About Us

Steven Reece We operate a leading Consultancy and Services provider to the Toy and Games industries. Our business is 100% focused on delivering unparalleled insight and services to Toy companies globally. Our services range from consumer insight and board level Consultancy through to helping companies find the right factories, distributors and licenses.

Don’t Forget The Silent Majority…

Posted in Uncategorized on 03 September 2013

Don’t Forget The Silent Majority…

These are incredibly exciting times for the toy industry. Kids tablets are all the rage with several being top selling items in terms of $value.

Skylanders topped a $billion, and Disney’s Infinity looks set to wow.

On top of all this, came the news that Lego Minifigures, a phenomenally successful low price iteration of the Lego brand will have it’s own toy/digital game crossover offering before too long.

These are all huge trends which are in the process of carving out large chunks of the market.

However, one point to note is that while these tech driven phenomenon drive huge sales numbers, there is still a silent majority we’re in danger of forgetting – that is traditional, non-Tech toys.

Traditional play patterns still predominate if we look at the market share by category stats. An obvious example would be Lego again, which while having many exciting new fangled iterations, has at it’s core the same play pattern that’s been engaging and developing kids for decades.

The board games category, for long written off as doomed continues to plug away year after year, some years up, some years down, but still making up a significant chunk of the business.

Vehicles, playsets and dolls continue to own a massive chunk of the market, even if the brands they are based on are being launched via different media than they might have been before.

And above all, children themselves still continue to want to play with both Tech and non Tech toys.

If you had the patience, permission and inclination, and you stacked up all the Tech toys in Toys R Us on one side of the store, and all the non-Tech toys on the other (I’m not including simple voice chips as ‘Tech’), you’d only have just over an aisle full of Tech toys.

There is no doubt based on kids focus groups we’ve conducted recently that kids are loving the LeapPad, Kurio & Innotab, there’s also no doubt that they are loving Skylanders etc., but in every kid’s bedroom these days is an absolute plethora of toys. At least a box full, if not a whole room full.

Our research suggests that children can get anywhere between 6-30 gifts just from other children attending their birthday parties alone, all of which has to be bought, all of which has to be developed, and all of which drives a significant portion of toy business total sales.

And at Christmas and other key periods, kids today don’t just receive the major headline gift, they get many more smaller presents.

So let’s embrace the opportunity, innovation and momentum provided by all this exciting Tech, but let’s not forget the silent majority plugging away year after year, fulfilling children’s play needs with less technology, complexity and lower pricepoints.

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Understanding The Post Global Financial Crisis Toy Industry

Posted in Uncategorized on 15 August 2013

Understanding The Post Global Financial Crisis Toy Industry

Perhaps this post should have started with ‘anticipating’ versus ‘understanding’ the Toy industry post GFC, but I’m an eternal optimist!

For the first time since storm clouds gathered over financial institutions, and thus the rest of us, there are definite green shoots of recovery, and even growth (albeit slow) evident in several major economies of the world.

There is no doubting that we aren’t yet out of the woods, but recent increases in consumer spending, GDP & several other measures in Europe’s big 3 – Germany, France & UK – heralds a definite upturn.

So as we now look to how the toy business will be in this post financial apocalypse, there are certain evident differences pre & post GFC:

1. Dearly departed retailers – there are numerous previously core retailers who didn’t make it. On balance, while this was very painful for all concerned at the time, it seems probable to me that in the longer term the demise of a significant portion of physical retail chains was inevitable.

2. Bricks & Mortars loss was Online’s gain – we’ve all known this upcoming trend was going to become a massive juggernaut at some point, and between the start of the GFC and now, the momentum/market share uplift has been weighty.

3. Slimmer, leaner, meaner Toy companies – the Toy industry is a great place to work. While there is always a ‘sharp’ end of the business, and while there are always risks, hundreds of Toy companies big & small have had to address overstaffing issues, poor commercial practises & general inefficiency, in order to get through the GFC & depressed demand it’s caused.

