There is genuine fear among toy manufacturers that they might develop a hugely successful toy only to be challenged legally and accused of stealing the idea from an inventor who showed them a not dissimilar idea a few years ago, sketched on the back of a fag packet.
I remember being told exactly that many years ago by Lego in Denmark, which is quite ironic, really, when there have always been questions about the origin of its original building block.
The outcome of MGA’s bust up with Mattel may induce a bout of extreme inventor paranoia but, while no fag packets were involved, it has sharply focused attention on the crucial role that the origin of intellectual property rights has played in this business.
The potential of a claim by an inventor that he had first created a product that someone else had brought to market has always scared manufacturers. It has made them wary of entertaining external ideas from people who they do not have a relationship with. They tend to rely on a trusted band of inventors to whom they have often turned. For new people, getting to see the product development team can be a bit like pulling teeth – but all that would appear to be changing as the current economic climate sees in-house teams being trimmed, with toy companies starting to encourage external concepts as a result.
Does that mean the dawn of a golden era for inventors?
Don Rosenwinkel, of Chicago-based design firm Blue Monster Toys, would like to say that it is going to be a golden era for inventors, but he actually thinks that it is going to get much tougher. “Ideas will only be as good as your ability to execute them. This will require development and development is expensive. The days of selling an idea from a napkin sketch are long gone, as the burden of the development is moving from the manufacturer to the inventor. This will increase the inventor’s costs of operation along with their risk.”
That is fine if you are already set up as an invention house with a reputation to draw on. Bruce Lund of Lund and Company Invention in the US thinks it is too early to say if it is boom time for inventors.
“Manufacturers are streamlining costs out of products and royalties is one more cost that can be squeezed,” he observes. “Not sure I see a golden era on the horizon, but I love the thought of it. Fingers crossed. The world changes, it’s full of surprises, and not all are bad.”
Howard Fleischer of RoyaltyPros Licensing in New York says yes – with a condition. “The reason I say a qualified yes is because the manufacturers have raised the bar over the recent years on the level of development that they expect the inventor to do in order to get traction with them and, ultimately, a good deal.
“There seems to be a concerted effort from the toy industry as a whole to woo the top professional toy designers to their favour. I have noticed an increasing competition amongst the major toy companies to get the inventing community to bring their best inventions and insights to their respective development camps first. By nurturing this community – which in relative terms is initially much cheaper than an inside development department – just one successful relationship can pay high dividends for all involved well into the future.”
Toy companies usually demand exclusive licences from external inventors and they also prefer products that can be extended into complete lines. It sounds like the onus to present product concepts of a higher quality is falling squarely on the shoulders of the design and invention community. Fleischer thinks manufacturers look to the savvy developer to present concepts that are well thought out, almost completely engineered with respect to function and manufacturability at a low cost. He also sees them asking for tie-ins to entertainment/brand licences that the toy company owns the marketing rights to, a tall order for those who wish to be considered within the manufacturers’ Toy Designer ‘A’ lists.
“All things being equal,” Fleischer continues, “a key component to the life blood of the toy industry is innovation and fun, and it is no secret that the freshest of ideas historically come from outside visionaries. So it is fair to say that given the quality of industry insiders who will be on the outside these coming years, things will definitely be looking up for the ones who can leverage their industry experience and contacts.”
Back in Europe, Lego says that the company has transformed its design function in recent years, streamlining it to improve innovation across the entire business. Traditionally, Lego rated the ability to model creatively with its system as the key criterion for its designers, but now professional designers are actively sought, placing renewed importance on enthusiasm for Lego itself.
Vivid Imaginations has an in-house R&D, engineering and packaging team that manages the product development process from concept innovation through to production. Marketing and licensing director Emma Sherski says Vivid enjoys working with its worldwide network of toy inventors and some of its most recent hits, like Doodle Doug and Daisy, along with Crayola innovations like Spinaroo, have come from talented industry inventors.
“We are constantly on the look out for new licences and in-house created brands to feed into our development team and this also allows us the opportunity to distribute these products through our international network of distributors.”
At Mattel, meanwhile, over 80 per cent of new product ideas are developed internally, but the firm is more receptive these days to key outside inventors.
Mattel retains a large internal staff of designers, model makers, sample makers and in-house inventors who cost far less than external designers’ royalties. And, trying to encourage fresh thinking internally, Mattel arranges for speakers to address its product developers to suggest new ways for design staff to brainstorm and generate new ideas.
Despite performing a lot of internal inventing, Mattel has no hesitation in paying royalties for great new products and key product development executives make regular trips around the country to review new ideas from the inventing community. It is estimated that Mattel meets with inventors and views 400-500 concepts on a typical ten-day trip.
Perhaps it depends on which side of the fence you sit but the designers and inventors seem to be saying that there is now even greater emphasis on them to deliver concepts as cheaply and as professionally as possible. So, while manufacturers are feeling the pinch, they seem to be leaning even more heavily on the suppliers of original concepts.