TOTY 2017: CAST YOUR VOTE FOR TOY OF THE YEAR
KEEPINâ€™ IT CRAFTY: HOW ACTIVITY TOYS INSPIRE CREATIVITY
KIDS ARE FLIPPING OUT OVER SEQUINS
DECEMBER/JANUARY 2018 Volume 33, No. 6 — Published by Adventure Publishing Group
Jonathan Samet Publisher firstname.lastname@example.org Jackie Breyer Editor-in-Chief email@example.com
10 Talking Social Media
11 Sweet Suite & HoliDAY of Play 12 ASTRA’s Insights
70 WIT Stories 73 Industry Marketplace
74 Flashback: 13 Toy Association Update December/January 1998 66 Outside the Box
A Guide to the Nominees for the Toy of the Year Awards
51 Why Independent Brick & Mortar Stores Are Here to Stay
72 10 Crowdfunding Tips
JP Stoops discusses what makes a successful crowdfunding campaign in the toy category.
42 What’s New in Arts & Crafts
Classic, screentime-free play reigns supreme in the activities category.
Rubie’s EVP discusses last Halloween’s successes and his predictions for 2018.
Stephanie Grassullo Assistant Editor firstname.lastname@example.org
Joe Ibraham Art Director email@example.com Bill Reese Production Director firstname.lastname@example.org
Kelly Corbett Editorial Intern
52 Kids Are Flipping Out Over Sequins
U.S. Corporate Headquarters
A look at how sequined products are making waves in the toy industry
Laurie Schacht President email@example.com Adventure Publishing Group, Inc.® 307 7th Avenue, #1601, New York, NY 10001 Phone: (212) 575-4510 • Fax: (212) 575-4521
54 Are You Ready for Your Close Up? Wendy Smolen shares tips on prepping for success in your Toy Fair meetings.
THE RUBIE’s INSIDER: 55 58 Q&A with Howard Beige
Maddie Michalik Associate Editor firstname.lastname@example.org
Lori Rubin Controller/Office Manager email@example.com
The annual trade fair debuts 2018 toy trends and what’s in store at this year’s show.
Harve Light’s predictions on how Toys “R” Us’ bankruptcy will have a ripple effect on the entire supply chain
Ali Mierzejewski Senior Editor firstname.lastname@example.org
Jacqueline Cucco Editorial Assistant email@example.com
34 Spielwarenmesse 2018
40 Big Box Holiday Cheer to Be Lacking in 2017
Marissa DiBartolo Senior Editor firstname.lastname@example.org
Kristen Nelson Assistant Editor email@example.com
features 14 TOTY Awards
62 Product Preview: Rubie’s Costume Co.
Snowman Pet Costume, by Rubie’s Pet Shop Boutique
63 Product Preview: Rubie’s Pet Shop Boutique
64 Product Preview: Imagine By Rubie’s
The Toy Book Volume 33, No. 6 THE TOY BOOK (ISSN-0885-3991) is published bimonthly by Adventure Publishing Group, Inc.® Editorial and advertising offices are located at 307 Seventh Ave., Room 1601, New York, NY 10001, Phone (212) 575-4510. Periodicals Postage paid at New York and additional mailing offices. Copyright © 2018 Adventure Publishing Group, Inc.® All rights reserved. No part of this publication may be reproduced or transmitted in any form, or by any means, electronic or mechanical, including photocopy, recording, or any information storage and retrieval system, without written permission from the publisher. Printed in U.S.A. Subscription rates: $48 one year, foreign $200. The Toy Book is a trademark of Adventure Publishing Group, Inc.® Registered in the U.S. Patent & Trademark Office. Postmaster: Send address changes to: The Toy Book, c/o Adventure Publishing Group, 307 Seventh Ave., Room 1601, New York, NY 10001. Opinions and comments expressed in this publication by editors, contributing writers, or solicited or unsolicited documents are not necessarily those of the management of The Toy Book.
Member, International Toy Magazine Association On the Cover: Antsy Pants, by Beach House Group
HAPPY NEW YEAR FROM THE TOY BOOK! by JACKIE BREYER, editor-in-chief AS I WRITE THIS ON December 15, my mind keeps drifting to the fact that I have not yet finished my Christmas shopping. That’s right; I’m one of those consumers who has a pretty good idea of what I need to get, but hasn’t quite had the time to make it happen. Maybe I’m procrastinating while I think up the absolute perfect gifts for my family and friends. Regardless of the reason, I’m contributing to that “last-minute-shopper” syndrome that perhaps makes retailers a little crazy. Of course, I did have a heads up about the hard-tofind toys, so the kids in my life will still get their squishy toys, Pikimi Pops, and Fingerlings. Collectibles were the star of the show in 2017, and I expect that their popularity will continue next year. Collectibles—particularly blind bags and surprise packs—grew tremendously over the past two years. According to The NPD Group, collectibles earned $1.4 billion January through October, and now represent 11 percent of all U.S. toy sales. Blind packs were up 60 percent January through October year over year. Additionally, the top five selling toys overall for the month of October have the word “Surprise” in their names (a variation of L.O.L. Surprise and Hatchimals Surprise SKUs). Journalists asked me over and over again throughout this year, “Why?” “Why are collectibles so popular? They seem so simple.” The reason is multi-fold. First of all, yes, they’re simple. They’re straightforward enough that their appeal has a very broad reach. Thanks to YouTube, everyone knows about them. Endless numbers of videos of kids unboxing, unwrapping, and showing off their various collectibles each have thou-
© 2018 Jonny Hawkins
sands—some of them millions—of views. This kind of viral marketing is unstoppable and something many manufacturers dream of, but few see in reality. Collectibles are also affordable, so in many cases kids can buy them with their allowance. They’re small enough for kids to bring to school and trade duplicates with friends, and in many cases they’re just plain fun to reveal and cute to collect and play with. Another trend we’re seeing right now is the sequin-flipping trend. It started with Mermaid Pillows and continues to expand to other kids’ items, such as bracelets, notebooks, and apparel. Check out our coverage of this cool trend on page 52. Also in this issue, we took a look at what’s new in arts and crafts activities. This is a classic category that will never fade away. Kids will
always need an outlet to express their creativity and there are many new items coming to shelves in 2018 that will expand kids’ opportunities to be artistic. Check it out on page 42. Lastly, have you placed your votes for The Toy Association’s Toy of the Year awards? We’ve got the full TOTY ballot inside this issue, beginning on page 14. Take a look at all of the amazing nominees, and then visit toyawards.org and vote carefully! » Jackie Breyer is editor-in-chief of The Toy Book and the Toy Insider, and editorial director at Adventure Publishing. She has been reporting on new products and toy industry trends for 15 years. Contact her at firstname.lastname@example.org.
toybook.com | DECEMBER/JANUARY 2018 | THE TOY BOOK 7
Toy Industry Growth&Decline by Country
Source: The NPD Group/Retail Tracking Service, Jan.-Oct. 2017
Arts & Crafts U.S. Performance by Subclass (Jan.-Oct. 2017) Dollars
Dollars % Change
YTD (Jan.-Oct. 2017)
YTD (Jan.-Oct. 2017)
Arts & Crafts Grand Total
Powered Appliance & Food Mix
Top-Selling Arts & Crafts Items in U.S. for the Month of October 2017 Item Description
L.O.L Surprise! Fizz Factory
Play-Doh Classic Colors Theme Assortment
Play Doh Single Tub
Easy Bake Ultimate Oven Baking Star Play Set
Powered Appliance & Food Mix
Oonies Inflator Season 1 Starter Pack
Lite Brite Magic Screen Retro Style
Model Magic White Air Dry Clay 4oz
Play-Doh Super Color Pack
Play-Doh Mini Buckets Assortment
Etch Sketch Freestyle Assortment
Source: The NPD Group/Retail Tracking Service
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BASIC FUN! LAUNCHES CAKE POP CUTIES WEB SERIES Following the release of Poopeez, Basic Fun! will launch its second animated web series—for Cake Pop Cuties—in advance of the global toy launch early next year. Created in collaboration with Brandberry, Cake Pop Cuties was designed to be a mix of popular trends including cake pops, blind reveal toys, and slow-rise foam. Basic Fun! partnered with Executive Producer Matt Wexler of Wexworks Media, who enlisted Little Blackstone Studios. The series of short animations follows the Cuties in a dessert-filled world. Cake Pop Cuties’ collectible toy line will be available globally at retail in January, and the first series of slow-rise characters will be sold in blind capsules resembling cake pops and multipacks. The webisodes launched on Dec. 13. »
TOY ASSOCIATION NAMES HALL OF FAME INDUCTEES The Toy Association will induct Andrea Barthello, co-founder and chief operating officer of ThinkFun Inc.; Stan Lee, former editor-in-chief, publisher, and chairman of Marvel Comics; and the late James R. Becker, founder of licensing company Anjar Co., into the Toy Industry Hall of Fame. These individuals were selected for induction by members of The Toy Association in recognition of their contributions to the industry and the impact they have had on the lives of kids through a lifelong commitment to toys and play. They will join a roster of 74 toy industry luminaries, including Jim Henson and George Lucas, who have been inducted into the Hall since it was established in 1984. The 2018 ceremony honoring the latest inductees will take place at the 18th Annual Toy of the Year (TOTY) Awards on Friday evening, February 16, at the Ziegfeld Ballroom (formerly Ziegfeld Theater) in New York City. The ceremony will kick off the 115th North American International Toy Fair. »
WIT ANNOUNCES 2018 WONDER WOMEN GALA AWARD HONOREES Women in Toys, Licensing and Entertainment (WIT) announced honorees for its annual Wonder Women Awards Gala,
which celebrates industry leaders for their outstanding contributions in toys, licensing, and entertainment. WIT will induct Lifetime Achievement Honoree, Norma Rosenhain, Creata CEO, and the Elise Lachowyn Mentorship Award will be given to Nancy Zwiers, executive vice president (EVP) and global chief marketing officer (CMO) for Spin Master. The 14th Wonder Women Gala will take place on February 18 and will celebrate Wonder Women honorees and finalists in the following categories: Creator/Innovator; Licensing; Manufacturing; Marketing; Public Relations; Retailer; Sales; and Rising Star. WIT will also recognize the Toys “R” Us President of Play, 11-year-old Ariana Gentry, with the Wonder Girl Award. The WIT Foundation Scholarship program will present seven scholarships to student recipients at related toy, engineering, and licensing industry-focused programs at universities worldwide. »
JAZWARES DEBUTS ROBLOX CELEBRITY COLLECTION Jazwares Introduced the Roblox Celebrity Collection of action figure toys, available exclusively online and in stores at Walmart. This new collection is inspired by Roblox developers and is designed to integrate with the full line of Roblox action figures for kids. The Roblox Celebrity Collection includes game packs and play sets from top games
on the platform, including “Top Roblox Runway Model,” “Neverland Lagoon,” and more. Each toy includes a code for a unique virtual item that can be added to a player’s wardrobe on Roblox. The new Celebrity Collection will be supported by a comprehensive marketing campaign including events, in-store promotion, and digital promotion. Jazwares will support the line with special holiday events in December at Walmart stores in Florida and Tennessee featuring giveaways, downloads, photo opportunities, and more.
DISGUISE, MGA TO LAUNCH L.O.L. SURPRISE! COSTUMES Disguise Inc. and MGA Entertainment entered a multi-year licensing agreement to design and manufacture children’s Halloween and dress-up costumes and accessories based on the L.O.L. Surprise! characters. The line will feature tiaras, shoes, jewelry, wands, wigs, and bag sets. The collection will launch next year in North America. L.O.L. Surprise! collectibles feature layers of unboxing and surprises. The collection currently features more than 120 dolls, with new additions to launch next year. »
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TALKING SOCIAL MEDIA
FIVE KEY MISTAKES BRANDS MAKE WHEN WORKING WITH INFLUENCERS by MELISSA HUNTER, founder, Family Video Network INFLUENCER MARKETING IS ONE OF THE best ways to connect with consumers and inform them about your brand and products. Lots of companies are leveraging this key medium, but not all companies are doing it right. As you prepare for your next influencer activation, be sure to avoid these five easyto-make mistakes. CHOOSING INFLUENCERS BY THE NUMBERS Many searches for influencers start by looking at view counts, subscribers, or followers, and choosing those with numbers that are in the millions. This is certainly a quick and easy way to choose an influencer, but is it the right way to choose the person or people who will continue to be associated with your brand after your planned integration ends? You need to be careful with whom you entrust your brand. While numbers need to be considered, your search should start with looking for influencers who have content that is similar in tone, attitude, and values to your brand. Take the extra time to look at each influencer’s content to make sure that they are safe representatives for your brand. Also, check out branded content they already produce. How well do they convey a brand’s message? Does their branded content stick out like a sore thumb among their standard fare? What type of response does their branded content get from their audience? Nothing is worse than working on an influencer campaign that provides no actual influence with your target audience. BEING A CONTROL FREAK Choosing an influencer because you love their style, voice, and level of professionalism, and then micromanaging the entire integration is a total waste of your time and theirs. At the outset of your engagement with an influencer, clearly communicate your messaging and what you want to ultimately achieve through the integration. If there are critical talking points that you need the influencer to communicate, let them know what those are. If there are specific phrases or terminology that you need to have conveyed,
clarify that. But then step back and let them do their thing! Do not present them with a brief that is actually a script, or ask them to make excessive edits to their content. Influencers are not actors, they are creators, so let them be creative. Let them present you with their vision for how best to share your product and messaging with their audience. Remember that it is their audience. Allowing influencers to take the lead and express themselves will result in a strong relationship and, most importantly, you will have an integration that yields the best results. THROWING PRODUCT AND MONEY OUT THE WINDOW You may have obtained a mailing list of influencers, briefly looked through their content, and decided that several of them might be a good match for your brand. You pack up your product and ship it off to those influencers and await the flood of coverage, only to become disappointed when you receive a trickle of coverage. Before you start shipping product to influencers, you need to contact them to make sure it is something they want to feature. Otherwise, you have absolutely no idea if your product is of any interest to them, or if they require monetary compensation. They might even have a production schedule that doesn’t line up with your promotional timeline. From the influencer perspective, nothing is more frustrating than receiving something out of the blue with no context. Your time, budget, and products are valuable. Sending unrequested product to influencers is the equivalent of throwing money out the window. While reaching out to creators may seem like more work, in the end you will have a way better campaign and it will all be worth the effort. GETTING STUCK IN LONG-DISTANCE RELATIONSHIPS Long-distance romances often fail because they lose their spark. Similarly, working with influencers using generic email templates coupled with shipments of
10 THE TOY BOOK | DECEMBER/JANUARY 2018 | toybook.com
new product on a regular schedule yields content that feels sterile and lacks a certain spark. Consumers respond positively to that spark—that true love between a creator and a brand or product—and they often gloss over content that feels rote and sterile. While you may not ever get the opportunity to meet all of your influencers in person, there is a device called the telephone, which can yield amazing results. Having conversations over the phone gives you the opportunity to connect with your influencer partners. As you get to know them and they get to know you, their content becomes more authentic and heartfelt, and consumers will sense that. EMBARKING ON A JOURNEY WITH NO DESTINATION Many influencer campaigns begin because “we need to start using influencers!” Lists are developed, products are sent out, communication takes place, content is created, and then… what? You need a clear idea of what you want to accomplish. Are you trying to raise awareness of a new product, increase sales, or grow your own social media footprint? Choose a specific goal for one activation. While you may show gains in multiple measurable areas, having a specific goal in mind will help you hone your influencer strategy skills. Influencer marketing is a marathon, not a sprint, and it will traverse all types of terrain over the years. Avoiding these five most common mistakes will help you to create long-term partnerships with influencers and together you can navigate the twists and turns successfully. »
Melissa Hunter is better known in the YouTube world as Mommy, the co-host of Mommy and Gracie Show, which she shares with her 14-year-old daughter, Gracie. In 2014, she launched Family Video Network, an influencer consulting company that works with the top toy brands and social media personalities in the kids and family space.