4. Brands, brands, brands – brands are critical in this industry, and in the last few years this has become even more the case as retailers fall back to ranges/products which they perceive less risk in stocking, and known brands tick all the right boxes there.

5. Broader pricing spectrums – one of the common themes in many Toy companies ranges during these troubled times have been the introduction of more lower priced products, while at the same time, hero priced products i.e. Kids Tablets etc., have also been hugely successful.

6. Licensor consolidation combined with more power to the Toy companies – one company in particular has seen huge gains in this period – Disney’s acquisitions have been staggering, and as demand picks up & as there movie making machine ramps up, we’ll see continued growth for Disney. Aside from Disney’s massively increased leverage, I see a shift in the power balance between content owners & Toy companies, at least partly because so many of the larger Toy companies are now content developers & owners themselves. And for content owners trying to secure new licensing programs, versus the hundreds or thousands of existing proven licenses out there, let me tell you – it ain’t easy!

7. Cost inflation/reduction in competitive advantage of China manufacturers – if we look back to the happy pre GFC days, China ruled the roost. Today, there is no escaping the sheer scale of capacity & expertise in China, but a fair proportion of the cost advantage has been eroded, which shifts back some demand/opportunity to local manufacturers after decades of focus on China. Those Chinese factories who prosper today are those who embrace reliability, quality & customer service above all…many of the factories we work with in our role as sourcing agents have these qualities and so they are succeeding, even prospering, but those also-rans at the bottom of the pile have already fallen by the wayside!

So the Toy industry today is very different to the Toy industry pre GFC, and while there is plenty that hasn’t changed, we shouldn’t presume that it’s just the same old thing all over again.

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Surviving Adversity In The Toy Industry

Posted in Uncategorized on 25 July 2013

Riding The Ups & Downs of The Toy Industry

Anyone who has been in the toy business for longer than a few years has seen their fair share of catastrophes and rock bottom low moments. If you think about it’s actually completely inevitable that we will all at some point reach that point…

…because we work in a hit or miss industry, complicated by safety issues, intellectual property complexities, aggressive competition, an elongated cashflow cycle and many other challenging factors.

For those of us who toil to produce an annual product line, we’re going to have good years when we launch the hits, and bad years when our hard work frustratingly delivers total dogs onto the shelf…this is inevitable if you play the numbers game coming back for another round of fun year after year, selling cycle after selling cycle.

And that’s just the standard level of risk before we look at other complexities.

Speaking as someone who has made multiple $million mistakes in my career I have to say that at times it’s felt like it’s time to go learn how to park cars or mow lawns rather than ride this outrageous roller coaster ride with it’s thrilling ups and it’s gut wrenching downs.

But like all positive people, there comes a time to dust oneself down, analyse and learn what one can from the mishaps, screw ups and twists of misfortune, and then get back on the ride for the next roller coaster ride.

At the time of writing, there have been some (more) notable problems for significant companies in our industry, and so my message to them and anyone else bumping along near the bottom is that this is a long term game, with multiple ‘innings’, so don’t let a bad innings take the wind completely out of your sails…because the tide always flows back, and so it does for good people, good companies and good brands in this industry.

And in the meantime, here’s one of my favourite quotes about living the moment, taking risk and dealing with the grim reality of failure versus a life sat on the sidelines:

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.” Theodore Roosevelt (I think he might have known what he was talking about!).

 

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5 Tips For Finding Reliable Cost Effective Toy Factories

Posted in Uncategorized on 12 July 2013

5 Tips For Finding Reliable Cost Effective Toy Factories

If you look at the P&L of virtually every toy company in the world, there is one cost item which accounts for the highest %age of sales – manufacturing. For most toy companies, manufacturing accounts for between 20-30% of net sales value.

That’s a really hefty chunk of costs!

