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Augmented Reality & the Toy Business: Opportunities Ahead

Augmented Reality & the Toy Business: Opportunities & Limitations

Augmented reality has been around for quite a while, dating back to at least the late 1980s in a technically limited format of course. The best-known iteration of augmented reality in the world of kids and entertainment is of course Pokémon Go, with more than 1 billion downloads. During the peak of Pokémon Go, people around the world were randomly wandering around trying to find Pokémon characters. There are many theories about why this iconic A.R. experience became so popular, but the combination of a highly collectable set of characters and ‘secret’ characters spread about the real world which nobody else can see were clearly completely compelling.

Obviously, sales of Pokémon toys & games, especially the collectable card game, soared alongside the success of Pokémon Go, yet augmented reality remains only an occasional feature/add on for toys. Why is that then, and where do the opportunities lie with this technology?

Looking back to Skylanders which between 2011 and 2016 was phenomenally successful in terms of integrating toys and interactive play experiences (albeit via different technology) it is abundantly clear that merging toys and interactivity together can be very compelling. The challenge though with Skylanders was that the game format relied on a fully developed video game experience which is a $multi-million development cost way beyond the reach of 99% of toy companies, and those toy companies who could afford it were themselves badly burned by failed explorations into the world of video games.

Where augmented reality toys offer much broader opportunity is in the far cheaper development costs. Whereas a full video game development budget would be $millions or even tens of millions, an augmented reality app & integration for toys is likely to cost thousands. When you consider the cost of tooling on a toy product line can be $tens of thousands for even something fairly simple, and when you consider marketing budgets of 5-15% of sales value, it is perfectly clear to see that augmented reality can be implemented with toys easily either via the product development or marketing budget. Why then don’t more toy companies use augmented reality in their products?

The toy business is not often quick to adapt. In an industry where many product formats have not really changed over decades, the culture and management ethos of many toy companies is more backward looking than forward compared to many industries today. If you can sell perfectly good quantities of toys without investing in extra funds in interactivity, why wouldn’t you? The answer of course is new opportunity.

Augmented definition: “having been made greater in size or value.”

Adding augmented reality can make some play experiences more compelling, and that in itself should be enough to ensure toy companies at the very least evaluate what A.R. can do for their products.

The reality is that many toy people look at toys with augmented reality as gimmicky, but as with every technology implemented within the toy business the point is to make the play value greater – to augment the experience.

There are some clear areas of opportunities within the toy business from A.R.:

Firstly, the area of ‘edutainment’ is worth considering. While children naturally tend to want to learn, some topics are more interesting than others. Technology which brings stories, scenes, people and things to life can be of serious benefit. For instance, a science kit could have an add on of an augmented reality Albert Einstein, Newton or Edison, but it could also have an A.R. representation of the human body, a map and so much more. This seems to be one of the most promising areas for augmented reality in toys.

One of the most powerful impacts of technology is to bring toys and toy characters to life. Augmented reality can certainly offer a lot in terms of deepening immersion and interaction with particular characters.

Social play experiences i.e. board games can be enhanced by A.R. – Spin Master’s Hedbanz game would be a good example of this. The player might be wearing a pig on their head but add an app with A.R. and suddenly the player also has a massive hilarious pig snout.

There are many opportunities with A.R., and of course the technology is only going to get better, with more wearable tech solutions on the way to offer huge opportunities for play integrations with toys.

This article was inspired by our interview with Wikitude, a leading Augmented Reality company, for our Playing At Business podcast to be released soon.

 

Can we help you better understand how to get ahead in the toy business? We offer a limited number of one-off toy business consultancy calls where we can run through your sales plans, review & feedback on your products, share knowledge & insights on the global toy & games business, as well as share key contacts from across the toy business. If you are interested in this service, find out more here: https://kidsbrandinsight.setmore.com/

Have you listened to our Playing At Business podcast? We analyse key product categories in the toy business, discuss key trends and interview amazing people from across the world of toys. To find out more: www.PlayingAtBusiness.com

 

The U.S.A.: How To Enter The Biggest Toy Market In The World

The U.S.A: How To Enter The Biggest Toy Market In The World

The U.S. toy market is unlike any other. Aside from the fact that it is by far the biggest market in the world for toys & games, it is also home to two of the worlds biggest toy & game retailers, as well as thousands of independent ‘Mom & Pop’ specialty stores. Any international company looking to grow export sales has to have a plan of attack for the U.S. toy market, because it is by fear the biggest opportunity they have.

