Blog #97 — Thursday, June 11, 2020
Posted by Denny Hatch
Sometime in the late 1970s, I submitted a
fanciful article to Folio: The Magazine of Magazine Management about
direct mail. To my surprise, it was accepted, and the editor, Chuck Tannen,
invited me to lunch at a restaurant near his offices in New Canaan, Conn., just
up the pike from my house in Stamford.
Tannen was a lovely, civilized guy; short
with a mop of curly hair and owlish glasses. In the 1990s, Tannen invested in
Jay Walker’s Priceline.com and walked away with a tidy $23 million, which
delighted me.
As we settled down for lunch, I asked Chuck
if Folio were profitable. He wagged his flat right hand and indicated
the answer was comme ci comme ça, or so-so. He then went on to explain:
“Folio is the flagship. It spawns books,
special reports, the big Folio conference, consulting assignments, list rentals and
card decks. When someone in the magazine business buys something from us or
attends the Folio Show, it is our license to go after him and sell him anything
and everything we have. It is our intention to surround the industry.”
Tannen’s line about surrounding the industry
remains etched in my memory. At the time I thought it a brilliant concept. I
still do.
At the Next Table: Three Generations
Many years ago, Peggy and I invited our friends Paul
Goldberg and Joseph Dipper to lunch in Chicago where we were all attending the
Direct Marketing Association Conference. Our hotel concierge recommended NoMI
on the seventh floor of the Chicago Park Hyatt. Our table by the big window
overlooking the iconic Chicago Water Tower. Everything about the restaurant was
world-class—the décor, service, food, wine and vodka (Grey Goose). Dining
doesn’t get any better than that, and I would recommend it to anybody who has
plenty of money or a fat expense account.
The next table was set for three. Lunching
there were a most stylish young suburban matron, her equally stylish daughter—
age about 9—and the daughter’s doll, which was continually being fussed over by
both. The three of them were having a grand time together. Moreover, they were all wearing the same outfit—the mother, the daughter and the doll.
As they were leaving, I asked the lady if the
doll was from American Girl. “Oh, yes,” was the reply. “We have a two o’clock
appointment at American Girl Place to do some shopping for clothes and
accessories.”
American Girl: The Beginnings
In the 1980s, Peggy and I were running WHO’S
MAILING WHAT! out of our house in Stamford, Conn. It was a newsletter based
on the giant archive of direct mail and catalogs acquired from our correspondents
around the country.
I was vaguely aware of the sumptuous,
oversized Pleasant Company catalog offering up-market dolls to little girls. It
was a niche thing, and we included it in our listings, but having neither
daughters nor granddaughters, we never paid much attention.
The American Girls Collection and its contemporary counterpart, American Girl Today, were created especially for girls ages 7 to 12—girls who are old enough to read and still love to play with dolls. For younger girls we offer Bitty Baby, a line of soft, huggable baby dolls, board books and accessories that encourage creative play and nurturing behavior.
At Pleasant Company, we are committed—as you are—to providing your American girl with rich, age-appropriate play experiences. By choosing the right books and toys for your daughter at the right age and stage of her growth, you protect her development, nourish her spirit, and give her imagination wing.
With revenues of $300 million, American Girl
was bought by Mattel in 1998 for $700 million. American Girl did $342.4 million
in 2007, down 28 percent from the prior year. American Girl is a business model of pure
genius that every marketer can learn from. Quite simply, like Folio back
in the 1970s, it surrounds the market.
The Great American Girl Smorgasbord
When Peggy’s niece was between 7 and 12, the
American Girl catalog used to come to the house and long phone conversations
ensued between sisters as to what Aunt Peggy’s gift(s) should be for birthday,
Christmas.
I went to the www.americangirl.com
website and found an eye-popping (and pocketbook-popping) array of delightful goodies and
services: Dolls,
Books, Movies, Furniture, Doll Hospital, Doll outfits for every occasion and Accessories—e.g., Maryellen’s Seaside
Diner ($350), American Girl City Market ($100), Volkswagen Surf Bus ($650),
Julie’s Pinball Machine, Julie’s Pinball Machine ($100), Explore More Luggage
Set ($30), American Girl Pet Boutique ($250).