SWEET SUITE & HOLIDAY OF PLAY: THE BEST WAY TO REACH INFLUENCERS & PRESS ON JULY 11, THE TOY BOOK AND THE TOY INSIDER WILL HOST the ninth annual Sweet Suite event, known as the BIGGEST Night of Play, at Pier Sixty in New York City. The event will welcome more than 250 digital influencers, 150 members of traditional press, and 80 toy brands to meet face-to-face and get hands-on with the hottest toys and games of the season. Guests will enjoy delicious food and cocktails, all while getting a first look at new product reveals and making new industry connections. Last year at Sweet Suite, guests enjoyed one-on-one time with representatives from more than 80 of the hottest kids’ brands and properties on the market, including VTech, LeapFrog, Just Play, Warner Bros. Interactive Entertainment, Spin Master, Mattel, Simplay3, MGA Entertainment, K’NEX, LEGO, and more. For the second year in a row, Sweet Suite will partner with top YouTube creators to bring Sweet Suite Live—a livestream of toy unboxings—to the event floor. Top sponsors will create custom boxes for YouTubers to open live on camera in the special Sweet Suite lounge, while thousands of followers watch the fun from home. Last year, channels such as Mommy and Gracie Show, That YouTube Family, Little Lavignes, Kitties Mama, Kid Toy Testers, and more participated in the fun. Enormous swag boxes will also be shipped directly to attendees’ homes after the event, sparking a resurgence in social media impressions and ensuring influencers and journalists have products
on-hand to review and share with their followers. Want to make a BIG impression at Sweet Suite 2018? Platinum and Title sponsors are invited to host their own private events on July 10, the morning of July 11, or July 12. Throw a party for select groups of influencers, theme the experience toward a new brand or product launch, or just get to know top-tier influencers in a more intimate environment! What you do is up to you; we’ll provide the influencers, promos, pre-event support, and more! All special events will be coordinated by Melissa Hunter of Family Video Network and Mommy and Gracie Show. In September, The Toy Book and Toy Insider team will host the seventh annual HoliDAY of Play event in New York City, where members of the media will be the first to see the Toy Insider’s Hot 20, Top Tech 12, and STEM 10 hot holiday toy picks, as well as meet with top manufacturers just before the holiday season. This one-of-a-kind cocktail party will welcome traditional press, top lifestyle bloggers, and YouTube personalities to engage with sponsors and experience the top holiday toys. Just in time for a firstlook at the hottest holiday toys, HoliDAY of Play is a great place to show off new products and be a part of the first round of holiday shopping coverage. » If you’re interested in learning more about these events, contact Laurie Schacht at email@example.com.
toybook.com | DECEMBER/JANUARY 2018 | THE TOY BOOK 11
Scott Friedland and Kimberly Mosley appear on TV on behalf of the American Specialty Toy Retail Association to promote Neighborhood Toy Store Day and the Best Toys for Kids Awards.
DELIVERING THE INDEPENDENT STORE MESSAGE: What to Say During Media Interviews
by KIMBERLY MOSLEY, president, American Specialty Toy Retailing Association I RECENTLY MADE A TV APPEARANCE ON behalf of the American Specialty Toy Retailing Association (ASTRA) with member Scott Friedland, owner of Timeless Toys located in Chicago. We promoted Neighborhood Toy Store Day and the Best Toys for Kids Awards program to generate media coverage that supports ASTRA retailers. It was time well spent early on a Saturday morning. Few of us could call ourselves experts at media interviews—whether for print, radio, blogs, live TV, or social media—yet there’s no denying that doing them helps a business grow. My personal rule is that I never turn down a legitimate opportunity to make toy buyers aware of why independent toy stores are worth checking out. I’ve done enough interviews to share with you how I prep to effectively deliver my message. These are some basics I always remind myself of before an interview: • Keep answers short and simple. • No need to cover a topic thoroughly; it’s better to say something quotable. • Be clear about the one big idea you want to communicate. I call that the “money line.” • It’s OK to deliver the money line before answering the reporter’s question. PRACTICE MAKES PERFECT As Scott and I worked on our messaging before the interview, our reason for carting a
big box of toys to a TV studio on a cold Chicago morning was to set apart independent toy stores from mass-market discounters and online retailers. We would reach parents and others with holiday shopping on their minds, and we had to remind them of the locally owned toy store right in their community. If you find the clip, you can be the judge of how we did—amateurs that we are! The point is, we had a strategy and we practiced. THE SPECIALTY TOY DIFFERENCE Here are examples of lines that deliver the message about the specialty toy difference: • “In my store, it’s not about what a toy can do; it’s about what the child can do with the toy.” • “In my store, our job is to help find a fit between the child and the toy. We know toys inside out. You may even say we know more about toys than anyone else in this town or city, so we can help you find the right toy.” • “If you want a battery-operated gizmo, razzmatazz kind of toy, you’ll need to go to a big-box discount store or online. In this store, we are more interested in the features of play, not the features of the toy.” • “We are proud of the play value of our toys. Kids will play with them over and over, and then younger siblings and cousins will too—and maybe even their kids. You won’t find our toys broken on the bottom of the toy box two days after they are opened.”
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• ”When you shop here, more of your dollar stays right here in our community and supports our local economy. I own this store, not stockholders who have never been here. I am committed to this community.” Whether you talk about your business’ philosophy and products, or the importance of shopping local, all of these messages boil down to the same thing: Check us out. We are different, and you will like the difference. As we set up the toys before we went live, we made small talk with the talent and crew about the specialty toy difference. The meteorologist immediately connected with the STEM toys we brought as ideas for his two daughters. One of the anchors talked about her—not specialty—toy store experience as a child, not far from where Scott’s store is today. When we went live, I was proud to hear Scott say his money line on air. “In my store,” he said, “it’s not about what the toy can do, it’s about what the child can do. It’s about finding the right product for that child.” »
Kimberly Mosley, president of the American Specialty Toy Retailing Association, is an experienced, award-winning, results-oriented association executive with a long track record of success in managing association operations, developing innovative programs, and growing revenue.
TOY ASSOCIATION UPDATE
COUNTDOWN TO TOY FAIR by KRISTIN MORENCY GOLDMAN, communications specialist, The Toy Association THE TOY ASSOCIATION IS PLANNING A jam-packed marketplace for global toy and play professionals attending the 115th North American International Toy Fair this February. “Every attendee—from brand owners and buyers to distributors and manufacturers—should start planning early so they can squeeze in everything Toy Fair has to offer,” says Marian Bossard, executive vice president of global market events, The Toy Association. “With less than three months to go, we’re gearing up for an exciting show filled with deal-making, networking, after-hours events, and educational opportunities, all of which are designed to help our guests grow their businesses and expand their horizons.” For the first time, the majority of Toy Fair’s educational programming will be free for all registered Toy Fair attendees. “This includes our stellar licensing track and sessions geared to independent retailers and entrepreneurs,” adds Bossard. “We’re looking forward to making this invaluable content even more accessible to our audience.” The official show website, toyfairny.com, is continually updated with new information about seminars, special events, registration, and more. Below are a few highlights: JUST FOR BUYERS Approximately 1,000 exhibiting toy companies from six continents will showcase their toy lines to buyers and trade guests. The Launch Pad area in Hall 1E will exclusively feature first-time exhibitors that are new to Toy Fair, offering a rare glimpse at never-before-seen product. In total, the hottest trends in play and youth entertainment will be on display across more than 440,000 net square feet at the Jacob K. Javits Convention Center, from the latest tech to beloved classics. This year, Toy Fair will launch a new freshman buyer orientation program for first-time buyers to help them navigate the vast show floor and hone in on products and trends that will attract the attention of shoppers. Retailers can get a head start on scouting product by visiting shoptoys365.com. The digital marketplace allows toy companies to showcase their products in virtual showrooms, and enables buyers to discover new playthings for
their stores. Retailers interested in learning more about shoptoys365.com can contact Scott Evans at firstname.lastname@example.org. TREND-SPOTTING Global buyers and media are invited to The Toy Association’s annual Toy Trends Briefing, which will take place on the second day of the show. During the seminar, the Association’s trend experts will unveil their top trend predictions for the coming year using product examples from the floor. Top trends spotted at last year’s Toy Fair included active toys, classic playthings, educational toys with a robotic twist, and tech toys. Collectibles were another smash hit— and went on to become one of the year’s hottest categories, with global sales for collectibles growing 15 percent for the first half of 2017, according to The NPD Group. “In 2018, we are expecting to see a new crop of exciting and innovative playthings that are truly engaging and entertaining, whether they are tech-driven or unplugged,” says Adrienne Appell, trend expert at The Toy Association. “And with so many nostalgic millennial parents now shopping for children of their own, there will likely be a spike in demand for retro toys that were popular in the ‘80s and ‘90s.” GROW YOUR BUSINESS A vital component of The Toy Association’s year-round Knowledge Network, Toy Fair’s educational programming will include several annual favorites: • For the first time, The Toy Association’s Licensing Content Connection will be free for all Toy Fair attendees. Presented in partnership with the Licensing Industry Merchandisers’ Association (LIMA) and UBM, the five-session program will provide key insights into the world of licensed playthings, from 101 tips for beginners to licensing trends. • The Toy Association will host a series of Global Trade and Market Expansion presentations designed to help toy companies consider whether France and Germany are possible new export markets. Presenters will provide key findings from Toy Association-commissioned research on these
markets, including demographics; social, economic, and geographic trends; toy industry growth and product category demand; and much more. The sessions are free for Toy Association members; $99 for non-members. • There will be free Independent Thinking sessions, hosted for the first time in partnership with the American Specialty Toy Retailing Association (ASTRA), to provide independent and specialty toy retailers with tools to grow their businesses and attract shoppers to their stores. • Toy Fair’s learning series, Creative Factor, will offer inventors, designers, and other creative types a show-long schedule of complimentary seminars about starting a business, negotiating agreements, protecting intellectual property, and more. • The free Toy Safety & Compliance Update will provide global manufacturers and retailers with key information and news regarding U.S. and international toy safety standards and regulations. ALL WORK AND NO PLAY? NO WAY! Show organizers scheduled special events and after-hours activities for Toy Fair guests, including an International Welcome Reception to help global buyers and other attendees forge new connections. Other activities will take place throughout Toy Fair week, including the Toy of the Year (TOTY) Awards gala and the Women in Toys Awards. Up-tothe-minute details are available on the Toy Fair website. The 115th North American International Toy Fair will take place Feb. 17 to 20 at the Jacob K. Javits Convention Center in New York City. Visit toyfairny.com for up-to-theminute show news and information—or download the Toy Fair Mobile app. » As The Toy Association’s communications specialist and editor of its Toy News Tuesday e-newsletter, Kristin Morency Goldman stays abreast of the latest economic data; safety standards; trends; and toy-, play-, and youth entertainment-related news.