There are many challenges though. Let’s take a look at some of these before we look at solutions:

  1. Geographic size – the U.S. is not just huge as a market, it is also physically huge, making logistics a major challenge – both in terms of internal transit time, but most importantly in terms of cost.
  2. Inaccessible mass market retail – major retailers like Walmart & Target are not keen on adding new suppliers, their metrics are driven by reducing suppliers normally, not adding more.
  3. Legal & tax framework – it is usual to have to adapt to local laws, company structures and tax regimes in entering new markets. The U.S. has some very rigid laws and regulations.
  4. Finding 3rd party distribution can be difficult – there are several reasons for this, but basically there are fewer distributors than in other markets. In many markets it does not make economic sense to tool up toy products for just the home market, so from the very start most non-U.S. companies are thinking about selling for export. In the U.S. however, the size of the market means that product development just for the ‘local’ market is obviously viable – therefore it is easier to justify product development, and so most companies would develop their own products to make much higher margins. As a result, whereas many international companies develop some of their own products & distribute a lot more for other overseas companies, in the U.S. this is less prevalent.

There are more challenges of course, but there are enough listed above for consideration.

The question then is how to get to market in this massive but challenging market? When we look at distribution options there are actually a limited number. Here they are (listed in order of least risk/least work):

  1. Distributor model – while there are fewer distributors in the U.S. than in many other markets, there are still a few really good (and some very average) distributors. The obvious advantages of the distributor model are that they take the stock risk, and pretty much do all the work. The primary risk is that they do a bad job with your products and sully the biggest market for you going forward.

 

  1. Sales rep model – due to the size of the U.S. landmass, the sales rep model is most common. Often reps will cover a couple of states, and so a network of sales reps, or a national sales rep company can give you access to an ongoing raft of purchase orders from retail with minimal leg work & staff overheads on your behalf. The challenge is that some reps are better than others, and if you have a product which is not an easy sell, they are likely to push harder on easier to sell products as they don’t get paid unless they sell something. And of course you still have to process and fulfil the orders, take responsibility for marketing and anything else not involved in the sales process.

 

  1. Direct to retail – some companies resent paying rep commissions and seek to sell direct from the start. This is a hard but perhaps ultimately rewarding path. For most companies we would not necessarily recommend this due to the time needed to set up distribution this way versus instantly accessing existing sales relationships via sales reps.

 

  1. Direct to consumer – this model is not new – mail order and TV shopping have been around for a long time, but the internet has allowed direct to consumer sales models to ramp up considerably. Arguably Amazon as one of the biggest and fastest growing major retailers is as much a direct to consumer selling platform as it is a true retailer in the traditional sense. We see a lot of start up companies or Chinese factories trying to use Amazon but not getting much success – Amazon is a system based on algorithms, and so to be successful you need to know how to best manage the algorithms.

 

So, there are many ways to sell to the U.S. toy market, but each comes with challenges, opportunities and risks. Prudent analysis, and above all choosing the right distribution model is required to achieve sustainable success.

 

Do you need help to grow sales for your toy company? We help people from all around the world to sell more toys, both in their home markets and into export markets. For more information on how we do this, check out our services here: www.KidsBrandInsight.com/services

 

Have you listened to our Playing At Business podcast? We talk about selling toys & games, interview successful people from across the toy business & we look at key trends in the toy & game business: https://playingatbusiness.libsyn.com/

 

 

 

How To Sell Toys

How To Sell Toys

For some people selling comes naturally. For others it takes hard work to develop the right skills and attributes. Effective salespeople in the toy business tend to be persuasive, not easily discouraged, are normally great networkers, tough enough to manage the hard commercial situations and tough buyers you find out there in the cutthroat world of retail and last but not least, are normally excellent at distilling down product benefits and points of difference/advantage to a quick sentence or two.

