|
|
ONLINE FEATURES
Book Reviews
BW Video
Columnists
Interactive Gallery
Newsletters
Past Covers
Philanthropy
Podcasts
Special Reports
BLOGS
Auto Beat
Bangalore Tigers
Blogspotting
Brand New Day
Byte of the Apple
Economics Unbound
Eye on Asia
Fine On Media
Green Biz
Hot Property
Investing Insights
Management IQ
NEXT: Innovation
NussbaumOnDesign
Tech Beat
Working Parents
TECHNOLOGY
J.D. Power Ratings
Product Reviews
Tech Stats
Wildstrom: Tech Maven
AUTOS
Home Page
Auto Reviews
Classic Cars
Car Care & Safety
Hybrids
INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | | JUNE 16, 2003 NEWSMAKER Q&A By Karen E. Klein Hit Toys: More Than Child's Play The world's playpens haven't seen too many blockbusters lately. Can a "toy talent quest" find the next Tickle-Me Elmo?
Given the dearth of recent blockbusters, Creative Group Marketing (CGM) of Stamford, Conn., is launching a nationwide search for hot new toys and concepts. "Toy Search America 2003" aims to choose promising, innovative products developed by entrepreneurs and inventors and introduce them at 2004's Toy Fair, the industry premier showcase. CGM will waive its routine submission fee for ideas for new toys, games, or baby/children's products, says Gary Ahlert, the firm's president, who spoke recently to Smart Answers columnist Karen E. Klein. Q: Why hasn't there been a breakout novelty product or runaway hit toy in the last few years? A: It's hard to say. The toy business is very much like show business: We can't predict what's going to be a hit, or not a hit. What makes a Pokemon suddenly take off? Or a Beanie Baby? Kids latch onto things and they take off. Product placement helps, and exposure can launch a toy and enhance sales. But generally speaking, toys that you see in toy stores are not featured anywhere, they're just toys that are on the market. Q: What about September 11, terrorist threats, and war? Do world events have an impact on the toy markets? A: Absolutely. World events change tastes a lot, which is another reason we can't predict what's going to be appealing at any particular moment. After September 11, all the products with violent themes had to be taken off the shelves and anything that was family-oriented, homey, cute, and cuddly was suddenly very hot. Q: Don't new product ideas come from the research and development divisions of the big toy and game companies? What chance do amateur inventors have at getting their products into stores? A: Actually, almost all of the toys that you see in the marketplace come from private inventors. Some are professionals, but most are not. The toy industry is unique in that way. There's less inhouse development and more reliance on licensing new products. It's not like they have big departments with researchers sitting around brainstorming the newest flavor of toothpaste. A lot of the big products over the years have come from private inventors or ordinary people with good ideas -- people who couldn't sell them to the leading toy companies to save their lives. Q: Why can't they sell them directly to the big toy manufacturers, such as Mattel, Tyco, and Hasbro? A: Most toy companies will not look at submissions from outside inventors. They require inventors to go through agents that they recognize as professionals. Their main worry about looking at ideas from walk-ins is liability. They're opening themselves to big lawsuits if they look at ideas from inventors, and they are already working on something similar, or they come out with a similar product and don't credit that inventor. Agents also help screen the toy ideas and lend the inventors some credibility with the manufacturers. Q: What do you look for when you get submissions for your toy search? A: We're looking for anything and everything, from toys to games, plush toys, and novelties. We figured it was time to open the doors and see what's out there, what ideas people have. We'll find a few that we believe are promising, offer them representation and then make sure they get full exposure to the appropriate companies. Q: You must have to offer intellectual property protection. How do you go about shielding your company against liability? A: We deal with nondisclosure agreements and contracts and, if we decide to represent a product, we work out licensing agreements with the manufacturers. We also do a lot of product development, so the original concept of the toy may change dramatically by the time it's released to the public. There's an awful lot of work involved in representing a client: There are usually repeated showings of the idea, months of work in licensing it, and then it could take years to be noticed, produced, picked up by large manufacturers. Q: Sounds like a tough business. What advice do you give would-be entrepreneurs and inventors who think they've got a great idea for a new toy or game? A: Go into it with your eyes open: Not everybody makes millions of dollars. You may have the next Tickle-Me Elmo, but it's only about one out of 10,000 ideas that get picked for representation, let alone hit really big. Toys also have a notoriously short shelf-life -- things like Monopoly and Barbie are aberrations in the industry. I also caution people because there are an awful lot of scam operators out there, most of whom are only interested in your money. Do not, under any circumstances, pay a substantial upfront fee to anyone who claims to be an agent. It's not unusual to have small up-front fees or have an agent bill you for some early expenses, but if you are asked to pay $10,000 or $30,000 upfront that should be a very big red flag. Seek out a good agent who is familiar with the business and check out his or her track record. Ask them what their success rate is with other clients. How many licenses do they have with toy companies? How many of their licensees have made money? They should be able to give you concrete answers and documentation to back them up. Q: Where does an inventor find a reputable agent? A: Check out the Toy Industry Assn., or search on the Internet under terms like "agents," "marketing," "toy broker," or "licensing agent." Just make sure that you get good background information on anyone that you find online, and check them out with the Federal Trade Commission and Better Business Bureau. A lot of the agents or invention-licensing firms that advertise heavily have been investigated because they accept any idea that comes through the door, they make all their money in upfront fees, and they do little or nothing to market the products. Unfortunately, inventors lose good ideas and good money that way. Q: How do people submit their ideas to your Toy Search? A: Visit the Web site or call us at 800 678-8972 and we'll send them forms on which they can submit their ideas or products. If we see some potential there, we'll make them a licensing proposal and see where it goes.  Karen E. Klein is a Los Angeles-based writer who specializes in covering covered entrepreneurship and small-business issues. Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | JUNE |
 Copyright 2003, by The McGraw-Hill Companies Inc. All rights reserved.Terms of Use | Privacy Policy |
Printer-Friendly Version