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THE TOY ASSOCIATION unveiled the toy, game, and license finalists for the prestigious 2018 Toy of the Year (TOTY) Awards. Known as “the Oscars of the toy industry,” the TOTY Awards program supports kids in need by serving as a critical fundraiser for the Toy Industry Foundation. Between now and January 5, consumers can visit ToyAwards.org to vote for their favorite picks in each of the 17 categories—including new categories for this year, such as Creative Toy of the Year, Playset of the Year, and Plush of the Year. The 122 finalists were announced at an exclusive press event that helped kick off the second annual Play Fair in New York City. “Each and every one of the TOTY finalists have brought joy, laughter, and learning to children around the world. From classic board games to innovative tech toys, these playthings represent the best of the best in the world of toys and games,” said Steve Pasierb, The Toy Association’s president & CEO, at the event. “The TOTY Awards program supports the Toy Industry Foundation’s work to deliver toys to millions of children in need—
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whether they are living in foster care, impoverished, recovering in hospitals from a traumatic illness, or facing other difficulties,” added Pasierb. This year’s finalists were selected from more than 600 nominees submitted by more than 150 companies of all sizes. Twenty judges, including toy and play experts, retailers, academics, and journalists, reviewed and ranked the products in specific categories relevant to their areas of expertise. The judges then participated in a live discussion to determine the finalists in each category. They considered each product’s creativity, design, play value, and marketing. There will be one winner in each category, as well as the coveted “Toy of the Year” award winner and the “People’s Choice” winner (based solely on consumer votes), which will be announced at the TOTY Awards gala on Friday, February 16, at the Ziegfeld Ballroom (formerly known as the Ziegfeld Theater) in New York City. The celebration will kick off the 115th North American International Toy Fair, and will include the induction of toy industry trailblazers into the Toy Industry Hall of Fame. »
VEHICLE OF THE YEAR
NOMINEES INCLUDE: ««
AIR HOGS HYPER DRIFT DRONE (SPIN MASTER)
ANKI OVERDRIVE: FAST & FURIOUS EDITION (ANKI)
AUTOMOBLOX SC1 CHAOS AND HR5 SCORCH 2-PACK (PLAYMONSTER)
DRONE FORCE ANGLER ATTACK (ALPHA GROUP)
NERF NITRO MOTOFURY RAPID RALLY SET (HASBRO)
PAW PATROL SEA PATROLLER (SPIN MASTER)
PLAYMOBIL GHOSTBUSTERS ECTO-1 (PLAYMOBIL)
Drone Force Angler Attack
Paw Patrol Sea Patroller
COLLECTIBLE OF THE YEAR
NOMINEES INCLUDE: ««
DISNEY•PIXAR CARS 3 DIECAST CARS (MATTEL)
FUNKO'S MYSTERY MINIS (FUNKO)
HATCHIMALS COLLEGGTIBLES 4 PACK (SPIN MASTER)
L.O.L. SURPRISE! (MGA ENTERTAINMENT)
PIKMI POP! SURPRISE PACK (MOOSE TOYS)
THE LEGO BATMAN MOVIE MINIFIGURES (LEGO)
16 THE TOY BOOK | DECEMBER/JANUARY 2018 | toybook.com
PRESCHOOL TOY OF THE YEAR NOMINEES INCLUDE: ««
BEAT BUGS MUSICAL SUBMARINE (BLIP TOYS)
DISNEY JUNIOR DOC MCSTUFFINS ALL-IN-ONE NURSERY (JUST PLAY)
PAW PATROL MY SIZE LOOKOUT TOWER (SPIN MASTER)
PLAY-DOH MAGIC OVEN SET (HASBRO)
RACING ADVENTURES MICKEY (JUST PLAY)
SCOOP & LEARN ICE CREAM CART (LEAPFROG)
THOMAS & FRIENDS SUPER STATION (MATTEL)
Disney Junior Doc McStuffins All-in-One Nursery
INFANT/TODDLER TOY OF THE YEAR NOMINEES INCLUDE: ««
GEARZOOZ ROLL & ROAR ANIMAL TRAIN (VTECH)
LITTLE TIKES LIGHT 'N GO 3-IN-1 SPORTS ZONE (MGA ENTERTAINMENT)
MAGFORMERS MY FIRST PASTEL 30PC SET (MAGFORMERS)
MEGA BLOKS ELEPHANT PARADE (MATTEL)
MIRARI SHELLBY (PLAYMONSTER)
POP-A-BALLS PUSH & POP BULLDOZER (VTECH)
STROLLY BIKE (YVOLUTION)
TEDDY RUXPIN (WICKED COOL TOYS)
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Strolly Bike Pop-Balls Push & Pop Bulldozer
SPECIALTY TOY OF THE YEAR NOMINEES INCLUDE: ««
AMERICAN GIRL LOGAN DOLL (MATTEL)
CREATIVE COSMETICS LAB (THAMES & KOSMOS)
FIDGET SPINNER (TOPTRENZ)
HEXBUG CUDDLEBOTS (HEXBUG)
LEGO STAR WARS MILLENNIUM FALCON (LEGO)
MIRARI JUBALLEES (PLAYMONSTER)
SMARTMAX MY FIRST ANIMAL TRAIN (SMART TOYS AND GAMES)
ZIPES SPEED PIPES (NEAT-OH! INTERNATIONAL)
PLAYSET TOY OF THE YEAR
Ben 10 Rustbucket Transforming Alien Playset
NOMINEES INCLUDE: ««
BEN 10 RUSTBUCKET TRANSFORMING ALIEN PLAYSET (PLAYMATES TOYS)
FISHER-PRICE SHIMMER AND SHINE MAGICAL LIGHT-UP GENIE PALACE (MATTEL)
GO! GO! SMART WHEELS RACE & PLAY ADVENTURE PARK (VTECH)
HEXBUG NANO SPACE COSMIC COMMAND (HEXBUG)
HOT WHEELS SUPER ULTIMATE GARAGE (MATTEL)
MY FAIRY GARDEN MAGICAL COTTAGE (PLAYMONSTER)
PLAYMOBIL PHARAOH'S PYRAMID (PLAYMOBIL)
SHOPKINS SHOPVILLE SUPER MALL (MOOSE TOYS)
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Hexbug Nano Space Cosmic Command
PLUSH OF THE YEAR
NOMINEES INCLUDE: ««
DISNEY JUNIOR MINNIE'S WALK AND PLAY PUPPY (JUST PLAY)
DOLCE ACTIVITY ZEBRA (MAGFORMERS)
FUNKO'S SUPERCUTE PLUSHIES (FUNKO)
PEPPY PETS (COMMONWEALTH TOY & NOVELTY CO.)
PIKMI POPS SURPRISE! MEGA POP (MOOSE TOYS)
STORYTIME RHYMES SHEEP (VTECH)
SURPRIZAMALS (BEVERLY HILLS TEDDYBEAR)
Disney Junior Minnie’s Walk and Play Puppy
CONSTRUCTION TOY OF THE YEAR NOMINEES INCLUDE: ««
K'NEX THRILL RIDES: WEB WEAVER ROLLER COASTER BUILDING SET (K'NEX BRANDS)
LEGO STAR WARS BB-8 (LEGO)
MAGFORMERS LOG CABIN 87PC SET (MAGFORMERS)
MAYKA TOY BLOCK TAPE (ZURU)
MECCANO M.A.X. (SPIN MASTER)
SILENT MARY (LEGO)
VEX ROBOTICS BATTLEBOTS MINOTAUR (HEXBUG)
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Magformers Log Cabin 87Pc Set
TOY OF THE YEAR NOMINEES INCLUDE: ««
CIRCUIT CUBES (CIRCUIT CUBES)
CUE (WONDER WORKSHOP)
LEGO BOOST CREATIVE TOOLBOX (LEGO)
PIPER COMPUTER KIT (PIPER)
ROBOTICS WORKSHOP (THAMES & KOSMOS)
CREATIVE TOY OF THE YEAR NOMINEES INCLUDE: ««
3DOODLER START POWERPUFF YOURSELF PEN SET (3DOODLER)
K'NEX IMAGINE: POWER & PLAY 50 MODEL MOTORIZED BUILDING SET (K'NEX BRANDS)
LEGO MAKE YOUR OWN MOVIE (KLUTZ)
NICKELODEON SLIME DELUXE SLIMY CREATIONS (CRA-Z-ART)
OONIES STARTER PACK (MOOSE TOYS)
STAR WARS DROID INVENTOR KIT (LITTLEBITS)
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GAME OF THE YEAR
NOMINEES INCLUDE: ««
BEASTS OF BALANCE (SENSIBLE OBJECT)
BOOM BLAST STIX (MOOSE TOYS)
HAPPY SALMON (NORTH STAR GAMES)
HEARING THINGS (HASBRO)
ROLLER COASTER CHALLENGE (THINKFUN)
SOGGY DOGGY (SPIN MASTER)
ULTRA DASH (PLAYMONSTER)
OUTDOOR TOY OF THE YEAR NOMINEES INCLUDE: ««
BUNCH O BALLOONS FILLER SOAKER (ZURU)
DISC JOCK-E (TUCKER TOYS)
LUKE SKYWALKER'S LANDSPEEDER (RADIO FLYER)
NERF N-STRIKE ELITE ACCUSTRIKE ALPHAHAWK BLASTER (HASBRO)
SKY VIPER V2450 GPS STREAMING VIDEO DRONE (SKYROCKET)
WATERMELON BALL (PLASMART)
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ROOKIE OF THE YEAR
NOMINEES INCLUDE: smART Sketcher
ANTSY PANTS BUILD & PLAY KITS «« (BEACH HOUSE GROUP) ««
CIRCUIT CONDUCTOR (PAI TECHNOLOGY)
FUZZY FLYERS (MOVE2PLAY)
HISTORY MAKERS PUZZLE BLOCK SET (BEVY & DAVE)
OPERATION: ESCAPE (YULU TOYS)
SMART SKETCHER (FLYCATCHER)
COMPOUND KINGS MAKIN’ STATION (WECOOL)
Antsy Pants Build & Play Kits
DOLL OF THE YEAR
NOMINEES INCLUDE: ««
BABY ALIVE SWEET TEARS BABY DOLL (HASBRO)
BARBIE FASHIONISTA KEN DOLLS (MATTEL)
DISNEY PRINCESS DANCE CODE BELLE (HASBRO)
DREAMWORKS SPIRIT RIDING FREE SPIRIT & LUCKY DELUXE FEEDING SET (JUST PLAY)
JOJO SIWA SINGING DOLL (JUST PLAY)
LUVABELLA (SPIN MASTER)
WONDER CREW SUPERHERO WILL (PLAYMONSTER)
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JoJo Siwa Singing Doll
ACTION FIGURE OF THE YEAR
NOMINEES INCLUDE: ««
IAMELEMENTAL'S SERIES 2/WISDOM LUNCH BOX CARRYING CASE WITH COMPLETE SET OF 7 ACTION FIGURES & ACCESSORIES (IAMELEMENTAL)
IMAGINEXT DC SUPER FRIENDS BATBOT XTREME (MATTEL)
MARVEL GUARDIANS OF THE GALAXY DANCING GROOT FIGURE (HASBRO)
PJ MASKS DUET FIGURE PACKS (JUST PLAY)
STAR WARS FORCES OF DESTINY ADVENTURE FIGURES (HASBRO)
WWE SUPERSTARS ACTION FIGURES (MATTEL)
INNOVATIVE TOY OF THE YEAR NOMINEES INCLUDE: ««
DROPMIX MUSIC GAMING SYSTEM (HASBRO)
HEXBUG BATTLEBOTS ARENA (HEXBUG)
HOT WHEELS MINDRACERS (OSMO)
KLASK (BUFFALO GAMES)
LIGHTSEEKERS STARTER PACK (TOMY INTERNATIONAL)
RUBIE’S JURASSIC WORLD T-REX INFLATABLE COSTUME (RUBIE’S COSTUME CO.)
THINK & LEARN TEACH 'N TAG MOVI (MATTEL)
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Lighsteekers Starter Pack
Rubie's Jurassic World T-Rex Inflatable Costume
LICENSE OF THE YEAR
NOMINEES INCLUDE: ««
DISNEY•PIXAR'S CARS 3 (DISNEY CONSUMER PRODUCTS & INTERACTIVE MEDIA)
STAR WARS (DISNEY CONSUMER PRODUCTS & INTERACTIVE MEDIA)
NICKELODEON SLIME (NICKELODEON CONSUMER PRODUCTS)
HATCHIMALS (SPIN MASTER)
PAW PATROL (SPIN MASTER)
PEPPA PIG (ENTERTAINMENT ONE)
PJ MASKS (ENTERTAINMENT ONE)
PJ Masks Rival Racers Track Playset
Peppa Pig Lights 'N Sounds Family Home
Paw Patrol Lookout Tower
Star Wars Force Link BB-8 2-in-1 Mega Playset
LICENSE TO PLAY
SPECIALTY SPIELWARENMESSE TOYS & GIFTS
by ERNST KICK, CEO, Spielwarenmesse eG IF THERE’S ONE AREA THAT’S GAINING national traction in the global toy industry, it’s licensing. According to figures released by Euromonitor International, licensed product sales are expected to grow by 14 percent from 2017 to 2020, and are likely to smash the U.S. $26B barrier somewhere in the notoo-distant future. The success of a toy license depends on a variety of factors. First, it’s crucial to note that not every property will work in every country. There are significant regional differences when it comes to consumer awareness of a property, as well as preferences that impact how a product is interpreted—simple or stylish, to zany and colorful.
