INSIDE TRADER: Reducing risk of toy launch failure

ToyNews' Inside Trader Steve Reece explains what companies can do to ensure their next fresh toy is a hit under the tree...
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One of the very notable features of the toy industry is the high number of new products entering the market every year.

In fact, on average, somewhere between two-thirds to three-quarters of all SKUs in the market each year are new. Because of this, a bad 12-month period doesn’t need to stand in the way of a good 12 months next year. Nevertheless, it’s important to acknowledge the risks with new product launches.

With a new hero range launch costing hundreds of thousands of pounds (or more for global launches), it seems imprudent to just accept that some products will work and others won’t.

Toy companies which experience lasting success tend to be experts at reducing the risk of product launch failure. There are several elements to this, including taking on board retail feedback, monitoring competitors, tracking what has sold most and why it has sold so much.

However, there is one massively under-utilised tool, which is very powerful if deployed effectively: consumer research. The reason for its underuse is there are so many parts of the development and launch process we have to manage, and can’t escape, which makes consumer testing seem optional, or avoidable. 

However, not to validate your concepts with consumers is to fail to manage the risk of launch failure, because ultimately, it’s the end consumer who has to buy the product.

There are two primary challenges in selling high volumes of products: getting enough of the right product on the right shelves and e-commerce sites; and getting enough users to buy.

So to launch based on gut instinct, and inward looking product selection debate only, is to miss the chance to address half the risk of failure.

This is not a theoretical viewpoint either – a classic example would be the research project I conducted on a new toy some years back. The concept seemed clever to a room full of adults in a toy company, but the main feature was based on a flawed concept, which depended on false presumptions about how kids play. 

I advised the company not to launch the toy, but they felt they were too far down the path, and launched it anyway. They created a strong advertising campaign and sold it in well, but it bombed, leaving them with a major hangover in terms of obsolete stock, both in retail and in their warehouse. This just goes to show that you can lead a horse to water…

One reason firms give for not conducting more consumer research is that findings and direction can be fluffy, unreliable or impractical, or that research costs too much.

Some research agencies focus on their expertise, such as research methodology, and nowhere near enough on providing a commercially relevant interpretation of the findings. However, I’d argue the onus on this should be with the team developing the product, because consumer research can be imperfect, but imperfect isn’t the same as useless.

Having conducted research with thousands of kids, I have never seen research which hasn’t at least made toy product teams question their presumptions based on how kids interact with their concepts.

And that can only increase the chances of launch success.

Steve Reece is a leading brand marketing consultant in the toy and games industry. 

Contact him via, or see his blog at



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