Target refused to buy figures after the Nemesis / Borg waves.
They sat in vast quantities here.
Enterprise sold horribly for Toys R Us and Target. Wal-Mart never bought any.
The Deluxe (Bridge Sections) did even worse.
AA got the license from Paramount who insisted they start by promoting the new show.
The pattern was to do the series in Chron Order (Ent. TOS, TNG, DS9, Voy).
They started that way: Ent., Nemesis-TNG, TOS, and Worf would be cross-over.
Ent. Series 1 moved slow. Too bad. They were great figures. But the base of fans out there were into traditional Trek. I liked Enterprise, but maybe 1/4 of original Trek fans (now inc. TOS and TNG, possibly DS9) did.
Series 2 was Ent. Away Teams - somewhat to finish crew members that hadn't then been made (Trip, Phlox, Hoshi). Perhaps that should have been the TOS wave right then and there - though many collectors had Playmates figures of these characters, so AA might've thought that would be a gamble since naturally, the first TOS figures should be the crew.
Series 3 was Nemesis due to the movie promo - Picard, Data, Shinzon, Viceroy. Worf and Riker were also anticipated, but the line could have used a Romulan and Reman in generic soldiers, let alone more of the characters like the Romulan female commander, Troi, Crusher, LaForge, etc.
Nemesis was a great movie. It was dark. Perhaps DS9 fans liked that, but general Trek-fluff fans (TNG-sterility) didn't appreciate it (though from sales for First Contact, you'd have thought otherwise). In any case, the figure line was small (4 figures) and more or a follow-up wave would have gotten folks more motivated for it.
Then Target and Toys R Us pulled the funding. They wanted no more to do with Star Trek properties.
To say that it's Trek alone would understate it. In a recent article about Toys R Us and Hasbro posted by SirSteve, it said the chain struggled with Star WARS sales and that one exec said he wouldn't hold all of Hasbro's hopes on the Episode 3 license because he still considered SW a gamble rather than a sure thing (based on E1 sales/overstock problems).
But we'd all agree that from a toy collecting pov, SW is more popular than ST. One of the reasons is the size of the 3 3/4" line. Playmates rocked with ST because they could do so many in the 5 1/4" size and they could make ships and accessories to go with them. I still truly regret the Playmates line ending, as I envisioned getting toys like a BoP for Klingon Figures (way off scale, but so are SW ships like the Falcon). Modern sculpting techniques could have improved the facial detail on Playmates, but the line size was great. A Whole Voyager that had a removeable top to expose a bridge playset (seen in the M. Falcon toy style) would have been great, as would have been the "top half" of a DS9 Station done like the GI Joe Terror Dome, with the lower pylons being cut off but representing "the toy's landing stands."
Trek is not "war-based" as much as DS9 was in general, and totally not as much as SW-CW and then-on is.
However, that is not to say that a bunch of us who like the show and were never as much of a pacifist as Gene Roddenberry wouldn't appreciate army-building war dioramas. I have 11 Jem Hadar and nearly 20 Borgs attacking my Playmates figures. I also used "Kruge" as a generic Klingon and put Gowron in command of an attack squad of them with Worf in armor at his side.
People who collect action figures can be sort of like the Pentagon collecting for an arms race.
Star Trek should have gone there and might be successful if they do, combined with after-school hours syndication - as we all think Trek is better than 3pm cartoons - so why wouldn't other kids watching the Jem Hadar duke it out with the Federation and all that high-tech stuff in Star Trek? TNG held me at that age! I remember, perhaps in error, that when the show started, it was not broadcast at primetime, but came on at like 7pm or earlier, as I had to often tape it because I could still have a baseball game.
Anyway, I wouldn't change Trek. I'd change the marketing and the toy line approach. Perhaps I'd give it a break now, and let Star Wars wind down or attract a TV audience back to sci-fi stuff. But 05 SW stuff is going to be hard to compete with since it's Darth Vader's rise and Anakin's fall.