1985 As long as you could produce toys, you would reap great profit;

1990 As long as you could produce creative toys, you would reap great profit;

1995 If your creative toys have good quality, you would get some profit;

2000 If your toys have no unique trait, you would lose money;

2005- If you fail to put your toys into specific market segment, maybe you are starting an ignorant ceremony of suicide.

In fact, however, many Chinese toy makers and traders are chronically making similar suicide investment:

--With no market research, investment is relied on perception or even preference of the owner.

--With no right market position before product development, the investor has no idea about what kind of region, social class and consumers group should his product aimed at.

--Wrongly bringing product ahead of market, the investor does not consider at all what kind of precuts his company and dealers cab sell. Instead, he prefers to require his team to sell what he produces;

--Not knowing to exploit his favorable points and avoid unfavorable ones, he would simply follow the mass when making new investment.

Deplorably, toy industry continues to see such a situation in an endless way.

I have once talked with some owners of toy makers on the significance of market research, but most frequently, I hear them say “only big one does market research, but we are small business. Even if we want, we can not afford it. So, we have to follow big makers and just consider the thing under my nose.”

It totally makes me down: When you have not idea about what others want, how can you find way to get money out of their pocket?

To make leap and bounce development, one must shift its outdated management notion at the very beginning. With no clear management thought, a company must go at sea for its position, let alone long term development. China has entering an era of market economy, forcing companies to produce commodities that meet market demand. The days of planned economy has gone, when wrongly make market to follow up production.

Then how to change the situation? I try to figure it out in some ways.

Collect information before adjusting direction according to market demand

Perceive the market. For instance, this year is a “year of pig” in Chinese lunar calendar and lots of newly-married couples plan to have babies (related statistics show that, the period of baby boom during the lately 2 decades would come this year). It can be found that, in the coming three years, products related to mummy and baby would surly run well. It is necessary for us to find firm proof after having this bold prediction, seeking answer by means of research. When we get exact data by quantitative and qualitative analysis, questions like “whether to invest” or “how to invest” can not be clearer. Who is most close to market, who will see wider room for surviving—it is the trait of market economy.

Focus on sales resource when developing product

Suppose Company A is dealing with a major business of R/C products, then its dealers are basically seller for the categories. So thus lower-stream clWhen A want to develop a series of doll, correct client resource is not enough no doubt. Therefore, it would be a great investment for A to start the doll line, causing a delay for launching time and a waste for original sales channel. Such a story happens frequently in toy industry, but lots of companies fail to know its seriousness.

Make full use of own advantage for new items

Similarly, if A continue its R/C products, it would be easier. Workers’ proficiency, current plastic mode and part of products are all advantages. Besides, other supporting products such as IC allow no ignorance. Suppose Company B want to invest to R/C products, who is a doll producer previously. It would be a huge investment for B, since everything starts at the very begging. A same new R/C car line that cost A 500,000 yuan may possibly cost B over 1 million. Lots of people may understand the theory inside.

Toy industry can share successful experience of household appliance industry. Firstly, consumers would be affected by a brand concept. When you say “TCL”, consumers would come to TV set at once. When you talk about “Gree”, air conditioner comes to consumers’ mind. And how about “Tonze”, listener would associate the name with electrothermal appliance. In fact, these brand names have taken root in consumers’ mind, which are not easily to be swayed.

Take Tonze for example. With sharp characteristics, the household appliance maker clearly sees others’ adverse effect caused by over-expanded business scope. Therefore, the company sticks to its own edge, exerting all its core products thoroughly. That’s the old saying of “technique differs in specialty”

The above theory is purely my own idea. I hope it would benefit toy makers when making investment decision.

Writer’s Bio:

Wang Renbing, Domestic Marketing Manager of Song Yang Toys.