furby this baby!

[The Tin Man]

Marketing

Vendors of diamonds, stocks and Furbies have a lot in common.

Don't flood the market

By Benjamin Fulford

"I'M SORRY, SIR, it is not for sale," says the clerk at Manhattan's big
toy store, FAO Schwarz. "It's a display
model."

A kid wails, "Why can't I have it, Dad?" Suddenly all the kids want it.

Why are Furbies in such short supply? Because Hasbro, the manufacturer,
seems to have deliberately made them
scarce.

"They made about a million, which is not a lot. At my neighborhood store
they have built up a backlog of 500
orders in the past week or two," notes Margaret Whitfield, a toy analyst
for Tucker Anthony in New York.

If you want to sell, play hard to get. This law, in fact, may be
biologically determined. In one interesting
experiment, researchers reportedly trained female fish of a type that
ordinarily have male fish chasing after them
to turn the tables and chase the males. The behavior made the males
impotent. If the males didn't have to work for
it, they didn't want it.

Carefully orchestrated supply, in contrast, can make sellers rich. Look at
diamonds, skillfully manipulated for
decades by De Beers Consolidated Mines Ltd. and its fellow cartelists.
They could produce diamonds a lot faster
than they do, but that would drive the price down and make diamonds less
desirable.

On Wall Street such behavior is not unknown: Keep that initial IPO small
while hyping demand for it and you can
create insatiable demand for the next round of financing.

It's old hat in the toy business. Ty Inc. has made a mint off its Beanie
Babies by taking different models of these
stuffed animals off sale before demand is satisfied, giving rise to a
belief by who knows how many Americans
that the cheaply made imports have some kind of collector's value.

For Hasbro, with $3.5 billion in 1998 estimated sales, a million Furbies
retailing for $30 each add up to less than
1% of sales. Nonetheless, restricting supply is a good move because it
makes retailers happy with Hasbro. This
is one product for which they won't be stuck with unsold inventory.

"Oversupplying product is probably the greatest risk associated with fad
marketing," warns Karen Raugust in the
EPM Fad Study, an analysis of marketing fads published this year by EPM
Communications, Inc. of New York
City.

What to do if your kid wants a Furby? Persuade her that Tickle Me Elmo is
a better doll. It's certainly a better
buy. Two years ago this toy was so hard to find that people were paying
$500 for it on the black market. Now
you can get one for $20.

| back to top |

Read more: By Benjamin Fulford
Management, Strategies, Trends
Marketing
From December 28, 1998 Issue

This story, published in Forbes Magazine (www.forbes.com) on December 28,
1998.

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"Noel Noel Noel Noel. May all my enemies go to hell." - Hilaire Belloc

Robert Fernandez
rfer...@chuma.cas.usf.edu
http://chuma.cas.usf.edu/~rfernand
AIM: Gamaliel8

[Paul T. Jantzen]

The Tin Man wrote:
>
> Marketing
>
> Vendors of diamonds, stocks and Furbies have a lot in common.
>
> Don't flood the market

Thought some of you out there might enjoy this site.

<A HREF="http://www.phobe.com/furby/">Furby Autopsy</A>

[The Tin Man]

When a friend sent me this url last week, it was the first time I saw what
the hell a furby actually was...and I saw the insides first...lol