TRUST IN “OLD FAVORITES” Second, a license may be a major money spinner in Asia, but have no impact at all in North America or Europe, and vice versa. The biggest chances of breaking into the international arena are held by licenses that have already made a name for themselves and products that immediately draw the consumer to them. Beloved characters that have been around for decades are currently experiencing a surge in popularity. Parents and grandparents place their trust in “old favorites” that trigger their own childhood memories, demonstrating how licensed properties are successfully spanning the generations. The adult collectibles market, where Star Wars boldly leads the way, should not be underestimated either. As sequels and related series continue to hit the big and small screens at regular intervals, the associated product ranges continue to grow along with the target groups they address. This is helped by the rapid spread of digital technologies. Tablets, smartphones, and laptops allow us to constantly indulge in a wide media offering, featuring our favorite characters and a host of budding new stars. THE POWER OF THE CINEMA Sometimes it isn’t always the license that comes first, but a product that is subsequently developed into an entire entertainment
brand. This is a route that a growing number of toy manufacturers have recently chosen. Hasbro in particular has had a pioneering role here by creating its own studios, with successes that include Transformers and My Little Pony, which simultaneously fuel demand for the classic product ranges. Next year, Mattel will follow suit with Barbie, bringing the world’s most famous doll to cinema screens in a live-action movie. Additionally, the industry anticipates the sequel to Frozen with bated breath, as the long wait has not affected its standing as the most successful license for girls. Likewise, Disney, Warner Bros., DreamWorks, Universal, and other media companies help the licensing business continue to thrive.
licensees. Retailers and buyers at this year’s Spielwarenmesse will bump into this and many other popular national and international licensing stars. Companies of all sizes and across all product groups will present strong licenses, bringing the full force of this industry to the forefront in Nuremberg. »
A TV SERIES LEAP OF FAITH While cinematic adventures and heroes tend to move in international circles, characters from TV series usually take on the role of local patriots. Even so, they still have a chance to break out and make it big beyond their national borders. A recent example of this is the Russian computer-animated series Masha and the Bear, which has gradually made its way into other European countries. Yet, it doesn’t always have to play out on the big stage. In Germany, Pummeleinhorn (The Chubby Unicorn) is currently attracting a growing circle of
• Extensive range of presentation options for licensors and agencies
Licensing at the 69th Spielwarenmesse • Licensing across all product groups • Continued cooperation with the International Licensing Industry Merchandisers’ Association (LIMA); Stand: Foyer Hall 12.0
License Guide: spielwarenmesse.de/licenseguide Ernst Kick was appointed as the CEO of Spielwarenmesse eG in 2003. He has decades of experience in business, marketing, and exhibition organization.
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SPIELWARENMESSE 2018 The annual trade fair debuts 2018 toy trends and what’s in store for this year’s show, taking place from Jan. 31 to Feb. 4 in Nuremberg. SPIELWARENMESSE ANNOUNCES 2018 TOY TRENDS Spielwarenmesse’s 10-member TrendCommittee identified the following three trends for the coming year: Explore Nature, Team Spirit, and Just for Fun. The TrendGallery at Spielwarenmesse brings the trends to life, offering trade visitors the chance to experience them first hand along with products that reflect these toy trend themes.
EXPLORE NATURE: DISCOVERING THE WORLD OF FLORA AND FAUNA Kids pay little attention to nature, with a large integral of their time spent on computers and smartphones or in front of the TV screen. Yet, there is so much for them to explore outside, and physical activity helps kids enjoy a healthy and balanced lifestyle. The Explore Nature trend brings kids closer to nature, encouraging them to step outside and discover everything there is to
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learn from the outdoors. Products that fall within this trend include magnifying glasses and binoculars that send curious kids on expeditions, or planting sets that turn them into little gardeners. TEAM SPIRIT: STRIDING TOWARD VICTORY TOGETHER Now, more than ever, team spirit plays an important role in all aspects of society and among all ages groups, and stresses the
SPIELWARENMESSE values of cooperation, social interaction, and flexibility. Products that reflect team spirit help kids to solve problems together. In order to work together, communication is key, and kids will have to learn to listen to the opinions of others and reach compromises. Victory is only possible within the group. JUST FOR FUN: GAMES WITH A FUN FACTOR During playtime, it’s important to remember one thing: It has to be fun. Learning is a natural part of play, but it does not always have to be at the forefront. The Just for Fun trend places the emphasis on fun and on playing as an end in itself. Products that capture this trend often have simple rules that can also be adapted and modified with a little imagination. Played in a group or alone, they are usually spontaneous and quick to complete. At the same time, skill and dexterity are often required. DISCOVERING NEW PRODUCTS IN THE TRENDGALLERY Everyone wants to know what will shape the toy market of tomorrow. Hall 3A is a must-stop destination at Spielwarenmesse and is an important hub for all trade visitors. It is here that visitors will find the TrendGallery, presentations with expert talks, and the
ToyAwards. The TrendGallery is the perfect place to discover these trends and the innovations emerging in the toy industry. Prior to the show, 10 members of the international TrendCommittee—comprising of market researchers, trend experts, and journalists—scout the major toy markets of the world in search of the most important industry trends. “The right timing is really important,” says Christian Ulrich, director of marketing of Spielwarenmesse. “We tend to go for trends that haven’t yet taken hold in the marketplace, but have already been embraced by the first few innovative toy makers. A trend can only be considered suitable if it has a high impact and enough momentum to spread.” At the show, trade visitors can visit this area to experience this year’s trends, which are presented together with related products. Also featured in this more than 10,000square-foot space are the innovations and winners of the ToyAwards.
TOY BUSINESS FORUM: CONCENTRATED BUSINESS KNOWLEDGE Useful and insightful knowledge about trade and industry is neatly packaged into the special presentations that take place at the Toy Business Forum, which spotlights a different overarching theme every day. Discovering trends is only half of the battle. Individuals have to be able to effectively communicate these trends to consumers at the retail level. The professional talks at the Toy Business Forum deliver hands-on concepts and ideas, featuring a different topic every day to provide specialist retailers with relevant knowledge. The presentation arena and the TrendGallery will appear in a new design at Spielwarenmesse 2018. For further information about the highlights and innovations at Spielwarenmesse 2018, visit spielwarenmesse.de/ highlights. »
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BIG BOX HOLIDAY CHEER TO BE LACKING IN 2017 Toys “R” Us Filing Will Have Ripple Effect On Entire Supply Chain
by HARVE LIGHT, managing director, Conway MacKenzie EVERYONE IS TALKING ABOUT THE STATE of the retail industry and the seismic changes that it is undergoing. Hardly a week goes by that another retailer hasn’t filed for bankruptcy protection. If they aren’t already, lenders and suppliers should monitor their exposure closely. Often lost in the flurry of activity surrounding a large bankruptcy is the effect a bankrupt retailer can have on the rest of the supply chain. We call this the ripple effect. These bankruptcies have profound short- and long-term effects on working capital and financing arrangements for the entire supply chain. The most recent example is the Toys “R” Us bankruptcy filing. While not a complete surprise, it sent shockwaves throughout the supply chain. More than 100,000 creditors are now scrambling to determine the effect it will have on the all-important upcoming holiday season and beyond. The immediate impact will likely cause several of them to seek bankruptcy protection, as they are now likely facing working capital challenges themselves. Most lenders immediately classify accounts receivable from customers in bankruptcy as ineligible because of the low probability of collection. This can have a tremendous impact on a company’s borrowing power. For the smaller suppliers this usually leads to an “out of formula” situation and a default under the loan agreement. This impact is not limited to product suppliers. It can also affect service providers, such as trucking and logistics companies. Collectibility of Toys “R” Us accounts receivable is only the first wave of the impact for direct suppliers. There will likely be a significant impact on inventory. Suppliers may not want to take the risk of selling product to the company given the payment risk. In this particular case, there are likely other potential buyers of the inventory, such as Amazon, Walmart, or Target. Unfortunately,
it’s a strong bet that gross margins will suffer with the big guys. In other cases, the inventory may be customer specific. ABL lenders will implement additional reserves against this inventory or they may make it ineligible all together. This leads to more pronounced liquidity issues. The abrupt loss of borrowing power and liquidity can lead to an immediate crisis for unprepared small and middle market companies. One of the most common situations is the inability to make a company’s most important payment: payroll. Because payroll occurs on such a frequent basis, management does not have time to react. In most instances, lenders will accommodate. The price will be heavy in terms of interest rate, fees, and additional controls. The second most common situation is with the supplier’s trade creditors. It is very likely that one of them, usually a critical one, was monitoring the larger picture and has a good idea of the impact it has had on its customer. Credit terms are tightened, if not moved to COD. Either one of these situations can be a death knell for the company. And while some companies may be able to survive this initial barrage, the challenges are just beginning. The loss of liquidity will continue to work its way through the company’s cash cycle. Whether or not the supplier was able to withstand the initial loss and continue meeting its payroll and supplier requirements, liquidity has been lost. The supplier also has to pay the rent, and equipment leases, and service its bank debt. It is likely that the company used the cash flow available to make these payments to pay employees or calm squeaky creditors. Beyond these fixed payments, profitability is likely to decline as the company will eventually have to write-off uncollectible accounts receivable and obsolete inventory. This usually leads to covenant defaults within loan agreements. Finally, if management can-
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not replace enough of the lost revenue, it can result in missed forecasts, which also lead to covenant defaults. The preceding scenario focused on first level suppliers. While it is unlikely the impact will be as severe, the ripple effect continues to their suppliers, landlords, and service providers. A great example of this effect occurred during the Great Recession and the bankruptcy filings of GM and Chrysler. It was a unique phenomenon because these companies were so large, but the ripple effect was very relevant. It went as far as the companies that cleaned second level supplier facilities. And while there is a low probability such events will happen in the auto industry again, it will happen in other industries. The domestic energy complex went through a similar downturn just a few years ago. MITIGATING RISK These situations are often unexpected, but there are three best practices that both lenders and companies can put in place to mitigate their impact: quantification, monitoring, and communication. Each sounds pretty simple, but it is amazing how many times lenders and management are surprised by the bankruptcy of a large customer. In the case of Toys “R” Us, there was widespread speculation well before they filed for bankruptcy, but it still caught many off guard. If these best practices were in place, the impact would be somewhat mitigated. Let’s look at each best practice in more detail. The first best practice is quantification. It is important to know what exposure a company has to a particular customer. There is tremendous risk in having a concentration of revenue from a single source. It is a reality that many small companies get their start or become bigger companies because of a single customer. It should be a primary goal of the business to mitigate this risk. One of the
ways to accomplish this goal is to diversify the customer base. It takes time, but diversification should be a part of any long-term plan. In the interim, companies should monitor their leverage closely and avoid significant debt, keeping the company well capitalized. This provides dry powder for weathering a storm. This is appropriate for more than just the first level supplier. Second level suppliers should know who their customer’s customers are. The second best practice is monitoring. Once exposures are quantified, it is important to have processes in place to monitor it. This means putting credit limits in place. It also means keeping up with how customers are performing. If they are public, their financial statements should be examined each quarter. Monitoring newsfeeds for stories related to them is also important. This has the added benefit of informing a supplier of new contracts that could positively affect its operations. Monitoring also includes analyzing the
impact of a negative event. What will happen to your borrowing base if your customer files for bankruptcy? Knowing the impact ahead of time allows for faster, rational reactions. The last best practice is communication. Companies and their lenders need to be talking about these situations before a crisis occurs. Each party will benefit from the insights of these conversations. Companies will gain information about what their lender sees at other companies in the same situation. Lenders will be alerted to a potential situation that they may not have known about. As a bank workout officer, it was much easier for me to make accommodations when I knew a situation was on the horizon, rather than learning about it on a Friday afternoon when employees were waiting for their paychecks. It was also less costly for the company because I knew the company’s management understood the situation and its impact. The retail industry is going through tough times, but it is not the first industry to experi-
ence change—and it definitely won’t be the last. The best practices described work in any industry. Companies that implement them will minimize the frustration and sleepless nights that come with such crises. The end goal: Survive to fight another day. » While working with suppliers and manufacturers, Harve Light noticed a pattern of behavior that is detrimental and all-too-prevalent in middle-market manufacturing. He specializes in providing strategic and in-depth services, including crisis management, strategic planning, financial analysis, and big data analytics. He was with a national bank’s restructuring department for decades. Light worked with hundreds of middle-market companies and several private equity firms across a wide range of industries throughout North America, including financial, real estate, technology, automotive, and retail and consumer products.
