Toy Train Marketing

[johnnyc]

I just saw the Athearn John Deere HO set at Walmart for $74.99 . I know it's not O-gauge but it's a step in the right direction .

johnnyc

[Anonymous]

The train companies as they exist today cannot supply a large chain like target or walmart. These stores require deliveries on time and complete. As all the train companies today can't seem to hit a delivery date they would get eaten alive from the big box retailers. Also the big guys beat you up on price until you barely make any money per unit, the money is to be made by the volume of units sold so again you have to have the manufacturing process down to produce large volumes of product.

Finally the quality control would have to be stepped up to a level that is alot higher than it is now. Even though I have not had much trouble with the lionel and kline stuff I buy I have seen plenty of posts in the ogr forum lamenting this problem, the same with mth (I can attest to mth's problems personnally) The big boys don't want to sell something that has a high failure rate right out of the box.

As for national exposure that is a big nut to crack, can you see one of these companies shelling out money for a superbowl commercial? I think they have more success releasing licensed stuff like Thomas or Harry Potter( boy I would love a scale hogwarts train!!) Let the name of the latest, hottest fad sell their train stuff.

Anyway just some thoughts I had about this.

[brianel027]

That's a great idea Jon, if they could pull it off. Expensive, I'm sure, but certainly less than national TV ads. And your idea for trailers would be to a targeted audience - the best kind of advertising.

Also think Mike Wolf doing the radio spots is a good idea too. Pennsylvania has always been a very strong railroad state. Pittsburgh is a metro/manufacturing area with a history of coal and steel - and I'm sure lots of train buffs.

[Anonymous]

Jon
I agree Lionel has the chance to really make the PBE take off
if they will? And mabe even the rest of their product line.
Thanks
Keith

[Kooljock1]

I really hope LIONEL has a trailer attached to The Polar Express when it opens in November!

You've seen the movie, now see your LIONEL dealer to buy the set!

Oh well....I can dream can't I?

Jon [8D]

[spankybird]

Hi Marty,
I have also heard the Mike Woffe has been on some talk shows in Pittsburgh. Maybe this is why MTH has so many special Pittsburgh cars.

[MartyE]

KDKA Radio here in Pittsburgh runs MTH ads on the radio fairly regularly. One of the on-air personalities has a nice train layout and has gotten MTH to advertise. Every now and then he even has a special with some O gauge folks on and talks trains.

Every little bit helps.

[spankybird]

Hi all,

K-line as made an effort with the kids starter sets. MTH has also made an effort with Rugged Rails. An engine with PS2 and full DCS for $200.00 list is pretty good when you look at the price of PS2 upgrade kit.

Anyone else have a thought.

tom

[Roger Bielen]

I'd love Lionel, or K-Line, to come to Target, since I got tired of staying home, retired, I started working part time at Target and get a 10% discount. They do carry a good line of Thomas the Tank trains for the tykes.

[Anonymous]

I agree with most points made, and I will add one other. Has anyone seen the price of Thomas the Tank engine cars on Ebay recently? And I am referring to "o" Gauge trains. Plastic freight cars are selling for $45. There is a real demand here and certainly not because of the quality of those cars. I have two sons and a daughter under the age of 7 who love Thomas. Not the NY Central or Pennsy, because they have no idea who these companies were. So why wouldn't Lionel market more Thomas trains in O Gauge, which would then help my kids graduate rom the small wooden trains to the electric ones while still keeping Thomas or Percy, etc. Lionel should be making some profits there unless the rights fee is exhorbitant.

I'd like to see more Thomas selection for the kids, which is what modern day kids like and understand and recognize.

[spankybird]

Hi All,

I like many of the response so far. I also have to agree with many of the opinions. Brain made a point of national advertising. I agree this can be costly, so how does one do this free or next to free.

How about news releases, MTH has pointed out their public displaces to have toy trains seen by the public.

The History Channel, Trains Unlimited, boy do I miss this show. People at work know I am a train nut and often ask me about this show. Maybe we need to ALL ask the history channel to start these again. Maybe even make some new shows. They did do one on the history of toy trains. It was almost all Lionel, but after 100 years, what would you expect. Maybe they could cover the last 10 years to show how it has changed. How many new manufactures there are. How the products have changed. Maybe the manufactures should help by hitting up the History Channel also.

I mention before about QVC and the Train Collectors Junction that they use to have. When I started back into this great hobby, was 3 years after my divorce. I sold my house and was moving. I was shocked and overwhelmed when I found the box with my trains was half empty. My x-wife son sold most of my trains for drug money. I didn’t know about it until I was moving and the box was way to light. My now wife, then girlfriend, wanted to replace some of what I lost and bought me a Lionel starter set from QVC.

I would watch this show and see Lionel sell over 3,000 sets of each type of starter set (at least 3 different ones) in an hours. The one key is to have the product made and ready to ship within a week of the show.

It surprises me how many people watch this show. I live in the greater Cleveland area, where there is a lot of shopping chooses. I do understand when people live in less populated areas really like this show. It is the modern version of the Sears Catalog.