For several years matching outfits for three
generations were offered.
Wait, there’s more! The Stores!
For the retail experience, American Girl has 17
stores. The flagship is Chicago’s American Girl Place
on the legendary Magnificent Mile—a jaw-dropping collection of attractions:
three floors and a mezzanine offering boutiques, a doll hair salon, doll hospital, theater, bookstore and
clothing for both doll and child,” wrote Alex Kuczynski in The New York
Times. “There is also a bustling cafe, which offers brunch, lunch, dinner
and high tea, and is often booked months in advance.” One of the more amusing
accounts of the American Girl retail experience is by a doting father:
Once a year, as the holidays approach, I
engage in a ritual well known to men of a certain demographic ilk. Armed by my
wife with a shopping list detailed enough to thwart paternal cluelessness, I
enter American Girl Place off Fifth Avenue in Manhattan. And there, amid the
madding throngs of little girls and their mothers, I rush to score the season’s
must-have accessories for Felicity and Samantha. Those would be my daughters’
beloved dolls.
It is not my favorite shopping experience.
But then, American Girl wasn’t created for fathers. And if you are a little
girl or her mother (or grandmother, or aunt), American Girl is, at most times,
a quite breathtakingly attractive amalgam of education and entertainment, all
of it rooted in storytelling.
After a $22 lunch, a $32 revue, a $15 hair styling,
and a $24.95 photo session, plus a few new outfits and a book or two, of
course, you’re talking about a dollstravaganza tab running to several
hundred dollars. Not for the faint of heart. Nor, as I’ve noted, for dads. And
that’s before the package deal with any number of hotels, which (again,
brilliantly) offer turndown service for dolls in their own beds; Wyndham Hotels
throws in a logoed doll bathrobe.
—Keith H. Hammonds, Fast Company,
September 2006
Fast Facts About American Girl
• More than 157 million American Girl® books have been sold since 1986.
• Over 32 million American Girl® dolls have been sold through the company's
catalogue, retail stores, and website since 1986.
• The American Girl catalogue is the largest
consumer toy catalogue and
ranks as one of the top 30 consumer catalogues in the country.
• American
Girl® magazine ranks among the top ten children’s magazines in the
nation and is the largest publication dedicated exclusively to girls ages 8 and
up.
• American Girl's
proprietary retail stores have welcomed over 94 million visitors.
The stores have won numerous awards and are recognized as premier models for
experiential retail.
• The American Girl website, americangirl.com,
receives over 45 million visits per year.
• American Girl's social channels—Facebook, Instagram, Twitter,
Pinterest, and YouTube—reach a combined audience of over 2MMfollowers.
• American Girl has a long-standing commitment to children's
charities nationwide. To date, the company has donated more than $125
million in cash and products.
Takeaways to
Consider
• The glory of American Girl is the customer base—an endless
supply girls reaching ages 4-12 who love dolls with referrals from mothers
and grandmothers—happy alumnae of the American Girl Experience.
• Pleasant Rowland did not start a catalog business or a retail
operation selling individual, unrelated disparate items like so many catalogs
that crashed and burned—Lillian Vernon, Sharper Image and DAK Industries.
• Rowland created a fun and exciting fantasy world that she turned
into a perpetual continuity series. She doesn’t have buyers. She has collectors
bent on enhancing a lifestyle they love.
• Other niche lifestyle catalogs of this ilk: Sporty’s Pilot Shop,
PilotMall.com, Boaters Catalog, Overton’s (Boating Essentials) … you get the
idea.
• Check out the American Girl Web site for ideas that could be
applied to your own endeavors. It is a marvel—easy to navigate, first-rate at
persuading visitors to part with their money, brimming with offers and
opportunities.
• Are you surrounding your industry or marketplace?
• Always think about line extensions—relevant new products and
services to generate more revenue from your existing customers (i.e., get a
larger share of wallet).
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