But what’s surprising is how many non corporate companies fail to maximise the delivery of this critical part of their business. Which is not that surprising in one way, in that creating really cool products & chasing/securing licensing deals is much more exciting for sure, and getting the right product to market can create the difference between winning and losing…

…but so can an efficiently managed Sourcing function!

The challenge for those companies not large enough to have dozens of people working in this area is that normally a small team of one or two people is left to manage a huge amount of burden, especially at key times, in terms of order processing & everything else that goes along with manufacturing.

Management time is normally stretched between too many functions, and so the chance to reduce costs, increase reliability & quality compliance is sometimes missed. So here’s 7 Tips to make a difference to your efforts to find reliable toy manufacturing & good toy factories to work with:

1. If you can’t find new toy factories or board game factories, find someone who can – either ask around your industry colleagues or use a good sourcing agent. We offer a sourcing agency service, so drop us a line if you need help finding good factories.

2. Use factory database services – a good example of this is Alibaba.com.

3. Due Diligence – believe it or not, it’s really easy to find ‘a factory’, what is much harder is to find a reliable toy factory meeting all necessary safety standards and delivering at competitive costs. So once you have a shortlist of factories, you need to go through due diligence. For starters, most factories (rightly or wrongly) will tell you who else they are supplying, so find out who their current customers are, and ask these companies what they think of the toy factory. Beyond that, don’t just take the word of the factory that they meet certain standards, get a copy of the certificate, then check with the authorising authority.

4. Know your stuff – in this internet age, most of the information you can possibly need is online. So don’t let the factory tell you what safety standards you need to meet, find out yourself & interrogate the factory on whether they meet the standard. Check out this link for a list of global toy safety standards http://www.toy-icti.org/info/toysafetystandards.html 

5. Visit the factories – your reputation/business is on the line every time you put product on shelf. Why wouldn’t you visit the factory you are considering using? If you add a factory tour trip onto the end of a trip to HK toy fair you will significantly reduce the risk of any issues.

So that’s just a few quick tips to help you find toy manufacturers and board game manufacturers in China & other markets.

iI you’d like to take advantage of our Sourcing introductions service, please feel free to drop us a line. We are working with around a dozen factories who we know well & highly recommend.

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EducationCity.com partners with Virtual World Licensing & AT New Media for Brand Licensing program

Posted in Uncategorized on 01 July 2013

Please see following press release from our Virtual World Licensing business:

EducationCity.com partners with Virtual World Licensing & AT New Media for Brand Licensing program

EdCity_Ad

London, UK – 1st July 2013 – EducationCity.com, the world’s leading online provider of curriculum driven engaging educational content for schools today announced the start of a new licensing partnership with Virtual World Licensing & AT New Media to roll out consumer-facing educational merchandise and app iterations of the brand globally.

“EducationCity.com is a brand we have been following for some time.” said Steve Reece, CEO, Virtual World Licensing “With its huge installed base and massive metrics, combined with market leading educational content, it’s known and respected by both children and parents, and as such we see a significant commercial opportunity for licensees in multiple categories.”

AT New Media, CEO, Simon Kay said “With EducationCity.com we have a huge opportunity to expand the brand into the consumer world of apps and tablets, to maximise the reach and educational influence of the brand. We’re working to secure industry leading app developers to work with in rolling out the program.”

EducationCity.com can be found at: www.educationcity.com

Since its founding in 1999, EducationCity.com has remained faithful to its commitment to produce unparalleled educational experiences based on highly engaging content and exceptional quality.

Dedicated to creating new ways of delivering curriculum content, recognised with awards by educationalists and adored by children everywhere, EducationCity.com pioneers the evolution of teaching with technology in the new digital learning era. Today, EducationCity.com is used and trusted by over 15,500 schools, including 43% of UK primary schools, with almost 3 million online activities completed each week.

Virtual World Licensing & AT New Media are leading UK based licensing agencies specializing in the world of gaming. With a team of interactive games and licensing experts they represent a growing portfolio of global game brands. Leveraging core brand strengths they create high performing product opportunities that extend virtual brands to the physical world.