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by LAURIE CHARTORYNSKY, communications specialist/content developer, The Toy Association THE ARTS AND CRAFTS CATEGORY experienced positive sales growth since the end of summer—aided in part by trend-driven products on store shelves, including reusable compounds and mechanical/digital design crafting kits, according to analysts in the toy industry. “Crafts are a great activity for families and friends to bond through during the holiday season,” says Adrienne Appell, trend expert at The Toy Association. “And with the myriad of fun and engaging craft activities available for holiday and coming in the new year, toymakers are giving kids plenty of opportunity to tap into their imaginations.” The category is also getting a boost from its perceived educational value. Engaging in an arts and crafts activity encourages kids to focus on creative play and gives them an avenue to explore their ideas, however unique. Learning how to tap into this skill at an early age will help kids think outside the box and come up with creative solutions to challenges they may face later in life. “Today’s millennial parent wants their child doing more things,” says Neil Friedman, CEO of Alex Brands, adding that the company’s products “let the child express their imagination and their own creativity and not really confine them.” THE NUMBERS AT A GLANCE Over the three-month period between August and October, sales in the arts and crafts category rose 1 percent, compared to the same period in 2016, despite falling
2 percent in the January to October 2017 period, according to The NPD Group. Juli Lennett, NPD’s senior vice president and industry analyst for U.S. toys division, says new and innovative products, retro items that are resonating with a new generation of kids, and tried and true arts and crafts activities are all helping sales in the category. Arts and crafts offer a classic play pattern, but “there are some great new products out there,” says Lennett. Kids “are just looking for something that is fun to do and, in the case of arts and crafts, has a good outcome. I think that’s why slime did so well.” According to NPD, the top five selling new arts and crafts products during the latest three-month period include: L.O.L. Surprise! Fizz Factory (MGA Entertainment), Oonies Inflator Starter Pack (Moose Toys), Lite-Brite Retro Style Magic Screen (Basic Fun), Beados Teeneez Style’n Go Designer Studio Set (Moose Toys), and Play-Doh Kitchen Creations Magical Oven (Hasbro). Specifically, the mechanical/digital design category rose 11 percent in the August to October period compared to a year ago, helped by the Etch A Sketch (in addition to the classic version, Spin Master introduced two new versions—Etch A Sketch Freestyle and Etch A Sketch Joystick—in July), and Basic Fun’s Lite-Brite. Reusable compounds saw 4 percent growth in the same comparable period, with products like Playfoam (Educational Insights), Crayola Silly Putty and Modeling Clay, and Play-Doh Royal Salon Featuring Disney Prin-
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cess Rapunzel (Hasbro) contributing to the recent growth, according to Lennett. NOW TRENDING “People are making a concerted effort to enjoy screen-free time in order to create physical products and embrace the creative process that goes into the making,” says Sheila Wright, president of Ann Williams Group, a Bloomfield, Mich.-based manufacturer known for its Loopdedoo, Loopdeloom, and Craft-tastic yarn and string art kits. “Making with family and making for others is trending because it’s a way to connect, which people are craving right now.” A satisfying end-product is also important in any craft because it “leads to the collectibility [aspect],” Alex Brand’s Friedman says. “If they’re happy with the end results then they [will] want to do another one and another one.” Social media also plays an important role in the popularity of crafts. Kids want to not only share their creations on social media, but also look to YouTube to see how a craft
is done before trying it themselves—another reason why slime became so big. (NPD tracks standalone slime in miscellaneous toys; make-your-own slime kits are tracked in craft kits.) “Kids were sharing [slime] on Instagram,” says Lennett. “Kids [were] watching what other kids were doing on YouTube and wanted to do it as well.” To capitalize on the social aspect of arts and crafts, Alex Brands recently partnered with YouTube sensation Crafty Carol, part of Driver Digital’s YouTube Cool School channel. Crafty Carol demonstrates how kids can create imaginative arts and crafts projects and will showcase new Alex products, including Sweetlings, Happy Little Loom, Knot-a-Craft, Rock Pets, and more. CLASSIC ACTIVITIES STILL REIGN Still, classic artistic products that continue to be popular with kids year after year should not be discounted. “We have a number of evergreen products that we update with content and packaging in order to keep them fresh and current,” says Ann Williams’ Wright. Toys, such as the Loopdeloom, “are evergreen because they are really great products, both in how you make [them] and what you end up with. The fresh spin introduces a trending or updated look.”
Most importantly though, a good craft needs to be fun. “If they’re not fun then they become a chore,” Friedman notes. The Toy Association tracks trends on a yearround basis to provide the toy industry with insight into what’s new and what’s on the horizon in the toy and youth entertainment product industry. New trends will be announced for 2018 at the 115th North American International Toy Fair, taking place February 17 to 20 at the Jacob K. Javits Convention Center in New York City. Visit toyfairny.com to learn more. » Laurie Chartorynsky has been a member of The Toy Association’s communications team since September 2016. She is responsible for the weekly e-newsletter, Toy News Tuesday, and writes articles based on the latest trends in the toy industry for trade publications. Laurie has a Master’s degree in Journalism from Northwestern University.
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MOOSE TOYS will expand its Beados line in the spring with Beados Teeneez Series 2 Theme Pack—Enchanted Dream Catcher. Kids can create a dream catcher with detailed designs using 500 mini Beados Teeneez beads. Kids can follow the design, place the beads on the template, spray with water, and let their creation dry and fuse together. Moose will also add new theme packs to its line of Oonies craft kits.
Developed by FLYCATCHER, smART sketcher allows kids ages 5 and up to transform photos taken from their smart devices into a sketch. By using the free smART sketcher app, photos are filtered and transferred via Bluetooth to the projector. Instantly, users will see their desired image projected onto paper. Users are able to draw anything the eye can see with just a touch of a button. The smART sketcher also comes with pre-loaded micro SD cards that are filled with a variety of activities, including step-by-step drawings, learn-to-write letters and numbers, early spelling skills, and more. Additional SD cards can be purchased separately to keep the creative learning going.
Yummy Nummies, BLIP TO YS’ line of no-bake mini coo king kits, expands next year with the Cake Push Pops Maker. Kid s age s6 and up can place the war m vanilla cakes into the pus h pop, and layer with colorful, creamy frosting between each cak e. The Cake Push Pops kit includes eve rything kids need to get mix ing in the kitchen, including three cak e push pops, batter, frosting , mixing trays, and more. All of the food ingredients are made in the U.S., and no oven is required to make the sweet treats.
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Invented in 1895, Plasticine is the original reusable, non-drying modeling compound. This year, KAHOOTZ TOYS brings back the creative compound that never dries out. Kids ages 5 and up can choose from a 6-Color Pack, 9-Color Pack, 24-Color Rainbow Play Pack, or the Plasticine Tool Kit, which includes five shape cutters, a sculpting tool, and more. Easy to work with, Plasticine doesn’t stick to hands, stays soft, and is perfect for stop-motion Claymation videos. Kids can bring their Plasticine creat ions to life using Stop-Motion Studio, a free app that allows for easy animation.
CRAYOLA’s Crayola Rock Painting Kit includes everything kids need to turn ordinary rocks into amazing works of art, including six acrylic paints, glaze, brushes, metallic markers, and more. Kids can find their own rocks, and then design them with doodles or quotes. Then, they can share creations with friends, or hide them around the neighborhood for strangers to find and re-hide—a popular new trend.
Designed for kids ages 8 and up, MINDWARE’s Paint Your Own Expressions set features three activities in one. Kids can paint their own unique designs on high-quality porcelain letters to create statement pieces for any room, including WISH, LOVE and PEACE. Each kit includes five pieces of porcelain, 12 paints, and two brushes. Kids can paint, bake, and display.
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THAMES & KOSMOS’ I DIG IT! DINOS are excavation kits with scientifically accurate models and educational manuals that teach kids about paleontology. Kids ages 7 and up can play the role of fossil hunter and go on their own real-life paleontological dig using the hammer and chisel. Kids will discover skeleton reliefs, fossilized dinosaurs, and more from the surrounding soft plaster block. Thames & Kosmos will launch six kits to start, including Tyrannosaurus Rex, Pterosaurs, Glowing Dinosaurs, Eggs, and Teeth!
NEAT-OH! Expands its line of Linkt Craft Kits, which teaches kids the art of chainmaille, with four new SKUs this spring. The new kits range in difficulty from Apprentice to Artisan, and allow kids to make custom metal jewelry and accessories in 30 minutes or less. The Metal Petals set lets kids create three necklaces and six pairs of earrings, and also includes a ring color personality list. The Whirly Loops set includes colorful silicone and metal rings for up to five necklaces; the Atomic Eye kit includes enough materials for kids to create five necklaces and matching earrings; and the Eclipse set—the most advanced kit in the new lineup—lets kids create three bracelets and two pendants. Linkt Craft Kits are designed for kids ages 8 and up.
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OrbMolecules, from ORB, is a creation compound designed for kids ages 5 and up. Each kit comes with thousands of OrbMolecules in different-sized color combinations, allowing kids to construct detailed creations, one atom at a time. This unique compound holds its shape until kids are ready to re-create. OrbMolecules is made in the U.S., never dries out, and is available in multiple colors and sizes.
Color Me Sqooshies—Sw eets, from ALEX TOYS, lets kids decorate their own squishy toys. Kids can cho ose from a kitty cupcake, uni corn doughnut, or bunny pop in the Sweets Set. Cute Bud dies and Emoji sets also offer kids more adorable squish ies. Each kit includes pai nts, glitter, and clips so kids can attach their creations to a bag or backpack. Each squish y toy is slow-rising for mo re fun.
with two new types WECOOL TOYS will expand its Compound Kings brand s fruit punch-scented of slime in the spring. Compound Kings Fruity feature Slime product, and slime. Each set includes three pods of clear, Squishy Like compound. fruit-shaped charms kids can mix into the sweet-scented compound in three Compound Kings Crunchy features Squishy Like Slime und is infused with bright colors; purple, teal, and orange. This new compo doubles as a modcrunchy bits for an oddly satisfying textured product that are designed for kids eling medium. Both new Squishy Like Slime compounds ages 4 and up.
Slime CRA-Z-ART’s Nickelodeon Slime Super s the minu slime Studio is all the fun of homemade slime the into s dient mess. After kids add their ingre h as watc and le hand maker, they can simply turn the mcusto can kids , Then slime magically starts to form. set The . more and , ize their slime with glitter, paint make the includes all of the ingredients kids need to perfect slime.
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UNIVERSITY GAMES extends its Doodletop line with three new Doodletop Squiggly Stencil Kits in the spring. The stencil kits will be available in three different themes: bugs, sea life, and sweets. Designed for kids ages 5 and up, each kit comes with eight reusable stencils and five colored pens to allow kids to make rainbow-colored doodle art. Doodletop is a classic brand with more than 30 million sold in 28 countries.
h a line of Barbie activity sets This spring, HORIZON GROUP will launc red Lip Balm kit lets kids create for kids ages 6 and up. The Barbie Laye , flavor droppers, lip shimmer, shiny lip balms using gel base, wax chips es of lip and more. Kids can make up to five shad add kids lets set le Bott er balm. The Barbie Wat dinclu e, bottl r wate ie Barb 3-D elements to their ie Barb The s. stone gem ing sparkling adhesive des 15 Fashion Plates All-in-One Studio inclu mix and can kids that s plate on double-sided fashi , and looks ue uniq 100 than match to create more of pops nt vibra add can eight crayons so they includes color. Plus, the Barbie Bath Bombs kit to five up make to kids for enough ingredients bs. bom bath ie sweet-smelling Barb
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New to EPOCH EVERLASTING PLAY’s line of Aquabeads sets is the Glamorous Designer Set. Kids can create rings, key chains, and more using new silver beads. The new set also connects to the beginner and deluxe studio sets. Kids can use more than 1,000 jewel and solid beads in 16 colors to create unique designs. The set includes a case, layout tray, bead peeler, sprayer, template sheets, and 3-D accessories. The Aquabeads line will also expand to include a Calico Critters Character Set, and a Disney Tsum Tsum Playset.
SPECIALTY TOYS & GIFTS
WHY INDEPENDENT BRICK & MORTAR TOY STORES ARE HERE TO STAY by CHRISTINE OSBORNE, owner, Wonder Works; principal, Christine S. Osborne LLC WHILE THE HOLIDAYS ALWAYS TEND TO creep up quickly on independent retailers, the strategic product buys for the season begin months before at the North American International Toy Fair in February. What we often forget is that we can find most brickand-mortar stores’ business strategies for the year within their business models. Toy store entrepreneurs are keenly aware of the online competition and showrooming they have faced in recent years. With the recent hype regarding Global Data’s prediction that 46 percent of all toys and games will be sold online by 2022, independent toy stores took their No. 1 weapon and turned it up a notch to sustain the future of brick and mortar: passion for the toy industry and for the kids whom their stores serve. Passion cannot be taught or bought, and certainly cannot be faked. Customers recognize that in a skinny minute. It is seen through the experiences stores offer to their customers. With the excess of free time that current technology provides individuals, restless kids crave a unique experience, event, or discovery. Independent toy retailers thrive on the ability to share their passion and expert knowledge with parents and children
Pete the Cat at a Wonder Works Toy Store
when they explore and play in their stores. The developmental milestones of a child are recognized, enhanced, and surpassed when a child is fully engaged in an activity where they can explore, question, and wonder. Play is one of the unique elements that offers this opportunity, and specialty toy stores are well-suited for this interaction. The exclusive caring and personal attention these stores provide is seen in every gift carefully wrapped and every birthday joyfully celebrated. Childhood is fleeting, and the experience felt in a neighborhood toy store is like none other. These memories stick with a child forever, and they are the reason families keep bringing back the next generation to shop. At Wonder Works in Charleston, S.C., a 28-year-old locally owned toy store, we hear every day: “My family squeals when they see your packaging!” The memories of experiences that even the wrapping paper from a specialty toy store evoke are totally unique. You may think the goal of an independent brick and mortar is to fill the modern consumer’s time with stellar engagement, but there is so much more that goes on inside the walls of our stores. Similarly, the National Retail Federation reported that for every single store closing, there are 2.7 stores opening. Localism is one of the fastest growing trends in the U.S., and will continue to make identifiable markings in communities nationwide. Doug Stephens of Retail Prophet succinctly targets the five elements of Remarkable Experiences. Independent toy brick-andmortar stores live and breathe the following principles; it is in their DNA: 1. Engaging: These experiences focus on the engagement of all five senses and involving the customer in a visceral way. When thinking of an experience, it may last hours, but memories of what we hear, feel, touch, see, and taste may last a lifetime. 2. Unique: Incorporate methods, language, or customs that are unusual, surprising, or proprietary to the brand, but that are also authentic and natural. The incorporation of these unique elements lends the feeling
that customers have not entered a different store, but a different world entirely. 3. Personalized: Make the customer feel that the experience was created just for them. This may be as simple as recalling details and preferences from an earlier visit, or it may be as complex as creating a completely bespoke product or service design just for them. Either way, they feel special and valued. 4. Surprising: Incorporate elements or interactions that are completely unexpected. Packing even one small surprise into an experience leaves a lasting impression. 5. Repeatable: These experiences are executed using prescriptive and tested methods to achieve a uniform level of consistency and excellence across the enterprise. They are so highly engineered and well-practiced that they appear spontaneous, while leaving almost nothing to chance. At the same time, the experiential design affords just enough freedom to let their unique personalities shine through. Independent toy stores are not going anywhere. According to a Nielsen poll, 69 percent of respondents think in-store purchases are most reliable, and 68 percent of them say brick-and-mortar stores are the easiest and most convenient way to shop. Brick and mortar will be redefined, as it has been every decade, but local toy stores will always create one-of-a-kind experiences and memories for kids, families, and their communities nationwide. For a truly magical holiday experience, visit your neighborhood toy store. Cherish your visit and the memories you make. You will get hooked, and you’ll come back— again, and again, and again. » Christine Osborne is the owner of four award-winning and industry-leading toy stores, Wonder Works, and the principal of Christine S. Osborne LLC. She brings magic to the Lowcountry through her spirit and enthusiasm, and her stores celebrate the power of a single child. Wonder Works aims to inspire creativity and wonder through hands-on play. The company’s passion lies within the growth and development of child entrepreneurs, entertainers, and charities.
