In my game, when an enemy takes damage, his material flashes red. This works fine for one guy, but when multiple enemies appear and one takes damage, they all flash red, because the animation plays for them all. Is there any way to make them have unique material animations?
So Grenzer, your problem might be that you’re animating the material diffuse color. Which makes the whole material go one color, and any object with that material will go to that color when the animation is played.
Instead, you should use Object Color, And animate the Objects color according to the material. I’ve made a video to explain what I’ve just said!
Hope I’ve helped! 
Oh. Good to know.
I was tryinv to decide whether to use diffuse color or object color as a driver for a material shader a while ago and couldnt see more benefit either way. I didnt think about the possibility that diffuse color may be replicated across different characters with the same material.