“If you don't have a strategy, you're part of someone else's strategy. ” - Alvin Toffler
I ended my last posting with the words: “Don’t worry; there will always be a toy industry but…"
I wrote wrote those words as a palliative to those who had just attended PlayCon 2014 and heard a fairly steady message of constant, frequent and disruptive change that was and will affect their businesses. I was reminded of Alvin Toffler’s astoundingly prophetic book, written in 1970, on the impact that ever more rapid change was going to have on all our psyches.
So, before I get into the “but” of it let me state clearly that nothing is going to replace the look on a parent and toddlers face when that first soap bubble is blown, glows with rainbow hues, floats, and pops and magically, in the blink of an eye, ceases to exist. That is the shared magic that a simple toy can provide.
So, there will always be a toy industry but how much revenue will it produce? How many companies can it support? How many toy retailers can continue to exist?
So, what should the toy industry be concerned with and what challenges are preventable or can be ameliorated?
Yes, 3D printers are going to allow families to have little factories right there in their bed and family rooms. It is going to begin as a craft activity and evolve into a practical way of making essentials. Forward thinking toy companies are going to want to begin considering what add-ons that form of play will require in terms of paints, accessories, play environments, branding, licenses and more.
The Price Value Relationship
One of the messages I noted during PlayCon was the rise in peak performing price points to the $50 range. More interesting to me was the decline in the low price points like $2.99. It should come as no surprise that free apps were going to replace disposable toys. This is not good news for low cost toy providers and they will need to rethink their business models. But it is good news for those who work in higher price points. The answer, at least to me, is to concentrate on the perceived value of toys and focus on what toys do best, provide a tactile experience that feels a whole lot better and lasts a whole lot longer when the materials communicate quality, durability and scalability. Think legacy instead of landfill.
The best way to avoid obsolescence is not necessarily to suddenly change, although in some cases that may be called for, but to expand the notion how end users can play with your products. Get to know your cousins in the digital, video game, children’s media and other industries. Learn their languages, enter their business cultures and communicate. By doing so you can find allies who may give you a vision and maybe a partner in expanding your brand and its value into places you never thought about.
Today’s children have less time to play and more to play with than any of us did as children. Natural selection is going to weed out those traditional toy, digital, video game and other products that don’t break through. What you can do is make sure that your toys provide a substantial play experience and that merit a slice of ever more valuable time. Also, broaden your visibility by providing access to your brand via other platforms. Like I like to say, I should be able to call Colonel Mustard from my cell phone when I am not at the Clue board and ask him for the skinny on Mrs. White. By allowing me to do that, Hasbro expands my game experience while expanding its bandwidth in my brain.
What business are you in?
The individual Toy, Video Game and App industries are struggling mightily but their aggregate, the “Play Industry” is doing just fine. Step back and ask yourself this question: “If I am in the play industry rather than the toy industry, who are my actual and potential competitors, retail customers, allies and consumers? What opportunities and threats do I see?
Yes, all of those who engage in the business of play are being challenged by a changing business landscape, technology and culture. So, most importantly, if you want to stay competitive, remember the magic on a child and parent’s face while blowing bubbles. That’s magic and if you continue to provide that magic, children and their parents will demand your toy.