were not.

Here is the bottom line for me: the line was almost unappealing.

It is a simple answer that needs a little more explanation. A friend bought a few figures for his son (They were super cheat at a Family Dollar), so I got to see and play around with a few of them.

The toys themselves are not bad. I found them to be sturdy and well put together. The thing I noticed was that they all really just looked alike. I couldn't tell one blue guy from another blue guy. There was no real distinction between the characters. Avatar Jake Sulley figure looked like every other blue guy.

Another thing that was bad was the packaging. No matter what, people do want to see what they are buying. I can imagine the MOC collectors stayed away because it's really just a box. Also the box looks like it could have cookies or snacks in it more than a toy.

There are more reasons, but I think these two were the biggest.

They did everything wrong save scale!

Scale was correct because it allowed them to make affordable vehicles. But other than that.... terrible. sculpts didnt look like characters, Navu are cool due to articulation(like spider man) so a brick figure is useless which is what they were, didnt capture likenesses, no cool accessories, insane price point, crappy packaging, basically everything was off.