Artificial Intelligence: How It Will Affect International Distribution For Toys & Games?
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These are incredible times we’re living through. If artificial intelligence has not yet started to considerably affect your work, then you might want to put your head outside of your bunker!
I watched a Video recently about how quickly AI is advancing, and the speaker highlighted that A.I. large language models like Chat GPT et al currently have an equivalent IQ of about 120, which is higher than the average human – most people have an IQ between 85 and 115 apparently, so we’re already looking at something that is on a par or a bit more intelligent than most human beings. But the speaker went on to say that these large language models now have an IQ of 120 on pretty much everything that humans have ever known, which no human could get anywhere near competing with.
Oh and by the way, I watched this video about a month ago, so the 120 IQ is already higher than that…and in 5- or 10-years time we’ll be looking at an intelligence so far beyond human intelligence that there is no meaningful way to quantify it or compare it with humans.
But aside from the massive societal, ethical and existential questions that raises, professionally we are all trying to embrace and adapt to these incredible new tools that have been placed in our laps, we are also though already having to manage considerable change.
The question is what are the specific implications for the Toy & Game business. This article will look at how A.I. will impact selling your products overseas, and later articles will look at other parts of our business that will be disrupted.
THE TRIPOD OF INTERNATIONAL SALES FOR TOYS & GAMES
There are three key elements to successfully selling your Toys & Games into international distribution:
1. The product
2. Knowing who to sell to
3. Human connection, interaction and trust.
Let’s run those one by one:
1. THE PRODUCT
There are a few rare individuals who can get away with selling crappy products year after year because they are so good at the process of selling, but there are not many of them. The Toy & Game business is a product driven business, and products are in abundance, therefore having a product which has a compelling proposition for distributors, retailers and consumers around the world is critical.
We’ll look in more detail in subsequent articles about how A.I. is impacting the product development process, but from the perspective of international or export sales, the major impact of A.I. is as a research tool for both product development and sales people. Whereas once you maybe would have to send a letter, and then eventually could make a phone call, or could visit an annual trade show to find out about local product culture in different countries, now Large Language Models (LLMs) make that process really easy. You can literally just type into one of these LLMs your query and get an ever increasingly better answer. Maybe you won’t get quite as good an answer as the top people in the local market could give you yet, but it’s still remarkably good.
So before you even make a product you can investigate cultural fit and try to analyse how likely your product is to resonate in certain key markets to a level far higher than ever before, even on a global level. That’s all without leaving the office!
2. KNOWING WHO TO SELL TO
One of the biggest insider advantages in this business of Toys & Games is knowing who to sell to. It’s knowing which potential partners have good reputations and which have bad ones, it’s knowing who is more likely to be a good fit with your product based on years of experience and learning.
LLMs make one part of that process so much easier – when I first used these systems to research distributors and retailers, the response was kind of useless, it would mix up retailers with distributors, and not provide meaningful, helpful information. Now the quality of answer is really helpful and getting better every day.
So I would say that the era of knowledge-based business advantage creating a ‘Moat’ around your company or around your advantage is nearly gone and will soon likely disappear.
Currently the LLMS I am using are not that great at finding the exact right person to talk to in a company, but that will inevitably come very soon.
The part of knowing who to sell to that LLMs will find much more difficult is our knowledge of personalities and behaviours of key individuals within an organisation. For example, one of the distributors I have known for a long time has two key contacts to submit new products to: the Managing Director/Owner and the Purchasing Manager. It’s the job of the Purchasing Manager to buy in new products for them to distribute, but basically this guy is so inundated that he is very unresponsive, and I am sure doesn’t even look at a lot of communications, he certainly is not communicative back. Now ideally of course you want to pitch new products face to face to try to influence the person with your amazing selling skills and loveable personality (!), but the issue is that in reality we can’t always do that on every project/every product. Because I know how the company works, I understand that if I send a new product or product line direct to the Managing Director, he will just forward it to the Purchasing Manager…BUT critically, the Purchasing Manager will then have to pay it some attention because it was sent to him by his boss, and so he will want to at least have a valid reason for not choosing that product, so he will inevitably have to seriously look at the product or the email. And if the product is compelling, he is therefore going to notice and is more likely to buy the product in to distribute, or on a more micro level is more likely to respond to my query.
Now that’s a very elongated example, but that’s the point…for as long as buying decisions are made by humans, human factors will apply, and as we all know, humans are not entirely rational, there are all kinds of crazy emotional and social factors in human decision making. AND, that’s the part I can’t see LLMs eradicating in a hurry.
