Pressman Toy Corporation

views updated

Pressman Toy Corporation

200 5th Avenue, Suite 1052
New York, New York 10010
U.S.A.
Telephone: (212) 675-7910
Fax: (212) 645-8512
Web site: http://www.pressmangames.com

Private Company
Incorporated: 1947
Employees: 300 +
Sales: $75 million (2001 est.)
NAIC: 339932 Game, Toy, and Children’s Vehicle Manufacturing

Family owned and operated, Pressman Toy Corporation is America’s third largest games manufacturer. In addition to corporate offices located in Manhattan, Pressman operates a factory in New Brunswick, New Jersey, which produces some 85 percent of its products. Over the years, the company has shrewdly licensed popular film and television properties in order to develop and market best-selling games and other toys, including Disney’s Snow White in the 1930s, The Mickey Mouse Club in the 1950s, hit television game shows Wheel of Fortune in the 1980s and Who Wants to be A Millionaire? at the end of the 1990s, and more recently Spiderman, the successful film based on the comic book hero. The company is run by the second generation of the Pressman family.

1920s Origins

After serving in the military during World War I, Pressman’s founder, Jack Pressman, returned home to launch a Brooklyn toy company. As the nation’s economy heated up and his business flourished, in 1925 he took on a partner, Max Eibetz, to look after the factory while he concentrated on merchandising. J. Pressman & Company’s first major success was the 1928 acquisition of the rights to Chinese Checkers, a game that in fact had nothing to do with China. It was an odd (hence “chinese”) variation of the game Halma, purportedly invented in England during the 1880s and played on a square board rather than the star shape employed by Chinese Checkers. Whatever the truth of its origins, Chinese Checkers proved to be a boon to the fortunes of Pressman, and the company continues to sell the game today. Pressman added other indoor games, such as table tennis sets, as well as building sets and sewing kits for children’s role playing and outdoor items like ring toss and golf.

In the 1930s, Pressman was one of the pioneers in the toy industry in licensing comic strip and film properties. In particular, the company launched a number of products based on Walt Disney’s hugely popular movie Snow White and the Seven Drawfs, the first feature-length animated film. Also in the 1930s, Pressman sold licensed toys based on Little Orphan Annie, a newspaper comic strip created by Harold Gray in 1924. Another comic strip that Pressman licensed was Dick Tracy, launched by cartoonist Chester Gould in 1931.

Pressman reached a turning point in 1942 when Jack Pressman married Lynn Rambach, who became an active participant in the business. Within five years, Eibetz was out, the partnership dissolved, Lynn Pressman appointed vice-president, and the company renamed Pressman Toy Company. In addition, the business left Brooklyn for a larger, modern plant in Patterson, New Jersey, and executive offices in Manhattan. It was Lynn’s influence that led to another major success for the company, the 1956 debut of the Doctor Bag, developed as a way to help children overcome their fear of doctors. Its success led to the introduction of the Nurse Bag, followed by licensed items that drew on the popularity of the Barbie Doll: the Barbie Nurse Bag and the Ken Doctor Bag. Also during the 1950s, Pressman took advantage of other licensing opportunities. It again teamed up with Disney, this time drawing on the new medium of television and another Disney success, The Mickey Mouse Club. A long line of Mickey Mouse club products were offered throughout the decade, as well as other Disney licensed items.

Jack Pressman’s health began to fail in the 1950s, leading to his death in 1959. His widow took over as president, becoming one of the era’s few women to serve in a top management position in the toy industry, the others being Ruth Handler, co-founder of Mattel and inventor of the Barbie Doll, and Beatrice Alexander, the founder of the Alexander Doll Company. Lynn Pressman served as president of the company for the next 20 years. Under her leadership, Pressman became one of the first toy makers to advertise a game on television and to hire fashion designers to design game boxes. She also continued the company’s success with licensed products, including Superman and Lone Ranger games, a product based on the work of television puppeteer Sheri Lewis, and the Big League Action Baseball product, associated with such popular players of the period as Roger Maris, Carl Yastremski, and Tom Seaver.

New Generation of Leadership in the 1970s

In 1971, a second generation of the Pressman family became involved with the business when Jim Pressman graduated with an English Degree from Boston University after having worked summers at the company during his college days. One of his assignments after going to work for Pressman on a permanent basis was to relocate the factory to a larger property. He settled on the current New Brunswick production site and took charge of the relocation, a success that led to his mother appointing him president of the company in 1977, while she maintained the chairmanship.

Jim Pressman took over a business that was generating in the neighborhood of $4 million a year in revenues at a time when the toy industry was undergoing dramatic changes, with many small companies unable to survive a recession in the late 1970s. He took stock of the company and concluded that the strongest part of the business was its games. As a result, he rejected Pressman’s scattershot approach of offering a wide range of products in favor of concentrating on games, in the process abandoning such staples as dolls and doctor’s bags. Board games was a good business because they did not need heavy promotional budgets, relying instead on word-of-mouth. The company carved out a niche with classic board games, supplemented by an ability to spot popular trends and to capitalize on them. Pressman’s timing proved fortuitous, as the board game business was soon revitalized by Selchow & Richter Co. after it introduced its highly popular Trivial Pursuit game, which also helped to break the prevailing $30 price barrier. Once again, it was Pressman’s licensing efforts that proved a key element of success during the 1980s, in particular the home version of the hit syndicated television game show Wheel of Fortune. Pressman’s Wheel of Fortune game grew to become America’s top-selling game, which in just two years helped the toy company to double its annual sales to $30 million in 1985. Pressman then licensed other television game shows to produce board games, including the New Newlywed Game and Jeopardy, as well as launching a deluxe version of the Wheel of Fortune, resulting in revenues soaring to $54 million in 1986. Despite the importance of TV games to its bottom line, Pressman was experiencing growth in other areas as well. More than half of its sales came from traditional games like checkers, Chinese checkers, and ring toss, and family games such as the Charade Game and Topple.

