Warm, Fuzzy & a Heart of Silicon: Toy Biz Abuzz with 'Interactive'

Brandweek, Feb 15, 1999 by Becky Ebenkamp, T.L. Stanley

It's sort of the crying and wetting doll meets Small Soldiers. Whether it be to entertain or to educate, the mandate for toys this year seems to be, "Don't just stand there--do something." And they are doing more than ever, ranging from dolls that tell stories about what they did yesterday and action figures that recognize each other from across the room to plush toys that turn their heads to speak directly to their humans.

Intel Play's multi-tasking microscope attached to a PC lets kids make movies and print out stickers of their much-magnified images, and LCD readouts on Tiger's yo-yos rate the players' skill. Hasbro is embedding computer chips for speech and sound effects into its Star Wars, The Phantom Menace action figures, just some of the thousands of Lucas-film-licensed SKUs that the No. 2 toy player projects will account for $1 billion in worldwide sales in '99 (other sources have the conservative estimate at $960 million).

The preschool market, the only remaining captive audience, has heated to scalding, and time-deprived, information-hungry baby boomers are fueling an explosion in the educational toy category. Anyone who didn't have a toe in those areas previously has jumped in now, making a strong brand identity a key advantage for marketers who find themselves shoulder-to-shoulder with a new cadre of competitors.

"The challenge is and always has been to do something commercially viable, from an affordability standpoint, and do things that don't cross the line into crass," said Leslye Schaefer, svp-marketing and consumer products at Scholastic Entertainment, home to Animorphs, The Magic School Bus, Clifford and Goosebumps. "If you say it's educational, you have to live up to it."

As for "interactive," Fisher-Price evp-sales/marketing Jerry Perez acknowledged that it is simply a new buzzword for an old toy biz concept And yet, thanks to the success of Tickie Me Elmo, Furby and that strange phenomenon known as the Talking Teletubby, the word "interactive" was nigh omnipresent at last week's Toy Fair. Nearly every manufacturer was showing off the next generation of the interactive toy, from the Gizmo-branded Furby (from the Amblin flick Gremlins, soon to be re-released) with a "deep-sleep" feature to low-priced digital cameras that need no computer link. Godzilla-licensed merch notwithstanding, there was nary a character represented without a fluffy yet interactive SKU version that wrapped cold technology in a warm and fuzzy coat.

"A high level of interactivity with the child is key to success," said Perez. "If it's just a 'watch me' toy, it will die everytime."

Playmates, which had a breakthrough No. I selling large doll last year in Amazing Amy, returns with Amazing Ally, a computer chip, animatronic "best friend" doll that can order a pizza on her cell phone, knows when her hair is being brushed and what kind of outfit she's wearing, and can remember details about her Owner. Ally, who sings songs and tells jokes, and carries a $60 suggested retail price, has been dubbed a "doll system," containing expandable technology.

"The reality is, 3-year-olds are able to work on computers, so why shouldn't their toys be as advanced as they are?" said Gina Beebe, Playmates' vp-girls marketing. "Some kids are just as happy with a basic teddy bear, but others need more. There will always be a need for both."

Because technology is advancing quickly and computer chip prices are dropping, toymakers can incorporate more for less, allowing them to keep their prices competitive.

Scholastic's Schaefer avers that many high-tech gizmos don't stimulate kids' imaginations as well as toys of the past. Still, she doesn't dismiss their place in the market. "Because kids are so smart at an early age, manufacturers have to do this to keep them challenged," Schaefer said. "And there's no question that the toy companies have to do this stuff--if one guy doesn't do it, the next one will."

Against a backdrop of a faster, more competitive world and eroding confidence in schools, parents want to feel good about their toy purchases. Elizabeth Gross, vp-marketing at Hasbro, attributes the edu-trend in part to harried parents wanting to make up for less time spent with their children; toys that double as learning tools ease consciences. And socially, there's less of a geek stigma these days: cyber-entrepreneurs enjoy the status of rock stars in some circles. "Kids are saying it's cool to be smart," Schaefer said.

Because of this edu-chic, many toy marketers seem intent on slapping an educational label on just about every product they sell, especially those with an interactive component. To wit, the dubious Sesame Street-based Cookie Crunch, where kids toss treats into the mouth of the Cookie Monster. Promoted as a counting tool, kids only learn Nos. I and 2.

At least the plethora of wrestling-related items didn't throw any educational claims into the ring; just fun, fantasy and a heapin' helping of testosterone. Key in wrestling licenses' value to toymakers is in providing one of the only boy-skewing alternatives to Star Wars, say marketers at the dozens of companies on board with the World Wrestling Federation and World Championship Wrestling. Toy Biz, which last year sold 1.1 million of its only WCW product, Bashin' Brawlers, will launch Tuff Talkin' Wrestlers with sound chips and infrared sensors, along with other action figures that respond with "oofs" and "ows" when they're punched and pummeled. An electronic wrestling ring includes crowd noises and Michael Buffer's signature "Let's get ready to rumble!" call to action.