“We are proud of the positive impact EducationCity.com has on the educational development of children.” said Richard Whalley, MD, EducationCity Ltd. “We’re now looking to extend this positive impact beyond our core schools market via a program of carefully developed consumer-facing apps & physical products. Virtual World Licensing & AT New Media understand the unique nuances and integral educational credibility of our brand and will ensure that while our reach grows, the robust educational credentials of the brand and its positive educational influence are maintained.”

About EducationCity.com EducationCity.com is a leading developer and publisher of educational content for schools with offices in Rutland, UK, and Dallas and Minneapolis, USA. We employ over 100 people comprising talented artists, programmers, producers, trainers and school support teams. We have a large network of specialist educational advisors spanning the world.

In 2012 generated over £10 million in revenues and continue to invest heavily in both our online services and delivery capabilities. Including additional free product upgrades to maintain our market leading position, and ever greater capacity at our server farms housed in secure, enterprise level data centres in London, Minneapolis and Dallas, ensuring customers continue to enjoy faultless service provision.

For more information, please contact: Steve Reece

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Are You Ready For The Direct To Consumer Revolution That’s Looming For The Toy Industry?

Posted in Uncategorized on 31 May 2013

Are You Ready For The Direct To Consumer Revolution That’s Looming For The Toy Industry?

These are very dangerous times for those with a vested interest in the status quo. The music industry has been revolutionised by digital downloading driven by easy consumer access and online portals versus physical purchase.

For those who remember the resistance from the music industry to the change, perhaps in hindsight we can reflect that they should have taken an ‘If you can’t beat ‘em, join ‘em’ approach.

The book industry has been revolutionsed by Amazon’s Kindle and others. The Home Video industry has been massively affected by the trend towards D2C, cutting out traditional retail.

Just looking at the towering market value of Netflix on the stock market, and their substantial and growing annual profits shows just how much this industry has been changed. So none of this is news.

We all know of these changes, but are you clear on the coming changes for the Toy industry? Or are you wallowing in ‘it will never happen to us’ inertia? Because any business without a D2C strategy in this industry is missing a huge opportunity, and failing to protect their future prospects.

As an industry, we’ve certainly embraced new media in terms of marketing and Brand licensing. Angry Birds et al proves the latter point! However, we really haven’t seen any major players (publicly at least) embrace what is clearly the coming revolution of our industry. And as with all revolutions, new power bases emerge, and old power bases disappear.

The 2 major areas of change are 3d printing and crowd funding.

Now again, everyone knows about these 2 up and coming area, however, it appears to me that many companies have failed to understand the implications.

Just as the book industry power balance was entirely in favour of the publishers who controlled the gateway to retail/commercial opportunity, so the same effectively applies to Toy companies today.

Kindle stripped away the gatweay effect for book publishers.

Will crowd funding and 3d printing do the same to the Toy industry…?

Firstly let’s look at fundamental challenges in our industry:

1. Inventory/justifying MOQs.

2. Limited shelf space/listings at mass retail.

The first issue is a critical point, inventory represents THE biggest risk Toy companies have on an ongoing basis. But in terms of the industry as a whole, inventory risk and MOQs effectively act as barriers to entry into the industry. Combine that with limited mass retail shelf space for our Category, limited number of vendors per retailer and potentially company busting huge orders from some mass retailers, and in effect there is a bottleneck, where those who effectively control product input to retail effectively act as gatekeepers to the industry as a whole – like a dam holding back a huge mass of products pooling up behind the dam.

Anyone who has tried to open a new trading account with Walmart, Carrefour etc will understand my point here!

So here’s the critical point – by allowing (effectively) direct access to consumers 3d printing and crowd sourcing offer ‘dam busting’ opportunity to smaller players, to those with no capital, to those with low engineering/manufacturing understanding and therefore potentially can revolutionise our industry.