These attributes can be learnt or adopted with practise by nearly anyone. After that there a number of simple tactics which tend to help to sell more toys in an industry where there are often literally tens of thousands of competitive products to pitch against:

  1. Don’t be just another salesperson doing just another sales pitch

Unless you have the biggest most iconic toy brands, or unless your marketing spend is huge, you really don’t want to be just another salesperson doing a ‘same, same’ sales presentation. Think of it this way the buyer probably has at least dozens, if not 100 plus salespeople trying to contact them in some instances. You have got to be exceptional if you want your company and your products to get exceptional attention and action i.e. more listings for your products.

  1. Find a way to be not just another product

Retail buyers routinely review tens of thousands of products every buying cycle. Unless you have the biggest most iconic toy brands, or unless your marketing spend is huge, you really don’t want to be just another product, because many more products are not selected versus those which are chosen. There are a number of ways you can try to be not just another product – start with your competitive positioning/differentiation analysis, how is your product different or better versus all the competition? How will your products deliver a better experience for consumers? How is your product more likely to sell off the shelf/e-commerce platform versus all the others? Can you use narrative & story telling to make your product seem special, like it has huge momentum and potential? If you can’t you had better have all the attributes of a good salesperson listed in the opening paragraph above, because you’ve got a tough gig!

  1. Get the buyer to tell you why not if they won’t take your products

Experienced sales people are used to the bubble of preview season, whereby buyers tend to react positively to your products, because after all they probably are good. But then when the buyers go back to their office, something happens to dampen their enthusiasm, and you don’t end up with quite as good a set of results as you expected from the positive vibes you received. This is because the job of the buyer is to distil and dismiss products down from potentially many thousands to a more limited selection driven by shelf space/focus & other metrics. Sometimes you have good products but they just don’t make the cut. But the key is to get as much feedback as possible as to why your products were rejected in the end. Because this shows you a). where the buyer’s preferences are for future reference/exploitation b). gives you insights from expert eyes on why your products are not stacking up above your competitors c). if the buyer tells you what they are looking for, and you come back with what they asked for, there is much more chance they will take the product.

  1. Use social proof – demonstrate your success elsewhere

The concept of social proof is based on the premise that people often don’t want to be first to do something, but they will often follow the crowd when others are doing the same thing. For instance, one of our team tells a story of presenting a new product to a well-known retailer, and the buyer’s feedback being “If our competitors take the product, we will”. In many ways online reviews are the ultimate in social proof, but the same principles sometimes apply to toy buyers. The principle of social proof also applies to selling to distributors, often people don’t want to be the first person to sell your products, but if you can show them a track record of success in other countries it will help to persuade them.

  1. Be relentless in your follow up (in a non-annoying way)

The buyer is not necessarily ignoring you, it’s just that you are one of many trying to speak to them, aside from the many (often pointless!) internal meetings they will be taking part in. Here’s the reality of selling to retail buyers – unless you are a major supplier like Hasbro or Lego, whose sales teams will probably be communicating with the buying team frequently – you will actually not get much interaction or time with the buyer. You may get to present your products just once, or if you are lucky, maybe twice, and on that minimal contact your entire year’s success or failure may depend. You may even get to talk to the buyer on the phone once or twice, but you will be lucky if you get any more interaction than that. So, if you need to speak to the buyer, you need to be relentlessly persistent (in a non-annoying way) to get some of their time instead of the dozens of other smaller suppliers trying to grab some of their time. They aren’t being deliberately rude, it isn’t because they don’t like you or your products, and it isn’t some kind of conspiracy to keep you out of the toy business! It is just hard to give you much time due to the nature of the toy business, the many products and many suppliers. So, the bottom line is to be successful you need to crack on, not give up and to be relentless in a way which does not come across as annoying, psychopathic or unprofessional.

