Toymorrow

Learning from Lego

toymorrow — Mon, 17 Aug 2009 14:58:04 +0000

Lego announced amazing financial results today, almost doubling net profits. How is Lego doing so well in the worst economy since WWII when the rest of the toy industry is down? What are they doing right that others are not doing?

There are a lot of things but there are three I want to highlight:

1) The price/value of open play – They have eschewed lights/sounds and other gimmicks for the most part and put more toy in the box than a lot of their toy competitors. Parents see Lego as multiple activities in one. Its a construction activity which they see as having educational value. Once built, its a toy that you can play with in a lot of different ways. And then it can be rebuilt into whatever the child imagines. The play pattern is wide open. The toy doesn’t tell you how to play with it or limit itself. In a time like this, people want as much value for their $$ as they can get and the open ended play of Lego achieves that. For a toy tech blog, I think this is an interesting lesson. Technology as a gimmick is an expensive indulgence in an industry with a 4-5x multiplier from BOM to shelf. Where technology is used, it needs to open up the play experience not close it off.

2) Dads welcome – The toy industry is obsessed with mom but pays little attention to dad. But dad is looking for ways to connect with his kids and contrary to popular belief, he buys toys. Lego knows this and has actively courted dads who love to build with their kids. The Star Wars license is brilliant for fostering this intergenerational bond. A friend of mine recently got his friends to chip in to buy his son the Lego Death Star. Now who do you think that toy is really for? I think a key lesson here is that toymakers should look for ways to include the rest of the family as much as possible, not create solitary play experiences. Parents are weary of kids playing all alone. Toys need to be a way of bringing people together. This is how the Wii with inferior graphics bested the other 3G consoles. It engineered a social experience for the whole family. Mom and Dad want to have fun too. Toy makers have forgotten this in the rush to gender specific, tightly age segmented toys that sell well in kid directed TV ad spots. But as the rules of marketing change and reputation becomes more important than impressions, toys that bring the family together will become more and more critical. And this brings me to my last point…

3) They get the web – Lego is one of the most progressive toy companies out there in terms of its use of the web and social media. They actively encourage fan created Lego stop motion videos on YouTube and they cultivate a passionate Lego collector base online. And they work the blogs like crazy. Lego knows how to stoke the flames of their passionate base to get people talking and as the rules of marketing are changed by Twitter and the like, they have been the early beneficiaries.

Bump

toymorrow — Sun, 16 Aug 2009 19:33:27 +0000

If you have been watching the latest iPhone ads, they are featuring an app called Bump by Bump Technologies. I like the app but I love the tech because it makes it easy to connect two iPhones in a peer-to-peer connection, something that previously involved a lot more work. Getting iPhones to connect is key to making iPhone enabled play experiences work. Bump tech could be a huge step in the right direction.

Playing with the iPhone

toymorrow — Fri, 03 Jul 2009 15:18:51 +0000

Smartphones and especially the iPhone will be important platforms for toy makers in the coming years. Last Christmas, we saw lots of kids starting to get the iPod Touch. And now at $99, the iPhone is poised for massive adoption with older kids. There is so much technology in the iPhone for toy makers to take advantage of – a beautiful touchscreen, a camera, now video, a fast CPU with graphics capability, an accelerometer – but now it looks like the iPhone may get one important new addition – an RFID reader. RFID has been making its way into toys for a few years and it provides a great easy-to-use, low-cost way to uniquely ID toys. When you combine all the other capabilities of the iPhone – capabilities no toy has ever had – with the ability to uniquely ID toys, you get a very powerful combo indeed.

The future of role play

toymorrow — Fri, 03 Jul 2009 13:57:01 +0000

Role play is one of the most important categories in Toys. Whether it is dress-up that let’s girls pretend to be a Princess, or Fairy wings that let a girl pretend to fly, or the unforgettable (and often imitated) Darth Vader helmet, or even the Hulk hands, role play toys allows kids to pretend and use their imaginations. What would be even better than the role play toys themselves is if kids had an imaginary environment in which to play with them. Red Octane, unknowingly, reinvented role play a few years back with Guitar Hero and gave us a glimpse of where role play can go. All of sudden, you had all sorts of people – kids to adults – rocking out with a plastic guitar and pretending to be a rock star because of the integration of a toy – let’s call the Guitar Hero controller what it is – with a video game. Motion control popularized by the Wii offers a lot of promise for this new generation of role play toys, and there have been a few since Guitar Hero – the Wii sports pack, lightsabers attachments, the Mario Kart steering wheel, the Nerf N-Strike, and now Tony Hawk Ride – but there is one problem. Nintendo has such incredibly restrictive rules for peripherals that it is really hard to make a peripheral that works as a good role play toy and also complies with Nintendo’s rules. In fact, some of the example I mentioned above are unlicensed peripherals for this reason.

When I saw Sony’s demo of their new motion control system at E3, I started to get very excited. Sony’s approach is based on the EyeToy system of several years ago, but is much evolved. The EyeToy camera (likely much higher res than the one consumers have at home) identifies and tracks physical objects with embedded LEDs of different colors with incredible accuracy. Now we get to see the patent behind this new system and it looks like EyeToy can track regular objects as well. That opens itself up to all sorts of possibilities. When you combine physical role play toys with the augmented reality 3D overlays that were also shown in the demo, the possibilities for imaginative play are endless. Hulk smash!

Mochi micropayments

toymorrow — Sat, 27 Jun 2009 14:38:40 +0000

TechCrunch reports on Mochi Media’s new micropayment platform for Flash games. Having struggled to make money with ad supported Flash games, they have turned their attention to a model for micropayments. You can play the games for free, but if you want better weapons, new levels, etc, you make a micropayment. And these games can be embedded in anyone’s site, anywhere on the web. The results so far are very promising – revenue has increase 1300% over ad supported games.

Toy makers should be paying attention to the Mochi model. Virtual unlocks are already becoming a popular way to drive toy collection and engagement with toy brands. But unlike the cost-intensive MMOs of the last few years, these are simpler games with lower upfront costs and the unlocks are more parsimonious – you get a single virtual item or upgrade, not a 12-month subscription like Webkinz. This model is inherently better for driving collection and better as a business. And it is also more social and distributed which is where the web is right now.

What iPhone OS 3.0 means for toys

toymorrow — Sun, 21 Jun 2009 14:06:26 +0000

Apple posted its latest version of the iPhone OS on Friday with many needed and useful features. But for toy makers, there are a few that are truly breakthrough and offer great possibility -

iPhone apps can now control peripherals via 30-pin connector – This is really the pre-requisite to making any toy more sophisticated than iDog for the iPhone. Now iPhone apps can control and receive data from toys…but at a price. The iPhone connector pricey from a toy POV.

Peer-to-peer Bluetooth – Now iPhones can talk to one another directly without having to go through the network. Useful for “gathering” a group together for game play.

In-app microcommerce – Now users can buy within an app without having to go to the App Store opening the possibility to sell new levels, virtual items, or toy upgrades without interrupting the user experience.

The iPhone opens a lot of new possibilities for toy makers but also requires big mind shift. But with iPod Touch as one of the hottest Christmas items of 2008 and likely 2009 and with $99 iPhones now, expect more and more kids to be carrying these handheld computers in their pockets. If toy makers can figure out how to harness their power – technology they could never afford to put in a toy – they can make some pretty spectacular products.

Toymorrow Open

toymorrow — Sun, 21 Jun 2009 13:49:44 +0000

Hi there. I’ve created this blog as a place to talk about the future of toys and how technology is playing a role. Hope you’ll join the conversation.