Although we might not think it (!), we currently have comparatively few Toys on offer versus App stores/book stores etc. This is because of the sheer risk of developing Toy products in terms of launch risk and financial investment.

BUT if you can use crowd funding to meet initial breakevens on mass produced products and 3d printing to allow more customisation and less need for robust and costly tooling etc., then you have completely changed the game! Suddenly those products that can’t hit a 50k units tooling breakeven become possible. The flood gates will open, which will open the market and lead to huge shifts in what sells and how it sells!

Now by way of perspective, I am not at all suggesting the death of bricks and mortar retail, or that the industry as we know it will fade away. Far from it!

In fact the success factors will remain the same I.e. Brands, innovation and consumer footfall will always win. Toy companies that embrace other technologies will continue to discover opportunity, and mass retailers will continue to sell huge quantities of boxes.

However, take a look at the music, video, video game and book publishing industries and how they’ve been revolutionised in the last decade by D2C digitally driven distribution…

It’s time to make a choice, will you man the barricades and shore up the dam, or will you embrace the considerable opportunities ahead…?

Steve and team

P.S. Have you checked out our new Tele Consultancy service? It offers a budget solution for top level insight! For more details, click here: http://www.stevenreece.com/services/

 

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6 Reasons Why Toy Testing Is Money Well Spent

Posted in Uncategorized on 21 May 2013

6 Reasons Why Toy Testing Is Money Well Spent

The Toy industry invests $billions every year in new product launches (inc. marketing, inventory & R&D costs).

Between 2.3rds & 3/4s, or 66.67% to 75% of Toy skus offered to retail each year are new. Not all are completely new, some are refreshes, tweaks or reintroductions, but nevertheless, a huge amount of what we do is about creating & selling new products. We can logically conclude then that as much as 75% of our output doesn’t work, or at least only works once despite all that work & investment.

There appear to be 2 opposite conclusions we can take from this: Firstly that as so much doesn’t hang around we can just chuck what we like at the wall and see what sticks, knowing full well that we get another chance to start afresh for the next selling cycle. (N.B. this is the approach followed by companies representing in excess of half of the total industry turnover in our opinion/based on our analysis). This approach is not necessarily doomed to failure either by the way, there are plenty of successful companies who do this.

However, there is a 2nd conclusion, and a 2nd approach, which is followed (mostly) by the mighty corporate companies, and less so by the rest. That being that where risk of failure is so high, and where launch risk/investment is so high, reasonable steps should be taken to maximise the chances of success/reduce the risk of launch failure.

Let’s do some quick math(s) here. Let’s presume an R&D/tooling investment of c. $50,000. Let’s factor in reasonable distribution in a couple of markets globally – let’s say 100,000 units for easy math. We’re then looking at c. $200,000 manufacturing cost. Plus let’s presume we have TV advertising to kids in 2 markets in Europe c. $200,000 (min). Plus let’s add in a License advance to the tune of $50,000.

We now have total launch risk of $500,000, on what represents a comparatively small launch versus many out there!

So how many of us would lightly risk throwing away $500,000 in other circumstances – not likely right?!

One of the most obvious ways to reduce launch risk, and to maximise the chances of that $500k+ investment paying back is to test the new products with kids via an expert market researcher & Toy tester (whether our good selves or another company).

Costs for testing toy concepts in a single country begin from as little as $5-10k.

Now at this stage there is no intention to start putting you to sleep with detailed description of Toy testing methodologies, but just as a general point, how does $5-10k invested in reducing launch risk compare with an untested $500k launch investment/risk?

Let’s know look at the ways in which Toy testing with Kids can reduce your risk/increase your chances of success:

1. Toy Testing Normally Identifies Massive Product Mistakes – Our consumers i.e. kids, are rarely that helpful in terms of coming up with practical, usable new ideas. However, they are brilliant at explaining why a product would be readily dismissed as ‘rubbish’ or ‘uncool’ or why it has a fundamental flaw. If your entire product concept is flawed, would you rather than know that before you ship 100,000 units to retailers whose good faith pays your bills, and before you blow the price of a family house on advertising, or are you happy to take the risk!?