 

Do you need help to grow sales for your toy company? We help people from all around the world to sell more toys, both in their home markets and into export markets. For more information on how we do this, check out our services here: www.KidsBrandInsight.com/services

 

Have you listened to our Playing At Business podcast? We talk about selling toys & games, interview successful people from across the toy business & we look at key trends in the toy & game business: https://playingatbusiness.libsyn.com/

Ongoing Global Chip Shortage: Analysing The Effect On The Global Toy Business

 

Ongoing Global Chip Shortage: Analysing The Effect On The Global Toy Business

There is currently a major global shortage of chips required to make high end electronic items. Major consumer electronic companies are struggling to supply to demand due to the shortage – for instance, Samsung are reportedly reviewing their new phone launch plans, new gaming consoles from both Sony and Xbox are also badly impacted. Analysts are suggesting that this shortage is going to persist at least through 2021, and most probably into 2022. New chip factories are probably on the way partly due to rising demand, but also due to geopolitical security concerns – so much depends on the supply of silicon chips these days that any supply issue can quickly become a national security issue. New factories though take up to 2 years to build, set up and ramp up, so there is no immediate solution on the horizon.

The reasons for this shortage are classic supply & demand, and don’t really concern us here. What we are interested in though is the impact of the chip shortage on the toy business. Here’s our analysis on this:

  1. Console & games sales will be negatively impacted – historically speaking, new console launches nearly always negatively impact the toy business as consumer spending is diverted to pay for new consoles and then typically an extensive array of games. When supply is restricted on or around a new launch three things tend to happen a). immediate and ongoing spending go elsewhere and often don’t come back b). pricing goes up to sometimes ridiculous levels pricing many families out c). game developers don’t buy into the new platform to the degree they would have if supply were plentiful – because video games development costs a lot of money, and every new version costs even more. Now the reality is that major gams developers will still have to develop and launch games for new consoles, but they will tend to need to pair back spending if the instal base of the console is not that high. The bottom line on all of this is that whereas new console launches normally herald negative sales impact on the toy business, the chip shortage should significantly reduce that impact.

 

  1. A limited number of top end electronic toy products will also suffer supply issues – thankfully the vast majority of toys sold have no electronic components, and even fewer feature the chips which are now in short supply. This may hamper some companies more than others and may lead to the postponement of some upcoming new launches at the high end of the toy market. One of the issues for toy companies affected is the lack of leverage versus the major consumer electronics companies whose volumes and spend are so much greater, and who will therefore be more able to secure available supply.

 

  1. Tablet & Phone sales will be impacted – any children looking to get a new phone or tablet will find that supply is not as strong as it normally would be, which generally speaking could be expected to drive up pricing. Again, without going into all the details of how phones are made and the important role that chips play, the bottom line is that of supply of these high-end gadgets is restricted that should act to increase demand for top end, higher price point toys.

 

So overall it is hard to see how the global chip shortage can be a bad thing for the toy business in 2021 overall. There may well be some repressed demand for consumer electronics heading into 2022, and that could act as a drag on toy sales, but for now, the situation seems to be a potential positive for the toy industry in 2021.

 

Can we help you better understand how to get ahead in the toy business? We offer a limited number of one-off toy business consultancy calls where we can run through your sales plans, review & feedback on your products, share knowledge & insights on the global toy & games business, as well as share key contacts from across the toy business. If you are interested in this service, find out more here: https://kidsbrandinsight.setmore.com/

Have you listened to our Playing At Business podcast? We analyse key product categories in the toy business, discuss key trends and interview amazing people from across the world of toys. To find out more: www.PlayingAtBusiness.com

 

 

 

 

 

 

 

 

 

Lego Announces Annual Results – Analysing What’s Going On With Lego

Lego Announces Annual Results – Analysing What’s Going On With Lego

As financial results season draws to close, there was one big player yet to report how 2020 panned out for them – Lego. Even though they don’t really have to report very much in terms of their annual results (because they are a privately owned company), there were a few big reveals in their 2020 full year results which merit some thought and consideration:

  1. Revenues were up double digits in 2020

This is perhaps the least surprising part of the announcement from Lego. We already knew that toys delivering parent approved play patterns were tending to be up considerably year on year. Lego reported revenues increased by 13%, with consumer sales up 21%.  So, Lego did well out of locked down families just like many other parentally approved toy brands.

 

  1. The Digital space is a major focus

Lego are firmly planted in both the physical and digital worlds these days. This announcement made clear just how important digital experiences are to Lego, both in terms of integration with Physical products (i.e. the best-selling new release was Super Mario Lego featuring an App integrated into the play experience) but also in terms of delivering entertaining, compelling and sales creating online shopping experiences. Lego are in the process of recruiting teams of new people to help them to expand and deliver their digital visions.