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KIDS AR E FLIPPING OUT OVER
A Look at How Sequins Are Making Waves in the Toy Industry by KELLY CORBETT, editorial contributor MOVE OVER FIDGET SPINNERS AND squishies: another tech-free, tactile, and therapeutic trend is taking over. Sequins are surfing through the toy industry in the form of pillows and wristlets as of late 2017. Recently, instead of just cranking out fully coated sequin products, manufacturers took it a step further by adding what they call the “flip” factor. Fashion Angel’s Valentine’s Heart Pillow
With the stroke of a hand, kids can reverse the smooth sequins on their latest glitzy gear and watch as they reveal a new color or image. Stroke a sequined pillow to reveal a blue narwhal, then stroke the sequins in the opposite direction and, voilá, a unicorn! Mermaid Pillow Co. introduced this reversible sequin phenomenon to the toy industry in 2016. Tracy Sailors, who launched
the company with her husband Tom, was inspired after watching a viral video of a reporter in Texas running his hands over the back of a sequined pillow. “Each time he swiped his hand across the pillow, the pillow would change colors. They called it a ‘mermaid pillow,’” says Tom Sailors. He explained how Tracy decided to create her own version, leveraging the mermaid appeal one step further. After noticing that their little ones really loved the smooth texture of sequins, Tracy decided to make it exclusively for kids. Mermaid Pillow Co. launched with the first kids’ mermaid pillow, which featured an illustration of a mermaid on the front, and reversible sequins on the back. This product quickly went viral on Facebook and YouTube. From there, Mermaid Pillow Co. added almost 20 new designs, including dinosaurs, superheroes, unicorns, and more. Not only do these sequined sensations change color with a flip, but they also serve as a canvas on which kids can draw with their fingers and craft their own sleek designs. Fashion Angels offers a Magic Sequin Shop online where consumers can go to fulfill all their glittery needs. The digital shop offers an assortment of reversible sequin items, such as pillows, as well as fully coated sequined items sans the “flip” factor, such as pencil pouches,
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backpacks, and tumbler cups. Three Cheers for Girls (TC4G) also incorporated some glitzy and mermaid-themed product into its lineup, including a glitter mermaid necklace and a glitter journal with a flashy hologram cover. Still, it’s the reversible sequins that really bedazzle customers. “It is like magic when you watch the image change by just brushing it in another direction,” says Jamie Glassberg, vice president of Top Trenz. In a matter of seconds, kids can brush a whole new image onto their pillow, changing a unicorn to a whale or a cupcake to a doughnut. Yet despite the captivating visual, it’s not the only thing that drew people to the trend. “Customers are saying it is therapeutic when they brush the sequins back and forth in either direction,” says Glassberg. “It has the same effect that the fidget spinners had from a relaxational and Top Trenz’ Reversible Sequin Pillow
Mermaid Pillow Co.’s Discover Dinosaur Blanket and Think Shark Pillow
soothing aspect.” While the concept is simple—sequins that flip over with a simple swipe—the mechanics behind creating reversible sequins is a bit more challenging. Sewn on by machinery, manufacturers really had to tap into a certain sequin algorithm to get that “flip” just right. “Our designers have learned that the density of the sequins is crucial to having a successful flip,” says Goldi Miller, president of Fashion Angels. Miller explains that through a trial-and-error process, they learned that not all designs will work. Top Trenz, likewise, poured a lot of time into perfecting its sequin flip, even taking one extra step by introducing the reversible emoji and character pillows. Consumers can pick out a square pillow with an image, such as a peace sign that transforms into a cat with sunglasses when stroked. Or, if they want to step away from the standard square pillow, consumers can choose from a poop-shaped emoji cutout pillow that changes from brown to rainbow-colored when stroked.
Mermaids Are Real Beach Towel & Bag Set and Mermaid Dreams Nail Set, from TC4G
“Making the sequin reversible image was a very difficult process,” says Glassberg, recalling how it took the company a few months to really nail down the formula. But whether it’s an emoji-shaped pillow or a color-changing pillow, customers are going gaga over this enchanting accessory—so much so that retailers are struggling to keep them in stock. ”As soon as they come in, they’re gone in two days,” says Christine Osborne, owner of Wonder Works Toys, a toy store chain in South Carolina. She deems the trend as ageless, explaining how children, tweens, and even college students come in wanting their own fairytale-esque pillow to spice up their bedding. But beyond the pillow is the second generation of the reversible sequins trend. The sequin wristlet, or mermaid bracelet, by Mermaid Pillow Co., came about as a result of the success of their pillows. Osborne calls it “the new kid accessory.” “The mermaid bracelets were designed in response to parents telling us ‘My child loves the pillow; it’s too bad he/she can’t take it to school because it helps him focus.’ Or, ‘We’re going on our first plane trip and my child is nervous. I wish we could take the pillow because it really calms them,” Sailors says. Similar to the pillow, the bracelets have reversible sequins that change color when stroked. Overall, the future of this illuminating gear seems bright. Osborne believes this sparkly trend will have a long shelf-life. She explains that while these
sequins are trending in the toy industry and are popular among kids, the gift industry has started to adopt the trend, as many manufacturers are branching out and crafting their own adult reversible sequin products. For the 2017 holiday season, Absolut Vodka released a sequin bottle cover that had that oh-so-special flip factor. Stroke the sequins one way—they’re blue, stroke them again—they’re silver. It’s a magical visual onto which even adults can latch. Osborne believes this trend won’t lose its sparkle anytime soon. “There are so many possibilities for products with sequins like this,” she says. »
Kelly Corbett is an editorial intern at Adventure Publishing Group. When she’s not writing/playing/ thinking about toys, she’s probably spilling coffee on herself, laughing at her own jokes, or doing something awkward somewhere.
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ARE YOU READY FOR YOUR
CLOSE UP? by WENDY SMOLEN, founder, wendysmolen.com THE ANNUAL NORTH AMERICAN International Toy Fair is just around the corner. This is your chance to put your product in front of the buyers and sellers who may ultimately determine its success. How you present to people—who will hear dozens of pitches before and after yours—is almost as important as what you’re presenting. I asked seasoned experts from various stages of development and marketing what manufacturers must do to successfully move a product from the aisles of Javits to the aisles of retailers. While every product has its own story, there are some universal truths everyone should follow. DO YOUR HOMEWORK Just as you’d never expect to ace a test without studying, you need to prep before you meet with savvy buyers. While you hopefully considered competition before development, when surrounded by dozens of potentially similar products at Toy Fair, your succinct assessment of position is critical. “When presenting to a new retailer, go in knowing your product’s demographic,” says Veronica Walters, senior director of sales at Funko LLC. “Who’s your buyer? Who’s your competition? What’s your product’s point of difference?” HEED THE FEEDBACK You’re not being criticized; you’re being critiqued. “New York Toy Fair is a great opportunity to get input from buyers and sales reps, so present your products, ask questions, and, most importantly, listen to the feedback and make revisions before you manufacture,” says Jeff Pinsker, who founded two companies and sold three, along with managing companies such as Klutz, Cardinal, and University Games. “The guideline that I used when I had a start-up was POs, not promises, for 50 percent of the initial production run.” COURT THE MEDIA
Have a great media kit, including all product details—age range, price, retail and online availability—and a variety of visuals and links to videos to make it easy for the media. “It’s essential for new companies to keep three things in mind,” says Stephanie Azzarone, president of Child’s Play Communications. “First, they must be really clear on why media should care about them—what features distinguish their product from other brands on display at the show, and what benefits it offers kids and/or parents. Second, they should research the media that typically attend and reach out to them directly before the show, inviting them to their booth. Third, it’s important to follow up with those media afterward to determine what other information or materials—photos, samples, interviews, etc.—they might need, and provide them in a timely manner.” THINK ABOUT ADVERTISING Even if you can’t afford it right away, have an advertising strategy in mind. “When considering advertising for a young, emerging toy brand, first determine what stage of the product life cycle you are in,” says David Becker, president of Blue Plate Media Services LLC. “This will help you to define whether you should be focusing on trade or consumer advertising, two very different audiences with two different messages. A consumer media plan today serves two key functions: First, it will help you to sell your product in to your retailer. Second, your executed plan will help you drive consumer sellthrough. Each function is crucial to the success of your company and the survival of your brand. You must be able to communicate to your retail partner that you understand your category and that you have a plan in place to support your product once it gets on shelf.” THINK OF YOURSELF AS A BRAND, NOT A ONE-OFF Establish your credo at the beginning—
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then stick to it. “When branding your new product it’s important to have done the due diligence to define your brand promise,” says Stacy Lellos, senior vice president, general manager, Klutz/Scholastic Inc. “Understand exactly what your brand stands for. What makes it special? What sets it apart from the competition and brings value to consumers? Be authentic: A brand promise is about your character. Communicate it clearly: It’s how you deliver a consistent customer experience. Brand promises help you build emotional connections and that’s never been more important than today.” FIND THE RIGHT FIT Licensing is often considered the golden nugget, but not every license will work for your product. “The key to successfully licensing your product is finding the right property for your product,” says Lisa Shamus, president of Lisa Shamus and Partners. “One needs to look at finding a match that isn’t just logo slapping. Consumers, especially millennials, are savvy and there needs to be a reason why they will pay more for your product because it has a license. You are paying a fee for a property that has awareness and value, but it only works if it’s the right fit with your product. It is a lot like dating: When you find the right one, you know it.” » Wendy Smolen has spent more than 20 years playing in the toy industry. She cofounded Sandbox Summit, an idea forum focused on the intersection of play, learning, and technology. Currently, she works with companies and organizations to create playful solutions that engage kids and families in innovative and impactful ways.
DRESSING THE PART Howard Beige, executive vice president, Rubie’s Costume Co., discusses Halloween trends, the business of dress-up, and Rubie’s plans for 2018.
Rubie’s is the leader in Halloween. What is the fastest growing part of your Halloween business? Family and group costumes, and our DIY/ Mix ’n Match Accessory programs. These trends have grown for the past few years, and are projected to continue to grow in the future. What trends are you seeing in the way families celebrate Halloween? Unlike in prior decades— where children did mostly trick or treating and adults celebrated Halloween with other adults— today, most people celebrating Halloween and having parties invite entire families over with pets included. Halloween has evolved into more of a familyfun holiday.
of BuySeasons’ business today is wholesale fulfillment for companies selling costumes on the internet. Many of the largest costume internet retailers today purchase and stock the most popular items of the season directly. However, they are able to expand their assortment offering online by listing hundreds or thousands of additional items that BuySeasons keeps in inventory and ships direct to the consumer for their wholesale accounts. This allows the internet costume retailer to offer a huge assortment of product without investing in every item. It is a great way to supplement a company’s assortment online.
What percent of Star Wars Executioner Rubie’s recently acquired consumers are lastBuySeasons. What was the minute shoppers strategy behind this acquisition? How does when it comes to this benefit Rubie’s? Halloween costumes? How can Rubie’s considers the acquisition of retailers prepare and appropriately BuySeasons to be very important stock for that type of shopping for its long-term growth. cycle? The overwhelming majority As all of our lives are busier than any other time in the past, and last-minute Halloween shopping has become quite the norm. In recent years, 50 percent of all costumes sold in brickand-mortar outlets are
sold in the last seven days of the Halloween season. The trick to remaining in stock during the final seven-day period of the Halloween season is to take notice of what is selling and what is important early in the season, and reordering those items quickly to ensure an ample supply the last week of the season. What are the top trends in Halloween costumes for 2018? What themes or licenses are leading the way? Again, with Halloween becoming more of a family-fun holiday, the top trends in costumes for 2018 are family and group costumes, including the family pet. Some of the top themes for 2018 will be superheroes, girl power, sci-fi, and horror. Top licenses for 2018 will include IT, Justice League, Star Wars Episode 8: The Last Jedi, Jurassic World: Fallen Kingom, Avengers: Infinity War, Han Solo: A Star Wars Story, Jojo Siwa, Ant-Man and The Wasp, Deadpool 2, and Spider-Man.
JoJo Siwa Video Outfit
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How does social media affect Halloween sales? Social media has a tremendous effect on costume choices for tweens, teens, and young adults. When you see what your friends are interested in and having fun with, it certainly affects your costume choice. A great example is the Inflatable T-Rex from the Jurassic World movie.