3. HUMAN CONNECTION, INTERACTION & TRUST
As the saying goes, people buy from people. In a world where there is a mass of products to choose from, some of what influences the buying decisions are human factors. This isn’t just who your customers like on a personality basis, it’s also about how much they trust you and your company to deliver what you say you will deliver and to help them resolve over stock issues or retailer complaints. In effect, by agreeing to distribute your products, your international distributors are placing their hard-earned customer relationships at jeopardy because they are placing their faith in you and your company to deliver for them.
There is no doubt in my mind that A.I. can and will develop a very persuasive way of interacting with humans, because it can easily work out what is effective and why it was effective, and eventually will learn to manipulate humans into changing their behaviours, but what is much harder is actually building real trust from A.I.
Here’s a story I tell a lot (apologies if you’ve read or heard me say this 10 times before), I pitched a product to a distributor the first time I met him, and he really liked it and wanted to run it. But there was always a reason not to, always something else that seemed a bit more attractive. And so I went on presenting this same product to the distributor for 7 years until eventually he went ahead and decided to run the product, which was a great success for him. Now you could argue that it took 7 years to persuade him to sell the product due to my failings as a sales person. But other people bought the same product in Year 1. The issue with this guy was that he didn’t know me, and so while he liked the product, he didn’t trust my ability to deliver it to him with no manufacturing problems, safety infringements or customer service delays which would have damaged his precious customer relationships.
Again, I’m not sure how A.I. would have made that sale…it could have logically outlined the benefits of the product, but how would it persuade that guy to take the leap of faith that was built up over 7 long years?
CONCLUSION/NEXT STEPS
Let’s face it, we’re all kind of screwed…LLMS and other forms of A.I. are going to get so good that we are at great risk of becoming both redundant and sidelined in terms of commercial operations. The only question though is how long is that process going to take, and how do we with our more limited intelligence direct and harness this soon to be much greater intelligence to drive our careers and businesses forward?
As I see it, there are two critical elements to your ongoing success across the next wonderfully exciting but also somewhat terrifying decade:
1. Focus on meaningful human connection – this is still our massive advantage. People buy from people, AND anyone who has been around the block a few times in this business knows that you can’t accurately predict what crazy humans will buy using intelligence!
a. The one thing that A.I. is not is human. It might be way smarter, more efficient, cheaper and all of that, but it ain’t a person, that will remain humankinds’ advantage for some time.
2. Be ahead of the Game on exploring and using A.I. versus your competition
a. The ostrich in the sand approach will not work here. (Some) humans are going to become ludicrously more effective with these A.I. tools like large language models. You need to be in the top few of your peers for exploring and putting these technologies to work in your professional capacity.
Exciting and scary times lie ahead, but one thing I know – the late-night beers at Nuremberg, the intuition to know what your customer wants and how to best manage them, these are things we need to continue to embrace as humanity’s advantage…
…and on the topic of building my own human connections, see you in the bar at the upcoming shows!
N.B. This article was written entirely by a maladjusted human with all the shortcomings that entails, although both CHAT GPT & Copilot were asked to give ideas towards the article, they were unusually not that useful on this occasion! All of the images accompanying this article WERE generated by A.I. tools.
FACTORIES WE REPRESENT
We represent the following factories both in and outside of China. All of these factories have the necessary certifications, have capacity, have a history of successfully supplying other Toy & Game companies and who are very much open for business:
Plastic Toy Factory in China (managed from Hong Kong) – strong track record of decades of supplying Toy companies around the world.
Board Games supplier in China – I have worked with this vendor for 20 years, they have supplied dozens of major & minor customers of mine.
Games factory in Vietnam – supplying cardboard, wood & plastic Games.
Games factory in India – supplying major Toy & Game companies with cardboard & plastic games.
Plastic & Electronic Toy Factory in India – major supplier, having supplied 4 out of 5 of the world’s biggest Toy Cos.
Plush factory in India -leading Plush factory with strong R&D skills.
If you would like more information on any of these factories or if you need help with a strategic approach to Sourcing or want to find specific factory types, please feel free to drop me a message.
The BOARD GAME BIZ Podcast
Exciting news for the Games business, our all-new BOARD GAME BIZ podcast has now gone live, with 7 Episodes available covering a wide range of commercial topics relating to the business of Board aka Tabletop Games.
If you want to check out this new podcast series, just click here to listen!
EPISODE 1 - OVERVIEW OF THE BOARD GAME BUSINESS
In Episode 1, we start with a comprehensive overview of the Board Games business. We explore the key components that drive the board game market. Whether you're an aspiring game creator, a Game entrepreneur, a seasoned professional, or simply a Board Game enthusiast, this episode will provide valuable insights into the commercial intricacies of the industry.