 

  1. Lego’s promise to produce bricks made from fully sustainable materials by 2020 is a strong and financially committed goal

Lego has committed $400m USD over 3 years to developing sustainability initiatives, including developing sustainable plastic alternatives which can be durable in the same way as plastic Lego can be, using paper bags for instructions and parts versus plastic and more. For this Lego should be applauded. Perhaps this is the benefit of being privately owned, because it would be hard for stock market listed companies to earmark such a large amount of money towards something offering no clear short term payback.

 

  1. Lego has a hefty product development churn each year, but this is less wasteful than it may appear to be

One of the most surprising parts of Lego’s announcement was that 55% of the product portfolio for 2020 was new! Typically, the toy business sees around 60-70% of toys on sale being new each year, so clearly Lego is ahead of the crowd in this regard, but at first glance it is perhaps surprising that they don’t manage to keep sets in the market for longer. The reality though is that Lego’s unique parts system means that while the theme, imagery on the box and instructions may be different on each ‘new’ set, the vast majority of the pieces inside are used in numerous other products.

 

  1. Lego is growing their retail portfolio, especially in China

Lego now has nearly 700 stores worldwide, with a whopping 250 of them in China. Because China’s consumer culture is relatively new, Lego clearly feel the need to find ways to engage with Chinese consumers to ensure the brand has just as prominent a position in the world’s 2nd biggest toy market going forward as it does in pretty much every other country in the world!

 

  1. Lego’s top selling themes in 2020 are unsurprising

If you had to guess which Lego themes would be most popular every year, most of the time we suspect the answers would be at least partly the same: Lego City, Lego Star Wars, Lego Friends, Lego Classic & Lego Technic are all well-established sub-brands based on a deep understanding of the target consumer base for each. This consumer segmentation is one of the most successful features of Lego’s brand strategy and is something many toy companies could learn from.

 

There are very few toy products or brands which manage to be loved by parents and loved by kids alike in the same way as Lego is. Lego is in the end just one brand, but within that brand and all the brand extensions and sub-brands, Lego has enough to be the biggest toy company in the world, and looks set for future growth.

 

We often use our analysis of the reasons for Lego’s success in our Consulting with toy companies. We have consulted with more than 100 toy & game companies and use our knowledge of Lego and many other successful toy brands and products to help up and coming toy companies raise their game. For more information on what we do and how we help: www.KidsBrandInsight.com/services

Have you listened to our Playing At Business podcast? We analyse key product categories in the toy busines, discuss key trends and interview amazing people from across the world of toys. To find out more: www.PlayingAtBusiness.com

 

 

Why Seeking Alternative Toy Distribution Is Often A Missed Opportunity For Toy Companies

Why Seeking Alternative Toy Distribution Is Often A Missed Opportunity For Toy Companies

Selling toys to retail is hard. It’s hard for one major reason – the level of competition. Spielwarenmesse, the world’s biggest toy trade show, held (normally!) every year in Nuremberg, Germany estimates that there are 1m toy products on display at that show. And that isn’t even every product that the exhibitors run. There are literally millions of toy products on sale each and every year.

What this means in practical terms is that for each and every product you want to sell, there are dozens, maybe even hundreds of other products trying to get on the same retail shelves and trying to get prominence on the same e-commerce platforms. The toy business is one of the most ridiculously competitive businesses out there. Every time you preview your products to a retailer at a trade show you are fighting for attention versus literally thousands of other products they have seen.

Aside from the competition though, another major challenge is that retail buyers come to know their categories really well. They develop very fixed ideas of what works in terms of products, packaging and price points. If you have a product which sits outside there view of what toys in their category should be, then selling becomes really hard.

None of this should be news for anyone who has ever tried to sell a product to retail. But what is remarkable is how few toy companies put serious effort, resources and opportunity cost into breaking out of the shackles of the normal system of doing things. The world has changed so much, yet for many toy companies getting up to speed on Amazon & how to market & sell on social media is their primary adaptation.

One fundamental insight which we see time and time again is this – why would you spend all your time and efforts trying to be one of many products in traditional toy retail when you could try to be one of one via non-traditional outlets?

