THE REAL TOY STORY
Inside the Ruthless Battle for
America's Youngest ConsumersBy Eric Clark
Free Press; 259 pp; $26
The Good A colorful look at how giant toy corporations duke it out.
The Bad Billed as a startling expose, it won't surprise many adults.
The Bottom Line A worthwhile overview of the $22 billion toy business and the challenges it faces.
Each February, thousands of toy manufacturers, retailers, promoters, and dreamers descend on New York for the industry's mammoth Toy Fair. Many come lugging new toy samples—some no more than models in Styrofoam and glue—that they hope will make it to retailers' shelves and little kids' hands by Christmas. It's an inspiring and amusing phenomenon: There's something incredibly cute about grown-ups trying to pitch the next Cabbage Patch Kids or Easy-Bake Oven. But, alas, in Toyland, as in almost every industry, dark forces are at work.
Those dark forces are what British investigative reporter Eric Clark seeks to expose in The Real Toy Story: Inside the Ruthless Battle for America's Youngest Consumers, billed by his publisher as a Fast Food Nation for the Beanie Baby biz. Clark describes a world in which giant corporations, struggling to cope with retail consolidation and children's waning interest in traditional toys, slug it out in a global version of Rock'em Sock'em Robots. Foremost among the toymakers' heinous deeds is the exploitation of low-cost workers in China. On top of that, they employ TV, the Internet, and even slumber parties seeded with products to turn children into toy-hungry tyrants, destined to nag their parents into purchasing the latest It'll Keep Them Busy for 20 More Minutes Elmo.
My problem is this: Does anyone not know these things? Isn't all this a bit like telling parents there is no Santa Claus?
Still, Clark's volume provides a colorful overview of the $22 billion toy business and the challenges it faces. For one thing, kids are getting older faster, as the industry expression goes. They very quickly jump from dolls and toy trucks to computers, iPods, and video games. That's why toy sales have been lagging for the past few years. To make matters worse, discounters Wal-Mart, (WMT) Target (TGT), and Kmart (SHLD) have come to control the lion's share of the business, while retailers such as Toys R' Us and FAO Schwarz are struggling. Pricing pressure brought by these big merchants forces large toymakers to seek out lower-cost labor overseas. Meanwhile, small producers find it ever tougher to get distribution.
Clark offers a whirlwind history of toy advertising on TV. That begins with two critical events from 1955: the first televised toy commercial, for Hasbro's (HAS) Mr. Potato Head, and the decision by Mattel's Elliot and Ruth Handler to pony up their company's entire $500,000 net worth to purchase a year of advertising on a new ABC show called The Mickey Mouse Club. The emphasis on TV advertising turned out to be only the first step in toymakers' evolution into entertainment companies. In 1984, Hasbro transformed the industry with Transformers—a line of shape-changing robots that simultaneously appeared in the U.S. as toys, comic books, and an animated TV program. Today, royalties from toy sales provide critical funding for even public TV shows such as Sesame Street. Mattel, (MAT) meanwhile, releases feature-length DVDs starring Barbie.
In his final chapter, Clark visits China, or as he calls it, Santa's Sweatshop. Rather than cite the experiences of real employees, Clark only produces a composite, whom he calls Li Mei. The 18-year-old factory worker in China's Guangdong province suffers from a range of workplace disorders, including open cuts on her hands and rashes from the toxic chemicals she is exposed to at the plant. Just to obtain her job, which pays about $1 a day, she had to bribe a supervisor. Workers like Li Mei sleep, sometimes two to a bed, in company-owned dormitories. They get charged extra for meals, physicals, employee ID cards, and even toilet paper. To meet quotas as high as 4,000 dolls a day, Li Mei must work night shifts, where she gets fined if she dozes off.
Working conditions in China can be reprehensible, and Clark is to be applauded for reminding the world of that fact. But what's likely to stay with readers are Clark's anecdotes about how many well-known toys and games got their start. Did you know that Lincoln Logs were created by architect Frank Lloyd Wright's son, who was inspired by his father's design for Tokyo's Imperial Hotel? Or that Play-Doh was developed first as a cleaning compound for wallpaper? Slinky, it turns out, was the brainchild of a naval engineer, who was inspired by a large torsion spring that he saw on a ship.
The present-day counterparts of such inventors represent the strong suit that the toy business will rely on to survive the powerful waves of consolidation, globalization, and competition from consumer electronics. And they'll all be out at Toy Fair in February—glue guns in hand.
By Christopher Palmeri
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By Christopher Palmeri