2. Tweak, Tweak, Tweak – it’s often the small refinements & changes which make good products great, and give you the chance of a). Building long term Brand equity and b). Selling exactly the same product again next year for much higher profit as you already paid R&D costs!

3. Dexterity Is Key – it astounds us how often Toys which are literally not usable by the target audience are sold into retail in high quantities. If you haven’t tested it, you don’t know for sure, you’re just guessing. And testing with little Johnny whose Dad runs R&D, and who probably has highly developed Toy dexterity due to all the free stuff dad brings home, is not robust enough to test whether the majority of your target market can actually functionally use the product. Can you imagine selling a Vacuum cleaner or Toaster that didn’t suck up dirt or cook toast? Sounds completely ridiculous of course, but you would be surprised how many Toys are just not fit for purpose in some way. Testing dexterity fit pre-launch vastly reduces the risk of wasting the $500k launch investment.

4. A Kids Eye View of the Competition – advertising message & competitive positioning is critical in a very crowded market. Most Toy companies get this, but comparatively few actually test their observations & presumptions with the people whose opinion really matters – the target consumer who you want to buy and use the product.

We have tested adverts which ran on a global basis, whose message literally positioned the product as completely unappealing for the target market i.e. the mesage created by the purportedly ‘Youth’ focused agency was perfect for a teen audience, but totally wrong for 5-7 year old kids who it needed to influence. In that particular instance, the investment in ad production & media spend was in excess of $1 million. If we’d tested it before the spend for a cost of c. $5-10k we could have saved a completely wasted $1m…and that’s before inventory/retail good faith impact.

5. Identifying Opportunity – when we conduct Toy research projects, we do it as Toy industry folk and professional Researchers in equal measure. A great research supplier should be able to identify opportunity for you, but not just pie in the sky stuff like if you increased the spec by 100 times kids would think this was really cool…er really?! Having developed & launched hundreds of Toy products ourselves, we know the trade offs which have to be made, and we know in a practical commercial sense in which direction the opportunities lie. So useful and actionable insight can & will open up completely new opportunities.

6. Increase The Faith – let’s face it, those of us who sell stuff, have products we are really into, and products we ourselves are less convinced by, and of course the people we’re selling to can normally tell how much we believe in what we’re selling. Products which have been validated and improved via research are normally sold with more ‘ooomph’, because everyone within the organisation knows consumers get it, like it & that the product formula has been improved to maximise potential.

Clearly part of this article has been a thinly disguised sales pitch for our own Toy testing services (!), however, whether you choose to work with us, or another research supplier, you really should review your current development process, and the place that Toy testing could play within it!

As outlined above, research projects normally start at $5-10k. If you want to work with us, and are genuinely willing to invest those kind of amounts to reduce your product risk, please feel free to get in touch…

All the best

Steve & team

P.S. We just launched a new service – Toy Industry Consultancy insight via Skype at a rate of £250 / $400 per call. For more details, go to www.stevenreece.com/services

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Space Heroes Universe – A Brand Profile

Posted in Uncategorized on 21 May 2013

For those readers of this Blog who are interested in how newer media formats such as Apps & Virtual Worlds are impacting the toy industry, we’ll share occasional articles from sister site www.VirtualWorldLicensing.com… the following article is a profile on leading virtual world brand Space Heroes Universe, which we are working on currently (extending Brand Licensing program out across EMEA region).

If you’d like to know more about this area, please feel free to get in touch…

Space Heroes Universe – A Brand Profile

Before we (Virtual World Licensing and our partners in this space – AT New Media) agree to work with App, Virtual World or Gaming Brands, we look at the level of ‘Toyetic’ appeal the Brand has, and how easily it will translate into other types of merchandise.