There are so many good examples of how to do this – we’ve seen companies running corporate gifts using personalised versions of classic toys & games – for instance, the board game Monopoly is offered in customised ‘special editions’ in various countries around the world. Or maybe it’s a bespoke product created specifically for a particular company, brand or organisation. It might be just selling a product with a particular theme to retailers you (& all your competitors) don’t normally sell to.

Another example of non-traditional retail is the educational sector. Although this comes with a minefield of bureaucracy and unclear purchase responsibilities, the education sector is not as price sensitive as retail. Often the person buying toys & games is also buying other forms of equipment, so they aren’t experts in the space. Moreover, they aren’t needing to buy at the best possible price so that they can make a profit, they are instead just spending a budget that is given to them, and while schools and educational organisations are often working on tight budgets, their purchase managers quite frankly lack the commercial ‘smarts’ and hard-nosed approach of retail buyers.

So, next time you come back from a retail meeting wondering why this has to be so difficult, why not try to sell into some greener and untouched pastures?

 

Have you listened to our PLAYING AT BUSINESS podcast? We analyse key areas of the toy and game business, we interview leading people in the business and we discuss major trends and changes across toys & games. You can listen to numerous episodes here: https://playingatbusiness.libsyn.com/

For more articles & insights on the toy and games business, sign up here for our free e-newsletter sent straight to your inbox: https://forms.aweber.com/form/54/1325077854.htm

 

The European Toy Market, A Practical Overview

The European Toy Market, A Practical Overview

Europe has just under 10% of the world’s population, approximately 16% of the world’s GDP (just a little bit less than the USA & China) and more than 50m children. Europe therefore represents a significant commercial opportunity for those in the toy business – the market size is in excess of €18billion.

The challenge of course is that Europe is a more complicated region in terms of disparity and local language and cultural difference. Europe has 44 sovereign states and 24 official languages, and so it is a complicated place to try to do business. Most of Europe’s nations are part of the European Union, a political and economic union bringing together 27 countries. European law stands above local national law for members of the European Union. The EU nations use the €uro currency which is used as the national currency in 19 countries. Before the €uro was established setting pricing for European markets was a nightmare, as local currency fluctuations made it exceedingly difficult to fix a price that worked across markets. This was further complicated by one of the primary treaties of the European Union – namely The Treaty of Rome which legislated for free movement of goods across the zone.

Practically speaking The Treaty of Rome causes a lot of problems for those trying to patch together a network of distributors across Europe, as it is all too easy for them to effectively ‘steal each other’s lunches’ by selling into customers in each other’s markets. When talking to potential new distributors in one European country one of the first question’s they will ask is who is distributing for you in the other markets – because from this they can work out how big a challenge they will have with cross border shipments. The massive growth in Amazon’s power in the market has exacerbated this, with Amazon being a major opportunity as well as a major challenge for efficiently running a Europe wide business.

One of the most effective ways to enter the European toy markets is to work with distributors. There are sales reps in Europe, but they tend to work in only one or two countries at a time, and with each country having various differences in culture, law and distribution channels there is a lot of complication involved in trying to sell via reps across the whole of Europe. Distributors take away a lot of the workload, but on the flip side also take away margin from your bottom line!

There are some extremely valuable trade shows in Europe. Firstly, Spielwarenmesse, the biggest toy trade show in the world is held in Nuremberg, Germany at the end of January every year (in normal circumstances): www.spielwarenmesse.de. This massive trade show features nearly 3,000 toy companies from all around the world. There is no better place to get an idea of the European toy market and to seek commercial opportunities. In addition, Distoy takes place in London, England every May (again under normal circumstances), this less well-known show is a show specifically for toy distributors, and with over 400 exhibitors much business is done here: www.Distoy.com. There are also national shows in other markets in Europe, which may be of interest to attend if you are particularly focused on that country. But overall, if you had to attend one trade show to maximise access to the European market it would be Spielwarenmesse.

The biggest toy retailers in Europe (in no particular order) include: Smyths Toys/Toys R Us, Carrefour, Auchan, Argos, Amazon (of course!) and there are thousands of independent toy stores across Europe.