Click here to listen to this episode: https://sites.libsyn.com/556277/an-overview-of-the-board-games-business
EPISODE 2 - UNDERSTANDING HOW BOARD GAMES RETAIL WORKS
Navigating the retail landscape can be complex, but it's essential for the success of any board game. From selecting the right distribution channels to understanding retail pricing strategies, we'll cover it all. We'll also discuss how to establish and maintain relationships with retailers, the importance of packaging and shelf appeal, and how to leverage retail data to boost your game’s performance.
Whether you're a game developer looking to get your product on store shelves or a retailer wanting to enhance your board game offerings, this episode is packed with valuable insights to help you succeed. Let’s dive into the world of board games retail and uncover the strategies that can make your game a hit!
EPISODE 3 - THE MANY BENEFITS OF PLAYING BOARD GAMES
Board games are not just about fun and entertainment—they offer a multitude of benefits that can enrich people's lives in various ways. From fostering social connections and improving cognitive skills to reducing stress and enhancing creativity, the impact of board games goes far beyond the gaming table. We'll uncover how playing board games can strengthen family bonds, develop strategic thinking, and even boost mental health.
Whether you're a casual player, a dedicated gamer, or someone interested in the positive effects of board games, this episode is packed with insights that will make you appreciate the true value of this timeless hobby. We feel it's important to run through these very many benefits of Games so that you feel real motivation to sell more Games, the more Games you sell, and the more Games people play, the more good we do for humanity!
EPISODE 4 - 5 COMMON REASONS WHY PEOPLE FAIL TO GET THEIR GAME TO MARKET
Bringing a board game to market can be an exciting yet challenging journey. Many aspiring game designers face obstacles that prevent their game from reaching store shelves. Today, we'll explore the top five reasons why these efforts often fall short. From common pitfalls in game design and production issues to marketing mistakes and distribution challenges, we'll provide valuable insights to help you avoid these traps and successfully launch your game.
EPISODE 5 - HOW TO SELL BOARD GAMES
Today, we'll explore the essential steps to successfully market and sell your board game. From understanding your target audience and crafting compelling pitches to leveraging social media and maximizing retail opportunities, we'll cover all the bases. We'll also discuss common pitfalls and how to avoid them, ensuring that your game not only reaches the market but thrives.
Whether you're a newcomer eager to launch your first game or a seasoned pro looking to boost your sales, this episode is packed with valuable tips and tactics to help you succeed. Let's get started and unlock the secrets to selling board games!
EPISODE 6 - INTERNATIONAL DISTRIBUTION FOR BOARD GAMES, WHAT YOU NEED TO KNOW
Whether you're an indie game designer looking to take your first steps into the global market or a seasoned publisher aiming to expand your reach, navigating international distribution can be a complex and daunting task. In this episode, we'll uncover the essential aspects of getting your games from your headquarters to the hands of players across the world.
We'll explore critical components such as the importance of cultural sensitivity and localization to ensure your game resonates with diverse audiences.
EPISODE 7 - REALITY CHECK: CAN YOU EARN A LIVING FROM GAMES?
Making a living through board games or tabletop games might seem like a dream come true, but is it truly feasible? In this episode, we dive deep into the economics and realities of the board game industry. We'll explore what it takes to turn your passion into a full-time career, from designing and publishing your own games to working within the industry in various roles.
The episode is hosted by our very own Games business veteran Steve Reece, who has worked in the business of Board Games since the turn of the millennium, thus proving that any idiot can make a living in this realm if they are excessively lucky :)
Watch out for more insightful episodes coming soon. if you have particular topics you think we could record an episode on, please feel free to hit reply, and if we feel we can make an entire episode from your topic we will do our best!
GEOPOLITICAL RISKS FACING THE TOY & GAME BUSINESS
The Toy business does not live and work in a bubble. We are influenced and impacted by what is going on in the world around us. Which today means that those working in the Toy industry are faced with a more complicated macro environment, in which many international norms we had come to take for granted are being challenged and this is in turn increasing risks of disruption for our businesses. This article was recently published on The Spirit Of Play Blog, part of the official website of the Spielwarenmesse, the world’s biggest Toy trade show.
Sign up to our Free Toy Industry Journal e-newsletter for the latest articles, podcasts, trends and insights into what’s going on in the Global Toy & Games business, just click here to sign up: https://forms.aweber.com/form/54/1325077854.htm
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