David Fitzgibbons is an executive recruiter for the toy industry. His work at Exectutive Search Group mostly involves matching companies with upper-management talent. However, one of the company’s sites, the aptly named thegreattoysearch.com, invites inventors to submit their toy and game ideas. Another site, the likewise aptly named toyindustryjobs.com, also features a “Cute or Cool” page for toy designers, illustrators, product developers, sculptors and packaging people. You can upload your portfolio images, which toy companies screen for possible consideration. The process is free. Who knows, maybe your work will grace the next hot-selling toy. We asked David to share some of his toy-industry insights.
ID: What makes for a great leader in a toy company? What sort of leadership qualities do toy companies typically look for in their c-level folks?
DF: A great toy company leader is a marketer first, a salesman second and an accountant third. It is true a toy company president must have fiscal acumen to manage his company. But the industry rewards innovation in the aisles. Innovation comes from the right side of the brain not the left/accounting side. The toy industry is a fashion business and the fashion industry is fickle. Add children into the equation and you have a fast-moving, fashion-forward fickle customer. It isn’t easy to satisfy that customer and I have yet to meet an accountant-type who could.
The toy industry is rapidly changing. Retailers are risk adverse and they want brands not items. Retailers want manufacturers to secure licenses, which mitigates the risk for the retailer but increases risk for the manufacturer. Today’s leaders must have a strong financial background, the ability to keep their products safe and recall-free and who additionally have the ability to avoid innovation and change. Today’s leaders need the ability to avoid innovation and change because big-box retailers want the “same old stuff.”
ID: That’s sort of depressing to hear. Moving on, what are some of the biggest mistakes inventors make when approaching toy companies?
DF: The three cardinal sins of inventors are Myopia, Greed and Costus Interuptus. The myopic inventor can’t see past his creation. S/he is in love with their creation and doesn’t see its weak points and/or won’t correct them. The inventor needs to see the big picture – the current economic climate, what is the taste of the child today, is the toy fashionable but most important, how does this toy help the manufacturer (not the inventor) and can it become a brand of its own. Toy companies do not want to acquire one-off items. They want lines/brands.
Gordon Gekko said “Greed is good.” But that’s true only to a point. Myopic inventors see millions of dollars of product being sold and they understandably want to get paid. Unfortunately, it doesn’t work like that anymore. New product acquisitions are risky and costly. Companies don’t want to risk large sums of money upfront or on the back-end (royalties) as they need to protect their margins.
Costus Interuptus. Simply put, inventors don’t realize how to cost their concepts. One of our Web sites, www.TheGreatToySearch.com, too often receives items heavy in plastic with complicated mechanisms and sophisticated electronics. Inventors need to realize that the item has to meet a certain retail price point and the manufacturer has to pay your royalty and maintain its profit margin in the process. The manufacturer can’t achieve those goals if the item is too costly to manufacture.
ID: How has the toy industry changed over the last few years when it comes to accepting new products from outside their own walls?
DF: The current economic climate which includes reduced consumer spending on toys, higher manufacturing costs and less access to cash (lines of credit, etc) have all put downward pressure on the need and desire for the acquisition of outside concepts.
ID: Again, that’s depressing to hear. That said, where do you see some of the more promising areas for toy innovation?
DF: Electronics, electronics, electronics. Fresh new technology or the introduction of new technology in an old item – that’s the fertile ground. Bring me a remote-control helicopter that can fly without limit and the world is yours. But think outside the box – forget about batteries. Power the item with air, water or solar technology, or a new technology in your unrelated field that the toy industry hasn’t yet experienced. Remember, real innovation will always find a home.
ID: Ah, that’s more like it. Tell us, what’s your favorite toy of all time?
DF: The 1964-era 12” G I Joe. Joe’s detailed line of accessories, realistic uniforms and extensive play pattern won me over at a young age. It also taught me a valuable lesson as the inventor of GI Joe took a lump-sum payout of $100,000 for his concept rather than a royalty. That decision cost him nearly $20 million in royalties. For what it’s worth, I too would have taken the $100,000 in 1963.