By far the biggest toy markets in Europe are the UK, France & Germany. Even within these 3 markets there is a massive disparity in terms of products, culture and retail structure, as well as 3 different national languages. The UK tends towards more licensed toys, having one of the highest market shares in the world for licensed toys, whereas Germany has one of the lowest market shares for licensed toys in the world. The UK and France toy buying structures tend to be centralised with a central buying team, whereas Germany is very fragmented and buying (or at least replenishment) is often more localised.

Warehousing can be a challenge also in Europe. Many companies will have just one central warehouse, often in Belgium or the Netherlands. Brexit has complicated the logistic situation somewhat (damn we knew we had to mention Brexit at some point!), because there are new rules & restrictions on trading between European Union countries and the now ex-EU country of Britain.

Compliance and safety regulations are demanding in Europe. Whereas the USA has ASTM standards, the European Union has EN71, a massive set of restrictions and mandatories that even teams of experts often can’t easily understand! Going forward the UK will have its own (different) standards. We highly recommend specialist expert help in the area of compliance for Europe for toy companies!

The final complication we are going to mention here is that of trying to supply your products in the right language versions, but with as much efficiency as possible. The more countries you can ship the same product version to the better and more efficient your inventory control will be. For some products this is less of an issue, for instance, basic plush might only need a label with brand name and a few other company details which can be shipped right across Europe. For other categories though things can get more complex, board games for instance are often language-based products with significant ‘content’ on cards which is integral to the play experience. This means that often different language versions are needed for each new country. With time though you learn that some countries will need dual or even tri-language packaging. In some cases (most notably Eastern Europe) there might be the need for a dozen or more languages to be somehow included in the product. Sometimes things can be simplified though, for instance in Scandinavia the level of English spoken is so good that sometimes board games companies can get away with supplying English language product with local legal lines & instructions, normally though this risks reducing the amount of sales achieved, so there is a trade off to be made for simplification.

So overall, there are many challenges involved in selling across Europe, but it is also a strong and vibrant toy market, with many great people working in it, and with consumers who love toys and see them as an integral part of childhood.

 

Our team has been working across the European toy and game market since the end of the last millennium. We have sold products into every country in Europe, and regularly help toy & game companies access the European toy market. For more information on our Consultancy services: www.KidsBrandInsight.com/services

For more articles & insights on the toy and games business, sign up here for our free e-newsletter sent straight to your inbox: https://forms.aweber.com/form/54/1325077854.htm

How To Start A Global Toy Craze With Choon Ng of Rainbow Loom

How To Start A Global Toy Craze With Choon Ng of Rainbow Loom

In the latest episode of our Playing At Business podcast – http://www.PlayingAtBusiness.com – we talk to Choon Ng, the creator of Rainbow Loom. Very few people get to say they started a global toy craze, but that’s exactly what Choon did when his Rainbow Loom products took the world by storm and kickstarted the ‘Loom Band’ craze.

In the interview, Choon talks us through his amazing roller coaster journey as he took the company from one product start up to a massive global success in a short time. We discuss how he handled the business as it grew meteorically and how he managed distributors around the world, as well as a host of knock of ‘me too’ products which soon came onto the market.

We also talk through how Rainbow Loom is still providing a compelling play experience for children around the world.

To listen to this podcast interview, just click HERE

 

We run a Consultancy business for toy & game companies. We work with major toy & game companies through to start ups and one person bands. For more information on how we help toy & game companies grow their distribution around the world: www.KidsBrandInsight.com/services

For more articles & insights on the toy and games business, sign up here for our free e-newsletter sent straight to your inbox: https://forms.aweber.com/form/54/1325077854.htm

Will The Ongoing Artificial Intelligence Revolution Revolutionise The Toy Business? And In What Ways? Part 2 of 2 – PRODUCT

Will The Ongoing Artificial Intelligence Revolution Revolutionise The Toy Business? And In What Ways? Part 2 of 2 – PRODUCT

In the last article on this topic we looked at how artificial intelligence (AI) will revolutionise work and society over the next 10 to 20 years. In this article we will look at what AI means for toy products. Or to put it another way, how can AI help us create even more compelling play experiences and even more desirable toys?

This question has a very simple answer – AI can help us to create more compelling toys by making the toys more interactive, more lifelike and ever more tailored to the child’s wants and needs.

