The ugly underbelly of the toy industry

Imitation is the sincerest form of flattery, right? When it comes to knocking off my award-winning Build & Imagine magnetic dollhouses, I’ll trade it for respect.

With a fa?ade that is all fun and games, the Toy Industry has a cut-throat underbelly leading to practices tinkering on the edge of ethical. It’s highly seasonal, hits-based, mature (a.k.a flattened growth curve), sensitive to the changing landscape of retail, and runs on slim margins. These are stress inducing ingredients that contribute to the feeling of a zero-sum game, where manufacturers often look to get ahead by stealing a piece of their competitor’s pie.

I’m the founder and CEO of a toy start-up called Build & Imagine. I was named the “Rising Star Toy Inventor of the Year” and in just two years on the market our magnetic dollhouses have won more than 30 awards and have hundreds of five stars reviews on Amazon. Kids love snapping together our illustrated magnetic panels to build a custom dollhouse that is different every time they play, and I love that by doing so, they are developing foundational STEM skills like spatial reasoning, problem solving, and design.

I’m awake in the middle of the night writing this post, because for the 3rd time since I launched Build & Imagine I got an email from a friend in the industry that said something along the lines of, “Have you seen this??! Thought you should know!!!” And then proceeded to show me photos of a new product at a tradeshow that looks a hell of a lot like my line.

Luckily, our Build & Imagine utility patent has prevented others from knocking off our proprietary magnetic panel design, leading these look a-likes to develop less satisfying building mechanics. Still, their “fast follower” business model hurts me, particularly as an independent entrepreneur. By taking my concept and offering alternatives with similar aesthetics it creates customer confusion, dilutes my brand, and siphons off much needed revenue to survive.

This is nothing new. Looking at my own work experience I’ve seen the recurring theme starting when I worked for LeapFrog in the pre-IPO days. At that time Leapfrog was on a rocket ship having essentially created the educational electronic toy category with hits like the “Leapad” and “Leapster”. The products I developed won five TOTY Toy of the Year awards, which is like the Oscar’s for toys. We poured a ton of time and money into R&D. I had one software title with a million-dollar budget that we developed for a year and a half. Of course, our hardware had a much longer lifecycle and bigger budget. Our dedication to great content and customer experience made it sting all the more when our chief rival seemed to introduce look-alike learning platforms just months following ours. Side by side, sitting on the shelf, the customer had a tough time knowing that we were the innovators with superior content. All they could tell was that the competitor’s offering was $10 cheaper. We felt like the unpaid R&D department for this Chinese manufacturer. Years later, our rival’s business model won out and Leapfrog alumni who still bleed green turned to a private facebook group for support, when the rival purchased the company we had helped to build.

Stevanne Auerbach, who is affectionately known as Dr. Toy, recognized this dilemma back in 2006 and worked to introduce a code of ethics for the Toy Association in an effort to curb plagiarism, copycats, patent infringement, trademark misuse and related issues. I’d like to see Toy Association uphold this code when it comes to their tradeshows, perhaps by deducting future booth assignment points from those in violation. In addition to industry policing, consumers and retailers can play a role by educating themselves about a product’s origin, supporting startups, and showing loyalty to concept originators.

In addition to me, the past four “Rising Star Toy Inventors of the Year” have been female entrepreneurs. Operating independently, we’re able to develop market insights and take risks to impact meaningful change, particularly in regards to the role toys play in reducing the gender innovation gap. Although I am extremely frustrated by knockoffs, I recognize Build & Imagine’s contribution in founding the constructible dollhouse category. I know that it’s getting girls building, and for that I am proud. Similarly, former “Rising Star” Debbie Sterling of GoldieBlox exposed the opportunity to develop STEM toys for girls. It’s no surprise that K’nex followed with the Mighty Maker line for girls and MGA entertainment introduced Project MC2, a TV series and toy line for girls revolving around the theme of STEM. Analogously, a few years after startup “IAmElemental” launched the first female action figures on Kickstarter, Mattel followed suit and took home the TOTY award for “Action Figure of the Year” for their new DC Super Hero Girls Action Figures.

Mompreneurs are a force to be reckoned with. We're delivering market insights and innovative products and services. And in many cases, we're steering the "Big Boys" in the right direction by shining a light on the market's readiness for change. Now, how do we reap more of the financial rewards for driving these market insights and innovation?

We’re growing the overall pie. I’d like to eat some too.

About Laurie Peterson

Laurie Peterson is the founder and CEO of Build & Imagine (www.buildandimagine.com), an award-wining toy company with a line of magnetic dollhouses that get girls building. Laurie founded Build & Imagine after noticing that the kind of play experiences she loved as a child (involving building, problem solving, and designing) were not well reflected in the “girls” section of most toy stores. In the two years since launch, Build & Imagine has won more than 30 awards including being nominated for “Construction Toy of the Year” at the TOTYs. Laurie was named the 2015 “Rising Star Toy Inventor of the Year” and has placed her dollhouses with top retailers including Amazon, QVC, Walmart.com, and specialty stores.

About Build & Imagine

Watch your child become a designer, builder, and storyteller right before your eyes. Build & Imagine’s colorful illustrated StoryWalls connect magnetically to build a world where dress-up characters work and play. Easily change things up and create a whole new adventure for endless imaginative play. It’s the fun of a dollhouse with the enrichment of a building set. Shop the Build & Imagine Collection on Amazon.