Were there any surprises or sleeper hits for Halloween 2017? How does Rubie’s prepare for and react to last-minute hot sellers? We had several surprises for Halloween 2017. The two biggest surprises were Pennywise the Clown from the movie IT that released on September 8, as well as the unexpected popularity of the Jojo Siwa costume. Because both of these characters did not become hot until September, this was a real challenge for Rubie’s. Once again, the advantage that Rubie’s has is its strong domestic production. Rubie’s still manufactures approximately 25 percent of its domestic sales in its own U.S. factories. Without this domestic production, it would have been impossible to respond to the amount of last-minute demand that we had for these unexpected Halloween hits. The Imagine by Rubie’s line offers kids year-round dress-up options. When did you introduce this line, and how has it grown and evolved since then? The Imagine by Rubie’s line was launched in 2012 and has grown exponentially in the years since. The opportunity was using Rubie’s expertise and licenses in costumes to create a line of dress-up with fun-filled features and play value for children that parents would also love. This line isn’t packaged like a costume, but instead like a toy item, usually in a box, and sits on the shelf next to the action figures in toy departments worldwide 12 months a year.
What differentiates your Halloween offerings from your dress-up line? Halloween costumes tend to be a full costume from ankle to neck and often include a mask or a headpiece. Costume accessories are sold separately. The Imagine by Rubie’s dress-up line is all about fun and play value and is meant to provide everyday fun for the child. These dress-up sets usually include some play value accessories in the package.
What trends are you seeing in kids’ dress-up and role play? Dress-up and role-play is a growing phenomenon in the toy industry. Parents and grandparents love the old-fashioned play value and stimulation to a child’s imagination that dress-up provides. They consider it
a break from technology and a healthy option as children often play outdoors. The types of dress-up and role play that are in demand are what kids are seeing in the movies, on TV, in webisodes, or via their streaming services. What are the top-selling licensed and nonlicensed dress-up products? What percent of sales/volume are perennial favorites versus trending entertainment licenses? Similar to Halloween, the top-selling licenses are Batman, Spider-Man, Star Wars, Wonder Woman, Captain America, Iron Man, Superman, Harry Potter, and Teenage Mutant Ninja Turtles. Nonlicensed characters that are popular are the policeman, fireman, doctor, SWAT, princess, fairy, and ninja. Today, in the toy department, licensed dress-up accounts for approximately 70 percent of all dress-up sales. How do dress-up and role-play sales fluctuate throughout the year? How does this side of the business complement Rubie’s Halloween business? Dress-up sales is a 12-month-a-year business with an obvious peak in the fourth quarter. In addition to this, individual license sales will certainly spike around the release of the theatrical movie or DVD. Dress-up costumes are an excellent addition to any party store, gift store, toy store, or specialty store. »
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RUBIEâ€™S COSTUME CO.
1. The Licensed Rey Costume from Star Wars: The Last Jedi features a top with attached wraps, pants with attached boot covers, arm warmers, 3-D cuffs, and a 3-D belt. Available in child and adult sizes. 2. The Licensed Jurassic World Inflatable T-Rex Costume is a finalist for The Toy Associationâ€™s Innovative Toy of the Year Award. It includes a full body inflatable jumpsuit with a battery-operated fan and is available for both children and adults in size standard. 3. The Licensed Grand Heritage Wonder Woman Costume from Justice League features a deluxe adjustable bustier with bandolier, skirt with attached boy shorts, gauntlets, glovelets, an armband, leg guards, a deluxe hooded cape, a lasso, a sword, a shield, and a tiara. Available in adult sizes small, medium, and large. 4. The Licensed JoJo Siwa Bomber Jacket Outfit features a bomber-styled jacket, a pink skirt, and a matching pink hair bow. Available in child sizes small, medium, and large.
RUBIE’S PET SHOP BOUTIQUE
4. 3. 2. 5. 1. The Walking Teddy Bear Pet Costume is a comical and soft costume that is one of the internet’s latest hits. This step-in costume features stuffed arms to make it look like your pet is standing straight up. Available in sizes small, medium, large, and extra large. 2. The Licensed Wonder Woman Pet Costume features a dress with a logo patch, a broad gold belt, and a blue skirt with white stars in a shiny, metallic material. It also comes with a gold metallic tiara with a red star accessory. 3. The Snowman Pet Costume is the most adorable look for this winter. This step-in costume has attached stick arms, a scarf, and a hat. Available in sizes small, medium, large, and extra large. 4. The Pet Shop Boutique Licensed Barbie Tracksuit Pet Costume is an officially licensed fashionable Barbie velour tracksuit that will have pups jogging in style. It’s designed for fashionista pups who like to keep warm in the winter. Available in sizes small, medium, large, and extra large. 5. The Licensed Flash Pet Costume features a bright red shirt with yellow details and the iconic lightning logo, along with a red hood complete with ear holes and lightning bolts.
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IMAGINE BY RUBIE’S 1.
1. The Licensed Wonder Woman Costume from Justice League includes the iconic colored blue, red, and gold dress, with a fabric tiara, a lasso, and two gauntlets. 2. The Licensed Tactical Batman Costume from Justice League features a fiber-filled muscle chest top, a cape, and a Batman tactical mask. 3. The Licensed Spider-Man Costume from Spider-Man: Homecoming includes a deluxe costume foam-back printed muscle chest top with a fabric mask. 4. The Licensed Harry Potter School Trunk from the Gryffindor House comes complete with a hooded robe with an emblem, the iconic scarf and tie set, glasses, and a wand. Available in child size medium. The Imagine by Rubie’s line is designed for everyday dress-up and year-round gift giving.
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OUTSIDE THE BOX
PUSH THE BRAND WITHOUT LOSING THE CONSUMER by TED MININNI, president and creative director, Design Force MARKETERS SEEM SO INTENT ON USING every conceivable platform to leverage their brands—digital or otherwise—that they often lose the customer in the process. Brand-centric thinking isn’t necessarily customer-centric, is it? Consumers aren’t interested in purchasing branded products that are largely viewed as commodities in one category after the other; they’re interested in being engaged with connective, emotive experiences. Brand marketers in every sector continue to state that customer experience (CX) is their top priority, yet it’s clear that most are failing to accomplish their goal. Why is that? The short answer is that marketers need to reorient their thinking and the manner in which they work. Why aren’t we designing our brands to meet the wants—over the needs—of consumers today? When will we catch up to the new consumer ethos that no longer wishes to buy products, but rather to collect experiences? When will the power of product and package design be totally unleashed to connect brands to people’s lives in a meaningful, relevant manner? Finally, why haven’t we made the transition, as marketers, to the understanding that the customer experience that we create IS our branded product? HOW DO WE GET THERE FROM HERE? Unfortunately, most consumer product companies are still focused on top-down business strategies. Of course, it’s important to have an overall focus and strategy, but the old business model—in which the consumer is factored in at the end, rather than at the beginning—ought to be a thing of the past. A Forrester study from 2014 found that less than one-third of customer experience managers confirmed that their companies consider the impact of their business decisions on CX. Customer experience may be top of mind for most marketers, but delivering it is another matter. For one thing, companies are tracking the wrong metrics. While sales, conversion rates, and social media hits are important, they don’t measure the level of engagement or the quality of customer expe-
This represents significant challenges to consumer product companies; there’s no doubt about it. But if brand managers know their customer on a human level, rather than merely trying to understand them through digitally generated reports, they can work to deliver consistently great experiences that build lasting relationships. They can also deliver in a personalized manner, which consumers increasingly crave and value. In our work with some of the most powerful experiential consumer product brands and licensed properties, we know that strong relationships build brand value in the eyes of consumers. Consumer-focused companies continue to anticipate what their customer wants next, making them relevant and rendering their competitors irrelevant. Consumers find these products meaningful, and the brand packaging makes them compelling and irresistible, leading to satisfaction on a deeply emotional level. Experiential brands are dynamic and they make their competitors appear to be static. rience. They don’t measure the consumer’s emotional connection to brands. Customer experience has to be viewed through the lens of relationship building. “Experience Strategy: Connecting Customer Experience to Business Strategy,” a recent research study compiled by Charlene Li at Altimeter, reaffirms that building consumer relationships should be the cornerstone of a brand and business game plan. It also proposes that it’s time for a new way of thinking about customer experience. “A next-generation experience strategy isn’t about using the latest whiz-bang technologies to create ‘delightful’ experiences,” she writes. “Instead, it harnesses the power of data and analytics to understand individuals at scale and develops relationships in a rapidly changing context, preparing the organization to serve the next generation of customers.” The metrics to which Li alludes are customer satisfaction and Net Promoter Scores—both barometers of the health and strength of consumers’ relationships to brands.
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EMBEDDING DESIGN Every time consumers become deeply engaged with a brand or enjoy a powerful experience, it leads to a rise in their overall expectations where every brand experience is concerned, presenting yet another challenge for brand managers. Yesterday’s traditional marketing and business structures aren’t effective, but a fusion of design thinking and design principles can elevate brands to consumer centricity because it humanizes everything that it touches. Here’s what I mean: Consumer product companies that are leaders within their sectors work hard to adjust and respond to today’s consumer’s paradigm shift by continually elevating CX to deepen brand relationships—and that is being achieved through design. Mattel presents a great example of this, as the toy giant grapples with making heritage brands such as Barbie and Hot Wheels relevant to a new generation of kids, even as it launches successful, experiential new franchises, such as Monster High.
OUTSIDE THE BOX Mattel’s evergreen brands are focused on updated product and package design, contemporary storylines, viewpoints, and aspirations that appeal to a new generation in an emotive, relevant manner—and the company is designing new franchises with a thoughtful new approach. The latest brand, Enchantimals, has the power to become a huge hit because it is absolutely in step with young kids. In the press release the company issued to announce the new brand, these insights were shared: “At Mattel we are passionate about introducing properties that are both on-trend and purposeful,” says Lori Pantel, SVP and GM for Girl’s Toy Box. “We’re essentially bringing a popular animal aesthetic inspired by social media filters and marrying it with product and stories encouraging empathy and friendship.” Kids form a powerful bond with their pets, who become their “besties.” So, Mattel designed its Enchantimals as half girl/half animal creations, with characteristics of the pets with which they come. For example, Bree Bunny and her rabbit, Twist, are “up to their ears in creativity.” Danessa Deer and her pal Sprint “love to run through the woods to see who can win the race.” The dolls are beautifully designed and sold within a unique package structure with “ears” and woodland scenes as a backdrop for the product. A custom type treatment, with the top of the “T” as a fox’s tail, is used for the Enchantimals logo, which appears in a soft green on the bottom center of each package against deep blue package design architecture. The dolls, play sets, and packaging are not only enchanting, but they’re highly experiential. Mattel brought Enchantimals characters and their stories to life via short-form YouTube content, as well as an hour-long TV special in
the fall. No doubt, Mattel will create brand extensions, use multiple platforms to keep the brand in front of its audience, and eventually license Enchantimals, but how relevant and engaging it remains going forward will determine the success of the brand. TAKING LICENSING TO A NEW LEVEL I’ve cited Moose Toys’ Shopkins toy collectibles recently because of its brand design. Conceptually, there wasn’t anything quite like Shopkins in the marketplace when the brand launched in 2014, yet kids love collectible, funny characters and silly storylines. Especially when the characters are presented in a fanciful manner, and they’re imbued with charming faces and personalities and irresistibly packaged. With Shopkins, all of these elements are part of the brand design. Everyday items become cute characters and stories delivered in a series of short YouTube webisodes, enthralling kids worldwide. How did Shopkins come to the attention of so many kids? Paul Solomon, co-chief executive of Moose Toys says in an article from the LA Times: “We didn’t launch with any TV series or any mainstream entertainment because we knew consumers were on YouTube as much as traditional TV. Kids are looking for instant engagement from the brands they love.” Exactly. Moose launched several generations of Shopkins with fresh characters and new storylines, continuing to engage kids. But we all know that relevance with kids, or any consumers for that matter, can be fleeting. The Shopkins brand team wisely did more than seek out strong licensing partners to create products in the ubiquitous apparel, home décor, and accessories categories. Understanding the power of real-life experiences, Shopkins marketers planned compelling, licensed events for young fans in the U.S. What better way to launch the Shopkins collection dubbed World Vacation (Europe) than a Parisian-style pop-up café? Over a four-day period this June in New York, 400 Shopkins fans were able to experience the Macaron Café in person. Reservations to attend sold out in less than a minute after going live, with more than 4,000 families on a waiting list. Lucky attendees received Shopkins-themed macarons and French delicacies, manicures, and Shopkins swag: all free of charge. Even better: They got a sneak preview of the brand’s forthcoming Shopkins Live, a 75 U.S. city theatrical tour that began in September. The show features fan favorite
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Shoppies, such as Jessicake, Bubbleisha, and Peppa-Mint in a new storyline filled with colorful costumes and sets and original pop music. Besides live events, the company launched Shopkins Direct, a subscription service that gives kids a home delivery of a box filled with Shopkins goodies once per quarter. According to the company website, each box features apparel, toys, and accessories that can’t be found elsewhere. What Shopkins is achieving, in essence, is 360-degree marketing that is highly emotive to its legions of fans. These experiences are the Shopkins brand and we could argue that they’re more important than the products themselves. Otherwise, why wouldn’t kids be as enthralled by other collectibles? I have no doubt that Shopkins will continue to enthrall its young fans by designing product, packaging, and live experiences that go well beyond meeting basic expectations. These experiences will continue to deepen the relationships between kids and their Shopkins besties, making countless other brands irrelevant. And that, my friends, is the power of meaningful CXs. »
Ted Mininni is president and creative director at Design Force Inc., a package and licensing program design consultancy to the consumer product and entertainment industries. The goal of Design Force is to establish strong emotional connections with consumers and create powerful visual brand experiences that engage, excite, entertain, inspire, and influence consumers’ decision to buy. Mininni can be reached at (856) 810-2277. Visit designforceinc.com for more information.