When looking at Space Heroes Universe, our analysis revealed a very high rating for Toyetic appeal & merchandising potential. Space Heroes is one of the most highly toyetic Virtual World brands we’ve looked at.

Once we were assured of this fact we began to investigate the story behind the Brand itself, and it’s a compelling narrative:

  • Created by an award winning developer in Australia.
  • A true multi-media Brand, with Virtual World, Apps, animated cartoons released via digital channels inc. YouTube.
  • A roadmap for development that’s platform-agnostic evolving from a traditional web-based context to a mobile future
  • Available in 15 languages.
  • Strong back story featuring the perennially attractive themes of Space, Heroes & Villains.
  • Strong character universe supporting all major merchandising categories.
  • Ongoing heavyweight marketing campaign.
  • A parent-friendly approach – focused on fun, but considering age-appropriate content,  safety and privacy
  • Massively engaged user base.
  • Opportunity for integrated marketing i.e. promotion of licensed physical products in the online experience.
  • Recognition from kids and parents, having secured Creative Child Magazine’s 2012 Game of the Year as well as the Mom’s Choice Awards Silver Medal and a Parent’s Choice Approved Award.

Based on this heavy hitting Brand story, we’re currently working to rollout Brand Licensing across EMEA for Space Heroes Universe.

To find out more about how acquiring a Space Heroes Universe product license can work for you, please email:

Steve Reece
Simon Kay

 

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8 Characteristics Of Successful Toy People

Posted in Uncategorized on 15 May 2013

8 Characteristics Of Successful Toy People

Have you ever noticed how some people in the Toy industry seem to keep on being successful?

There are some people who just seem to achieve great results/great output on an ongoing basis.

There are reasons for their ongoing success normally. I’ve analysed the most successful people we know or know of in the industry and have come up with the following list of habits/characteristics of those people:

1. Determined and relentless – whether you are a sales person or a creative, a CEO or a marketer, we are all in the business of achieving results. We may have different specific measurables, but in the end we need to achieve positive results. The fundamental characteristic of people who achieve positive results in our industry and others is an inner drive to get the right results, no matter if it’s hard, if it takes months/years or whether our colleagues falter along the way.

2. Great ‘gut’ feel for Toy product – when you look at all the great and the good in our industry, it’s hard to find one without a good feeling for what will sell.

3. Strong emphasis on risk management – at the risk of sounding like someone’s accountant, really need to emphasise the importance of risk management – understanding what the downside is if things go pear shaped is critical to achieving success. Sometimes the best decisions you make in this industry are the products you chose not to launch, as much as the ones you actually did launch!

4. Relationship building focus – there is an inescapable truth in our industry which you can’t avoid. Not that many people move out of it. This is a great industry, so understandably far fewer people leave it than enter it. Therefore if you have the classic ‘hunter’ mentality of making a quick killing in your dealings, you may reap the negative karma for the rest of your career in some cases. To continue the clichéd analogy, if you choose a ‘farming’ approach instead of nurturing and building relationships first, with deals a close 2nd, then you are much more likely to have sustained success. Dump a load of junk on a buyer one year, forget about listings the following year.

5. Use the data – data is a critical component of planning and influencing in this industry. Whether it’s last year’s sales curve, past sales history, advertising spend versus EPOS analysis, product P&Ls or something else, the reality is even the most detached creative minds benefit from understanding the data. At the simplest level if you can’t reach implications about what makes a strong seller via reading sales data, you will struggle.

6. Negotiating and influencing skills – this one comes in towards the end not because it is less important, but more because it is one of the most obvious of the 7. The other half of selling after determination & relentlessness, the ability to positively influence/persuade another human being or organisation to take the action you need is crucial to prolonged success. You might be trying to convince the Walmart buyer to list your product, you may be trying to persuade your company’s management to invest in a product line, you may be selling a concept, but if you can’t influence other people, you won’t achieve good results.