The best way to think about this is to look at how children interact with animals like cats and dogs. They tend to form a strong bond with their pets, but their interaction with the animal is often frustrating from both sides – the child finds that the pet won’t do what they want, and the pet finds the children often heavy handed and over-bearing. While kids will find animals super cute or hilariously funny, the actual relationship with them is not always as strong as it might be.

Toys such as Furby (mk 1) brought toys to life and helped kids by giving them a ‘pet’ which was entirely designed around their experiential needs. By putting a furry outer layer on some technology the toy was ‘brought to life’ and to a very basic degree made interactive. Furby (mk 2) stepped this up, and just by looking at the packaging which listed multiple patents contained inside, it became obvious that this was a new type of toy – one which was featuring tech not previously utilised in toys. But even then, the level of interaction was still kind of basic.

Where A.I. is headed in general is not entirely clear, but as far as toys are concerned the destination is already quite clear: kids don’t care about the complexities and technicalities of technology. They care about the toy, the experience and the level of interaction they can have with a toy. A.I. will allow toy companies (or tech companies) to deliver the kind of lovable friend kids would really want. A.I.’s most basic function is to learn & adjust its functions accordingly, and so by learning what the child likes and doesn’t like, and by constantly assessing the child’s actions, the toy can tailor what it does and how it does it to the child. Let’s say for instance the child is obsessed with sports, or is scared of something, then the toy can help them through that experience. If you think of everything the internet can do for us today, from searching for data or documents, planning a route to a destination, to entertaining us, teaching us and so much more – well all this can be delivered by the toy.

Think about everything we use Alexa for today. Then consider that Alexa is only going to get better, because everyday millions of inputs, requests and queries go into the A.I. behind Alexa, and so Alexa learns and gets better and better over time. The same will happen with A.I. toys.

Now the reality is that the toy business is actually a relatively minor one on a global scale in terms of technological development. Therefore, Google, Amazon, Elon Musk & other tech luminaries are not staying awake at night trying to work out what toys to make next and what technology would enhance the play experience. But what they are doing is constantly developing new technology and A.I. to constantly improve things. The toy industry has always been adept at launching new toys featuring technology invented elsewhere and for different reasons.

That is the really exciting thing about A.I. for toy companies – the options are growing exponentially, but these types of products take more investment than another lump of mechanical plastic. The toy business is never going to be cutting edge, but by using the technology of yesterday we deliver the toys of today, and yesterday’s technology has never been more powerful, advanced and affordable.

Toy companies who learn to cost effectively harness A.I. and to deploy it into creating and delivering to market compelling toys and great play experiences will enjoy great success over the next decade or more.

 

We run a Consultancy business for toy & game companies. We work with major toy & game companies through to start ups and one person bands. For more information on how we help toy & game companies grow their distribution around the world: www.KidsBrandInsight.com/services

For more articles & insights on the toy and games business, sign up here for our free e-newsletter sent straight to your inbox: https://forms.aweber.com/form/54/1325077854.htm

 

How To Start A Successful New Toy Or Game Business

How To Start A Successful New Toy Or Game Business

New toy companies are the lifeblood of the toy business. Unencumbered by decades of the right way of doing thing and understanding what works and what doesn’t, new companies push the boundaries and update thinking about what works as a toy as society and technology evolve over time.

For many of us old hacks who trudge around the same old toy trade shows every year, part of the joy of these shows is seeing what new companies have thrown their hats into the ring. Sometimes a company has so blatantly got it wrong that cynics doubt if they will last until the next toy trade show, others manage to uncover new hot concepts and product directions to the extent that they have distributors and retailers hanging around their exhibition booths like flies, along with all those who will be off to the factory soon after to try to copy the new idea from the new blood!

The journey for a start up is normally difficult, gruelling and fraught with banana skins and mistakes. Via our consultancy business www.KidsBrandInsight.com we have consulted with many dozens of start ups (some clients have described us as toy start up experts). We find that the same key areas define success or failure each and every time.

We recorded an episode of our toy & game business podcast: www.PlayingAtBusiness.com looking specifically at how to successfully start a toy company. Toy start ups are common, but not all of them make it. We cover what separates the successful companies from those that don’t make it on this podcast episode:

https://playingatbusiness.libsyn.com/how-to-start-a-successful-new-toy-business