MENTORS GIVING BACK
The WIT Empowerment Day Experience by DEB DE SHERBININ, principal, Perk Consulting and WIT Empowerment OCT. 1, 2017 MARKED THE FOURTH annual Women in Toys (WIT) Empowerment Day at Fall Toy Preview in Dallas, and the fourth year I’ve had the pleasure to work alongside my friend and Empowerment CoChair, Nancy Zwiers, chief marketing officer at Spin Master, to create this uniquely intimate and powerful day of mentorship and inspiration for women-owned businesses and female entrepreneurs. And with each passing year, it gets better and better. Nancy and I share a passion for mentoring women by providing support and opportunities to help them grow in their careers. Every year at Empowerment Day we are joined by a team of industry experts and mentors who share our beliefs and our passion, and who generously donate their time and talents to help our members. As someone who loves innovative products and helping clients develop their businesses and grow their brands, it is especially rewarding for me to see, hear, and feel the impact that the experience at Empowerment Day has on the attendees, as well as on the speakers, mentors, and buyers who take part in the day. WIT Empowerment Day got its start as an opportunity for women-owned businesses to pitch Walmart at the New York Toy Fair. Anne Marie Kehoe, vice president of toys at Walmart, has been committed to WIT Empowerment Day for the past five years, bringing her toy-buying team to hear pitches and share insightful feedback to WIT’s women-owned businesses. After moving the event to Dallas in 2013, WIT expanded Empowerment Day to include product pitches to toy companies, speakers, panels, and speed-mentoring sessions. It is free to attend for WIT members, and gives women the chance to pitch, learn, and connect with the movers, shakers, and decision-makers in the toy industry. Each year, our space at Dallas Market Center is generously donated by The Toy Association, which always goes the extra mile
Deb de Sherbinin and Nancy Zwiers speak at the Women in Toys Empowerment Day in Dallas.
to make sure we are well taken care of. “Kicking off Fall Toy Preview with WIT Empowerment Day is the best of the toy industry all at once,” says Empowerment Day Mentor Kimberly Carcone, vice president of market events for the Toy Association. “Welcoming eager and enthusiastic entrepreneurs to Dallas and providing an opportunity for mentors and students to engage, connect, learn, and venture into their future is a sincerely gratifying experience and one The Toy Association looks forward to continuing for many years to come.” They say it takes a village, and the WIT community lives and breathes that ideology. For this event to happen, it takes a team of creative and collaborative volunteers countless hours to plan, organize, and execute the event. My heartfelt thanks to Empowerment Day committee members Brandi Pinsker, Elizabeth Kong, Lisa Pelletier, Michele Martell, Karen Kilpatrick, and Genna Rosenberg, who delivered a day filled with inspiration and opportunity.
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Empowerment Day was dedicated to more than 80 women who traveled to Dallas to get one-on-one access to industry mentors, subject matter experts, inventor relations and product acquisition decision-makers, and Walmart buyers. Participants included inventors, small start-ups, and established companies seeking to pitch, learn, and grow. Most came to pitch their products to Walmart and toy companies in an effort to make a deal and grow their products at retail. Dozens of mentors, speakers, and presenters from all corners of the business took time out of their busy schedules to share their knowledge, experiences, and Rolodex of contacts to give the women both guidance and support. An all-star cast of speakers enlightened the audience with valuable insights and inspiring stories. Norma Rosenhain, CEO of Creata, shared her inspirational story of taking her dream product from garage start-up to owning a global company, and producing more than 15 billion toys, distributed to 120
countries, without causing harm to any child. She touched us all with her genuine warmth and passion, encouraging everyone to take full advantage of the opportunities that networking can provide. And without skipping a beat, she spent the rest of the day in conversation, welcoming all who approached her as she shared advice and encouragement. A Walmart buyer panel led by Nancy Zwiers included Walmart.com and traditional toy buyers, who shared critical insights and tips for pitching a product. Other panels included a presentation about product safety and testing advice, e-commerce strategy tips, and using Direct TV to launch a product. The “Be an Inventor” panel featured inventor relations and product acquisition executives from toy companies, who gave an inside look at their evaluation processes. Pitch sessions were buzzing all day, as the team of Walmart buyers and inventor relations executives from Hasbro, Spin Master, PlayMonster, and Jazwares huddled in private pods to review dozens of products and concepts, listening attentively and providing thoughtful feedback to product pitchers throughout the day. “I love participating in WIT Empowerment Day as it gives me a chance to give back and encourage more women to enter the toy industry,” says Lisa Wuennemann, director of marketing at PlayMonster. “Many new ideas solve a problem, and women are great problem-solvers! If I can help women bring their ideas to the toy industry, we all benefit from their contribution.” This was the first Empowerment Day experience for Hasbro’s Tanya Thompson, director of global product acquisition gaming, who said, “It was a great event to meet new inventors and to celebrate and support women in the toy industry.” More than 25 expert mentors from all functional areas of the business took part, covering everything that goes into a product life cycle, from concept to packaged item ready for sale. Experts in marketing, sales, advertising, product development, branding, packaging, PR, manufacturing, product safety, licensing, finance, e-commerce, IP, and content creation were on hand. “I attended WIT Empowerment Day as an
industry mentor and found myself awed by the creativity, perseverance, and resilience of the entrepreneurs discussing their ideas and inventions. The Women in Toys organization is filled with a powerhouse group of women whose dynamism inspires me,” says marketing mentor Stacy Lellos, senior vice president and general manager at Klutz. “Mentoring at WIT Empowerment Day was a win-win experience,” says public relations mentor Stephanie Azzarone, president at Child’s Play Communications. “The women who attended found answers to important questions, and, as a mentor, it felt terrific to be able to help. The individuals I spoke with represented companies ranging from start-ups to established brands. For the newcomers to the toy industry, it was a good opportunity to discuss ‘PR 101’—the basics they needed to get started. For companies that already had programs in place, it was interesting to provide a different perspective and have a more in-depth conversation.” The attendees’ experience in creating and launching products varied. Some attendees had little to no exposure to the toy industry, so they sought out sage advice and guidance from experts in Speed Mentoring sessions. “WIT Empowerment Day was phenomenal,” says licensing mentor Lisa Shamus, president of Lisa Shamus and Partners. “After meeting with over a dozen women at the event, I had significant follow-up with several brilliant women. I am so proud to be part of an organization that mentors and helps women, and that I am able to see first-hand how we help move women, businesses, and ideas ahead.” Lisa’s sentiments were parallel with licensing mentor Joan Grasso, vice president of licensing at Entertainment One and WIT’s New York Chapter Co-Chair. “I find it incredibly rewarding to offer my expertise and knowledge to provide our members with helpful, useful information, allowing me to contribute to the growth of these women’s businesses and their future success,” she says. Industry organizations were also on hand to introduce the resources and benefits they provide, including The Toy Association, ASTRA (American Specialty Toy Retailing Association), LIMA (Licensing Industry Merchandisers’ Association), SBA (Small Business
Association), WBENC (Women’s Business Enterprise National Council), and The U.S CPSC (Consumer Product Safety Commission). “It was an amazing day of learning and networking,” says Sue Warfield, director of member relations at ASTRA. “WIT Empowerment Day was a great opportunity for ASTRA to meet with incredible inventors and share what our organization has to offer.” WBENC partners with women-owned businesses. “Participating in WIT Empowerment Day and providing mentorship to the attendees was a great experience,” says Jill Sasso, SHRM-SCP senior director of human resources. “WBENC is proud to partner with WIT to educate women business owners about the value of certification and the benefits WBENC can provide to help them grow their businesses.” On a personal note, I appreciate the support and dedication of Ashley Mady, WIT’s president, and the WIT board, who are committed to offering and funding this unique opportunity to help women succeed in the toy industry. My heartfelt thanks to the A-team at WIT, including Mary Kay Russell, WIT executive director, and staff members Peg Brom and Amy Good. Their planning behind the scenes made this day perfect in every way. We appreciate the support and dedication of our corporate partners and sponsors, without which this day would not be possible. Special thanks to Walmart for its ongoing support and generosity, and to Hasbro for sponsoring lunch and keeping everyone well nourished and ready to power on. »
Deb de Sherbinin is founder and principal of Perk Consulting. With experience in product innovation, brand development, and marketing, Perk Consulting offers innovative thinking, marketplace savvy, and strategic direction to entrepreneurs and growing companies to accelerate their journey from new idea to successful product.
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TEN CROWDFUNDING TIPS FOR THE TOY CATEGORY
by JP STOOPS, founder, Pixl Toys and creator of the Pixlplay Camera CROWDFUNDING HAS BEEN ONE OF the key drivers to innovation in the toy category in recent years. Many companies make crowdfunding look easy, while some of the best toy ideas never get funded. So what’s the trick to a successful crowdfunding campaign in the toy category? After speaking with countless entrepreneurs who have run crowdfunding campaigns, and after running a successful campaign for the Pixlplay Camera earlier this year, I’ve narrowed it down to 10 tips to running a successful crowdfunding campaign.
The good news is that much of this can be sourced through the “gig” or on-demand economy. For example, I found a great industrial designer on the platform Red Clay Design. For the campaign itself, you may be better off hiring an agency if you have the budget. My entire Kickstarter page was designed by someone hired through Upwork. Make sure you can make the product if you reach your goal. Make as many prototypes as needed to ensure you can make the product you say you can. Line up your factory. Know your costs. Don’t forget shipping. Double it.
Know your customer. The Kickstarter customer is not the primary toy buying customer. The crowdfunding customer is willing to wait a long amount of time for a product with the latest bells and whistles. Within the toy category, coding, DIY, robots, games, and some girl empowerment products do better than average. Traditional toys often struggle, so the more you can position yourself to appeal to the 25-to34-year-old millennial, the more likely you will be to succeed. The 3Doodler, for example, raised more than $2.1 million partially because it was marketed to DIY enthusiasts. Today, it’s clearly sold as a toy. The notorious Fidget Cube was also marketed to millennials through a fun and quirky video about anxious behavior.
through and we raised more than 50 percent of our goal in the first week.
Rally your network. Start by sharing 2 your idea with as many people you can trust as possible. Let them know what you’re up to. Listen. Reach out to fellow crowdfunders for advice and be willing to adapt your message. I sent surveys to every parent I knew and asked them to send it to their friends. What resulted was a tribe of supporters who gave invaluable feedback on the product, pricing, marketing, and design.
Build a strong email list. The most successful campaigns are skilled at building email lists though landing pages. These campaigns ensure they can raise more than 30 percent of their goal in the first day. My email list was not big, but my network pulled
Run ads before the campaign launches. Sites such as AdEspresso make it easy to test your images, copy, and eventually your audience to see what works. I promise that you’ll be surprised by what people click.
Get to know the press. Either hire an agency or spend a lot of time getting to know the individuals who have written about crowdfunding. Have a clear story and focus on the outlets that can reach your customer. (Hint: Bloggers and parenting sites are much more important than national media).
Make a budget. Dedicate significant re5 sources to design, build, and promote your product. This is not a get-rich-quick scheme, but a way to prove concept or bring your dream to life.
Ask for help. There are so many elements to running a successful crowdfunding campaign. Very few companies or people will have all the skills to do everything. But, most of us know someone who likes photography or maybe even a videographer. Be willing to ask for help and bring them onto your team!
Finally, run social media ads. The days of “set it and forget it” are over (Was there ever a time?). Successful campaigns spend 20 to 30 percent of their goal on marketing. That means most of the $1 million campaigns spend $300,000 on marketing. There are agencies who will fund your marketing, but there are no guarantees. Be willing to give up to 30 percent of the amount earned.
This is a learning experience like no other. Kickstarter and Indiegogo InDemand helped me bring Pixlplay to life and start a company. I’m forever thankful to these platforms and the more than 1,400 backers in 38 countries— including many of the specialty toy retailers across the country—who backed Pixlplay. »
Hire experts. Inevitably, you won’t have all the expertise on your team.
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JP Stoops is the founder of San Francisco-based Pixl Toys. He recently raised $65,000 through a successful crowdfunding campaign on Kickstarter and Indiegogo InDemand. Stoops is a former toy buyer and licensing executive. He is passionate about developing affordable tech toys with companion apps that get kids active and creative.
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O • A C • an S M E • W B • G •
FLASHBAC The handheld electronics market experienced an incredible evolutionary growth spurt this past summer when virtual pets burst into the digital family, achieving instant pop-status. It is estimated that more than 85 million units have been sold worldwide between the three top manufacturers. Radica’s Lunker Bass Fishin’ and Bandai’s DigiMon are expected to be hot sellers in 1998.
Bandai Digital Entertainment » launched a CDROM version of its original virtual reality pet Tamagotchi. The CD-ROM is available for Windows 95. Similar to the original, the Tamagotchi need care to survive, but will live on the user’s PC. If they are well cared for, they will flourish. According to Bandai, the characters will feature a much broader range of visual and audio expressions, as well as more interactive games that users can play with their Tamagotchi.
SANDYLION STICKS WITH RUGRATS Sandylion Sticker Designs acquired the license to create stickers for Nickelodeon’s Rugrats. Available in the line is a mix of slime and maxi stickers, a sticker album, a Sticker Treasure Kit, and a Sticker Extravaganza. All of the sets feature the lovable characters, Tommy, Chuckie, Angelica, and their friends.
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INNOVATION SPURS GROWTH IN HANDHELD ELECTRONICS MARKET
Sticker Stations are patented » digital photo sticker machines from American Photo Booth, Inc. Already a hit in Japan, these kiosks resemble an arcade game. The user can put his or her face in front of a variety of backgrounds and, in under 60 seconds, it yields 16 high-resolution, peel-off color photo stickers.
My Virtual Baby, from MGA Entertainment, taps into the handheld electronic buzz. This virtual reality pocket toy teaches kids to raise productive members of society.
View this email in your browser Happy New Year! The holidays are behind us, and we’re ready to play with a brand new slate of toys. But...