7. Know your strengths & weaknesses, find the right help - one of the advantages of career progression is that the higher you get in an organisation, the more you can structure teams around you to fill the gaps in your abilities & aptitudes. But even if you are a one person operation, the same applies, because you still need a series of relationships/paertnerships to make things happen. First you must be capable of being honest with yourself about what you can and can’t do well, then you find help in the areas you need.

8. There’s nothing as valuable as a post mortem – insanity is purportedly doing the same thing as before while expecting a different result. Herein lies the importance of the post mortem. Human beings generally hate to make mistakes & to fail, especially in view of other people inc. peers/employers. However, the reality is that massive mistakes occur all the time. I’m not going to tell you where I made these mistakes, but I have two $1.5m mistakes on my Resume. Because blowing that kind of money makes you really analyse & investigate where things went wrong. In both of those instances, believe it or not, the mistakes were made for the right reasons. One was comparatively (!) small potatos versus the opportunity and was kind of inevitable if we were to get the big results we got. The second was the wrong product execution for the right reasons. Also in both cases there was a little inward looking organisational delusion, which a post morterm identified, reducing the risk of it happening again.

Some things work in the Toy biz, some things don’t, but we shouldn’t be failing for the same wrong reason time after time.

And so there you have it, my suggestion of the 8 characteristics of successful toy people.

All the best

Steve

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Toy Industry Success Is Formulaic

Posted in Uncategorized on 03 May 2013

Success In The Toy Industry Is Formulaic

Here’s where I raise the hackles of the many gifted creatives and visionaries I have had the pleasure (mostly) and privilege to work with.

Because the more I look at this wonderful toy industry of ours, the more I begin to see clear patterns and clear formula for success.

Let me begin by stating clearly what I am NOT saying. I am not at all saying that creativity is unnecesary or leads to failure – far from it! I’m also not saying that we should all become boring drones.

The reality is that within the boundaries of successful formulae there is massive room & necessity for creativity & expression.

However, where I start to see signs of potential failure ahead for toy companies is when they try to ‘push the boundaries’ or ‘think outside the box’ purely for the sake of doing it. The purpose of everything product & marketing teams do should be to create Toy products that people want to buy & play with. For sure they need to do that in a way which makes their product stand out from the crowd, which makes it more likely retailers will list the products and consumers buy the products, but that’s the ‘how’ not the ‘what’! The ‘what’ i.e. the objective is about delivering commercially successful products.

So here’s the thing – our industry has been around for a lot longer than any of us as individuals have. It’s pretty much all been done before in general terms. We know dinosaurs work, we know heroes & villains works, we know pink & fluffy works, we know building things work as play patterns. So in effect these are known formula. We may call them ‘categories’, but in effect they are just an agreed formula.

To try to create a completely new waying of playing is inherently risky, and inherently likely to fail. I know, I’ve made a career out of working on ‘out there’ projects, some of which we brought home to success, and many more of which fell by the wayside.

The imperative is to deliver formulaic success first…and then, only then to push the boundaries to see what new formula we can create.

Bear in mind by the way, I am not necessarily talking about an R&D focus or an Inventor perspective being driven by formula, I’m talking about the overall business focus. In larger companies this may be non-formulaic R&D pushing boundaries & commercial dullards such as myself selecting the more formulaic ones, in smaller companies it’s an overall thing with management normally.

But please, a sense of perspective. Push some boundaries for sure, and let’s all get excited by truly new stuff, but let’s also churn through the stuff we KNOW will sell as well!

As a final point to end on, think about what we produce from the perspective of our end consumer…every 3 years or so, our existing consumer moves on and a new one takes their place. They have no idea what we did before, only what they like, what is cool to play with and what they therefore want to buy or have bought for them. Above all this is why there are so many perennials in the industry.

So don’t let me stop you being creative, but let’s also create cool stuff that we KNOW will sell!

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