Maybe we should be asking QVC to bring this back, and maybe the manufactures should be working with QVC to sell there product and then they would have FREE National Advertising.


Any one else have other thoughts on this?

Tom.

[brianel027]

I think I've been one of the most vocal opinions on this topic on any train forum. Nevermind all the changes in demographics and society. Nevermind the many more choices for leisure time activities. Nevermind that television watching (VHS, DVD) takes more and more of our time. Nevermind video games.

The train companies do have their own ways of doing business. It's their investment and their money, so they can do as they see fit. I've been told by dealers that it is harder today than it was years ago to be a Lionel dealer. Which is an understatement. That would not only be true of Lionel's requirements to be a dealer, but that the hobby market in general is a very tough business retail speaking. The biggest sellers of trains today are all mailorder businesses. Unfortunately you don't see a train display this way. Funny how many of us adults have fond memories of those dealer display layouts.

National television advertising is astronomically expensive. I know some who would make a joke there: well so are Lionel trains - especially when compared with others. And even more so when one considers the dramatic reduction of production costs by having the stuff made in China. This is starting to be a real problem for the America. Unemployment is up - and not just in manufacturing. And wages (because it is an employers market right now) are substantially down. Benefits don't exist in many cases, or are dramatically reduced when compared to what working folks knew only a generation ago. Many young families I know, with both folks working, don't bring home more than $30-$35K. These young families think long and hard about spending money, especially on something like trains. I know 2 young families this past holiday season who bought HO over Lionel, despite my recommendations. One of them is having second thoughts because the HO stuff is too fragile for his son. But consider the starter line of cars were $16.95 list from Lionel in 1995. Today they're $24.95 - almost a 50% increase in price, despite lower Chinese production costs. Has your paycheck increased 50% in the same period??

And despite all the competition and choices, Lionel is still the name. To most folks, whether it's K-Line or Williams or MTH, they are still Lionel trains. It's just one of those rare things where the name becomes the product, like Kleenex, Fritos or Zerox. How many times do you hear folks say "make me a Zerox copy" even though the machine could be a Konica, Canon or a dozen others. Dealers I talk with say Lionel product still outsells everything else.

I don't think there is any one single simple solution. In the past, I've made many suggestions. I'm certain that Lionel views the logo licensing program as a good move. Probably is... you do see the Lionel name and logo all over the place. Too bad none of those items had some kind of line printed on the packaging about where to find and buy Lionel trains. The PBS series and the History Channel series on trains help. There was the deal between Lionel and Wendy's too.

I think more could be done, but that's not my decision. I do think that the adult buyers have hurt the starter market some. All this new product development costs money. Of course the train companies want to make money. It's the adult buyers with money to burn and the time to vocalize their wishes at YORK two times per year. I doubt any of these new scale items see an immediate return. Companies often use selective pricing to recoop money on new items by charging a little more for everything else. Look at all the new tooling Lionel has done in the past couple years. Or K-Line. Even MTH has admitted to investing $3.5 million into the DCS development - that's a lot of money for a small company. Obviously there's no desire to risk the investment in new tooling for starter items... that or there's no money. This is why the starter items are all from older tooling. Only MTH has done any new tooling for this market. The last time Lionel did with any real effort was the much despised MPC period.

And on the topic of adult buyers... there's this perceived notion that everything from "our" generation is somehow as good as gold. That everything we ever had is somehow collectible now. I saw an ad in the paper for 3 Beatle lp's for $300. I wanted to call the guy and laugh. I've seen prices like that too for trains - trains that are not worth nearly that, but some how the seller thinks they are. The adult buyers want what they want, want it now and want it better than they expect. And expect to sell it for more later on. Even when a new product comes out that is aimed at budget buyers, like the Ready-Made-Toys little Geep loco, the "Beep." First thing you hear is the complaints: "Gee if it only had TMCC." "I wi***hey had put coil couplers on it." You hear the same thing about Williams too. Like there isn't already enough other stuff with these features available. And of course, the older K-Line stuff that was perfectly suited for beginning modelers was "junk." I don't know how many hundreds of times I've heard that one. When K-Line tooled up the new F-7 I remember O Gauge Railroading saying "K-Line finally gets serious." What!? You gotta be kidding? You mean they weren't serious before. I guess that's a Bill Clintonism: "it depends what you mean by 'serious.'" Or maybe that was a polite way of saying the other stuff is junk or for kids, not serious modelers like adults. Even when starter sets get reviewed, there's always the line "this isn't scale." Yep, we adults want it all (just like kids) only the kids don't get to have any trains for them. They're either too expensive or too collectable to be just played with.

Thank goodness K-Line is coming out with more battery powered sets - that'll make for some fond childhood memories. I can see the ads for the future now: "Exactly like the all-plastic Chinese battery powered quality that you remember fondly from your childhood..."

