Build It, And They'll Keep Coming

Like all toy categories, construction toys in recent years has undergone its share of ups and downs. Its popularity has waxed and waned due both to its cycle of innovation or lack thereof, and from its fluctuating appeal in relation to competing products looking to capture the same audience: video games and other digital entertainment products that have poached the category's main consumer, post-preschool boys.

Lately, the outlook for construction toys has been generally positive. Category sales fell 1 percent in 2006 to $676.5 million, according to The NPD Group, Port Washington, N.Y. But that was after 2005 saw the building set business top $680.3 million, in the process achieving the overall toy industry's highest rate of growth for the year at 16 percent. The category's combined performance for 2005 to 2006 well outpaced an anemic overall U.S. toy business.

The key to the category's success, according to those deeply involved, is remaining relevant to children's faster-paced lives while staying true to the elements that make a building set appeal to today's children. The solution, they say, is not to concede kids' entertainment dollars to video games, but to find a way to still fit into a life full of digital distractions.

“Today's kids are savvier than ever, and there is an increasing amount of content and activity battling for their attention and time,” says Michael McNally, brand relations manager for Lego, Enfield, Conn. “But our research shows that the typical Lego kid is like most other kids—going online, playing video games, downloading music, watching TV and participating in sports or other extracurricular activities. They still love to build, and fortunately, many of them are multi-tasking—listening to music or watching TV while they build. We see a tremendous overlap between kids who like to build and kids who play video games, both energized by solving a challenge and moving on to the next level. The more we can integrate a Lego experience into a child's multi-tasking lifestyle, or play to their tastes through content and gaming, the more opportunity we have to recruit kids to construction [toys].”

David McCloskey, president of Superstructs maker Waba Fun in Erie, Colo., believes that what's changed most about kids isn't their interest in construction toys—or any toys that take some degree of time and patience to master—it's that their amount of free time has shifted, making it increasingly hard to fit construction toy play into their schedules. “I don't believe the audience [for construction toys] has changed,” he says, “at least insofar as being predominantly boys ages 4 to 11 or 12. But what has changed is the time the audience takes to actively play with our systems. I have only to look at my own family, our boys are involved in many more activities and have so many more toys and options—for distraction and for learning—than we enjoyed. If we want more of their time, we have to compete on today's field, on today's terms.”

For Superstructs, that means targeting its gears-based system to an age demographic the company found to be underserved: kids between 5 and 8. Its 2007 line has been designed to be “fun for a 5-year-old, but also to challenge those a little older or ready for something more,” McCloskey says. The company's newest Superstructs gears sets are compatible with its existing building system and, due to the ability of the gears to drive wheels, “really makes for some amazing possibilities,” McCloskey says.

At Nikko America, the Plano, Texas-based marketer of the Erector system in the U.S., they're doing more than most to ramp up the tech quotient of what for many is considered the grand-daddy of modern building sets. This year's Erector line is led by Spykee, a “spy robot” made from Erector parts that uses Wi-Fi and Skype technology, which lets kids operate a photo- and video-taking webcam on wheels while away from home. It also doubles as an MP3 player and a voice-over-Internet telephone. The company will also introduce a radio-control car, inspired by the 'import tuner' car craze, made from Erector pieces and graphics-covered body panels. It also doubles as an audio speaker for an MP3 player, iPod or other similar device.

“Spykee adds an entirely new level to the construction category,” says Jeff Roberts, Nikko America's vice president of specialty sales for Erector, but at the same time it appeals to older buyers for whom the brand name still resonates. “Many consumers still want that solid, trustworthy brand,” he says.

Other construction toy makers have chosen ways to stand out from a crowded marketplace. Hatfield, Pa.-based K'Nex, for example, is adding traditional Lego-style bricks to its proprietary rod and connector pieces. New York's Curious Toys is tapping into demand for all things dragon-related with its latest Bonz release. ImagAbility, of El Dorado, Calif., is appealing to parents with its “carry along” packaging and activity books. Wooden building set maker Kapla USA, Savannah, Ga., is adding color to its traditionally au naturale system. Zoob marketer Infinitoy, Burlingame, Calif., is going after the preschool market, while Q-Ba-Maze of Minneapolis is targeting the upper end of the category's age with its sculpture-like system.

All of their efforts show just how many ways there are for firms to find their niche in a crowded category struggling to maintain the attentions of kids with seemingly additional entertainment options daily. What helps their mission, says Jacqui Griffith, senior brand manager for K'Nex, is that “there will always be kids who love to build, and we know there really is no limit to the number of sets moms are willing to buy for their children, because they are 'good for you' toys and fundamental to a child's development.”