Does anyone ever watch kids play with trains with no adults around? They make their own noises... they play. They pretend. Their version of Railsounds are the sounds they make themselves. They don't count rivets. They don't notice precise scale. They don't run trains prototypically. Come to think of it, probably none of us did either when we were kids. We've just forgotten. Although they do notice paint schemes if they happen to see real trains... "Look, there's the train I have at home." Hmmm, maybe that's why Lionel of years gone by made trains in then-contemporary road names. Of course there was Lionel Lines. But trains were much more a part of life back then. Today if you want kids to connect with trains, you'd better give them something to connect to. You'd think it wouldn't cost much to put out a couple of things in current roads, so the kids can make a bond between their trains and the real ones. Must be the companies research says otherwise. There hasn't been one single affordable starter set in a current modern road other than UP from K-Line or Lionel in over a decade.

Part of it too is the companies are all in hot competition with eachother - all trying to out do the other. This is where the effort is going. At one time, I think K-Line had the best selection and prices for starter sets. Now this is my viewpoint, but probably they felt that it wasn't worth the effort if sales were flat. That and newcomers want the Lionel name. It's not until folks buy the first Lionel set, do they start taking notice of the other options and better prices. All the effort today is on technology and prototype. Which is fine, but it isn't really affordable and it isn't all that reliable either from everything I read.

So where does this leave the kids? Lionel and others say train set and starter related items sales are up. Certainly if a kid gets a train set, he probably isn't going to jump on to the internet and tell everyone in a forum like this about it. Of course adults buy train sets too when they're blowout priced - to break up and sell on ebay. And if sales are up, probably the companies figure they don't need to do anything more. Why invest in new tooling for smaller starter items when sales are already okay? It's no skin off my nose. But the way the hobby is going and the way the adult market reacts to anything that isn't made for them, I say no wonder the kids want to play with video games... they just want to have fun without adults telling them what to do. Or to be careful with that because it's collectible. And they can head to absolutely any store anywhere to have their parents buy more.

Maybe one day while future families are hauling their grandpa's unwanted trains off to the dump because no one knows what they are anymore, you'll see ads on ebay for "Empty Mint Cond. Video Game Box Only" with prices being paid once reminiscent of the very trains being hurled into the landfill.

[pbjwilson]

The toy train manufacturers don"t market to kids. Kids are'nt into trains. I've been buying toy trains since my first child was born 8 years ago. I figured he'd get into it by now and we'd have a nice collection of trains. Well, we have a nice collection of trains! But little interest in playing with them. Even gave him the Alien 51 set a couple years ago and told him they were his trains to play with as he liked. About a week later he had no interest. Gamecube," the devils toy", is all he responds to. So hey adults, enjoy your trains.

Paul the Painter

[Big_Boy_4005]

Coming from the land of Target, I think that's a pretty good idea.

The question is, would Lionel and their regular dealers think so?

How many kids that you know, go into train or hobby stores these days??? If the kids do go, they probably went with dad, and there's the other part of the problem.

Who are they marketing the trains to anyway? EVEN THE STARTER SETS!

Does Lionel view marketing to kids as a lost cause, not worth the cost? TOO MUCH COMPETITION?

Sorry gang, no answers, just more questions.

[ChiefEagles]

They need to hit TV with the Polor Express. That will open the kids minds up. Then they will get them into the market. Run the clip from the web site. That would get the kids looking and asking. Then the Dad's would remeber their train days. Then they would head to the stores.

[Anonymous]

Well, Lionel did have a set selling at Mervyn's (a company in the Marshall Field's/Target family) which I found completely stupid. Mervyn's is mostly a clothing store and is famous for bras not toy trains. Why didn't they market to Target? It's the SAME company but has a toy section.

That being said, I think that Lionel feels they don't need to advertise on TV or sell their product in stores other than "train stores." My local ACE hardware won't even carry Lionel because (and this is not rumor it is straight from the owner's mouth to my ears) there is too much trouble ordering and getting product. Most people see a "catalog" and ASSUME it's a catalog--That is to say a book from which you order merchandise on the pages. As we all know, the "catalogs" should not be called that. They should be called "possible wishbooks of things that may or may not be made and sold and may someday be on a store shelf--WHEW!"

So to have Lionel advertise would not work. They don't do things like other companies. Just imagine if Lionel advertised on TV a starter set with railsounds. Where would the kids have mom or dad run to? Unless you're "into" our hobby, most wouldn't know where to purchase anything.

[cbq9911a]

One of the best ways to market trains is to get them into the stores that people shop at. We need to get trains into Wal-Mart and Target. Failing that, something upscale like Nordstrom or Marshall Field's.

[spankybird]

There have been several comments made about Train Manufacturers lack of advertising, tiring to get the word out to kids.

How many of us remember Lionel TV adds, about 15 minutes long, showing off the new produces for the new year? [:D]

Not to long ago, QVC used to have a show just on trains, G gauge to N gauge. I used to see a lot of Lionel and even some K-line. I remember some of the customers even asking if they would have MTH on someday. Well, they don’t even have the show anymore. [:(]

PBS has a show called Tracks Ahead, which shows both real trains and model trains. [^] But it is on PBS, how many kids watch it?

Maybe we can come up with some cost effective way for our manufactures to get the word out.