Pressman used some of its profits in the mid-1980s to move into a new gaming category that excited many in the industry, VCR games, spurred by the success of Parker Brothers video version of the Clue board game. Pressman’s entries were Doorways to Adventure and Doorway to Horror, both of which they supported with generous ad budgets. In the end, however, VCR games failed to catch on with the public. Pressman had more success tapping into the rising importance of cable television for game licensing opportunities. In 1988, the company introduced a game based on Nickelodeon’s Double Dare, resulting in another top selling product that grossed over $40 million for retailers. Television game shows, for both adults and children, were such a source of profitable games that the company even toyed with the idea of developing games that could be simultaneously pitched as television properties. One concept that Pressman tried to turn into a television show was a board game called Read My Lips, taken from President George H. Bush’s 1988 presidential campaign, when he vowed not to raise taxes. In the Pressman game, players attempted to read the lips of their partners. The idea, as well as other attempts to launch television game shows, however, proved unsuccessful. In addition television tie-ins, Pressman manufactured a line of strategy games during this period, including Mastermind, Rummikub, and Tri-Ominos. An edgier game introduced by Pressman in the late 1980s was Therapy, in which the therapist asked the player-patient such questions as ‘On a scale of 1 to 10, what is your sexual appetite?”

Company Perspectives:

Pressman Toy Corporation, the third largest games manufacturer in the United States, was founded in 1922 by Jack Pressman. Today, the Pressman Toy Corporation is a leading force in the competitive toy industry, under the direction of Jack’s youngest son, James Pressman.

1990s and Beyond

In 1993, Jim Pressman succeeded his mother as chairman of the company while continuing to serve as president. She now took on the title of Chairman of the Board Emeritus. The retail environment for toys and games was becoming increasingly difficult for small companies, yet Pressman was able to succeed. An industry that was once dominated by a number of toy store chains became overly dependent on a handful of giant retailers, such as Wal-Mart, Kmart, and Target. As a result, fewer items were being stocked, forcing manufacturers to offer fewer products and making them less willing to take a risk: if the big three retailers opted not to carry an item, a manufacturer had a difficult time launching it. Moreover, retailers increasingly adapted a just-in-time approach to stocking its shelves, thereby placing enormous pressure on toy and game manufacturers, who had to truly believe in a product in order to approve the manufacture of a stock capable of supplying merchandisers in the fourth quarter Christmas season, when the lion share of retail business was done. Unlike some of the competition, which was becoming increasingly afraid to take a chance, Pressman had a number of factors working in its favor. The company was well established in the market and had low overhead, allowing it to offer low prices as well as the ability to put out a low-volume game simply because management liked it. Part of the company’s secret to success was its decision to keep its operations low tech. Moreover, Pressman was receptive to ideas presented by independent toy inventors, an odd assortment of characters that the major companies preferred to ignore. Few of these pitch sessions resulted in commercial products, but remaining open to new ideas was a factor in maintaining Pressman’s innovative spirit after being in business for several decades.

Pressman enjoyed a hit in the mid-1990s with Gooey Louie, a game for pre-schoolers in which players remove “gooeys” from the nose of a plastic head until the back of the skull popped open and the brain sprung out. In 1995, Gooey Looey was the best-selling game in its category. The company produced another highly popular game in 1997 with the introduction of Hydro Strike!, a pinball-type game in which players try to douse one another with water by hitting opposing targets with a marble. Hydro Strike! won awards from a number of magazines, including Family Fun Magazine, Sesame Street Parents, and Zillions Magazine, as well as television’s CBS This Morning Toy Test. In 1998, Pressman was active on the licensing front, launching a line of games and puzzles based on the Scooby Doo cartoon program. Also in 1998, the company signed a licensing deal with IDG Books Worldwide, publishers of the For Dummies book series. Pressman contracted to produce three board games: Trivia for Dummies, Crosswords for Dummies, and Charades for Dummies.

Pressman signed a major licensing deal in 1999 when it successfully acquired the rights to produce a board game of Who Wants To Be A Millionaire?, which had become a phenomenal television hit. Pressman beat out industry giants, its track record with Wheel of Fortune Game as well as small company size providing an edge. According to the head of marketing at Celador Productions, the British licensor of Who Wants To Be A Millionaire?, “We were looking for a company that would maintain the integrity of the show, and give it the attention to detail that it deserves. Given their demonstrated success within the game industry and the passion they brought to this project, Pressman was our first choice.” Although sales of the game when it was launched in 2000 were sluggish, at least in comparison to retailers high expectations, momentum picked up and carried through the holiday season. By the end of the year, the home version of Who Wants To Be A Millionaire? was the fourth-best selling toy introduced that year and the number one game in the world. In the process, it garnered a number of honors, including Best Licensed Toy of the Year by the Toy Manufacturers Association. The company was also named Licensee of the Year by Licensing Industry Merchandiser’s Association, and Jim Pressman was named distribution entrepreneur of the year by Ernst and Young. Moreover, the company’s balance sheet benefited greatly from sales of the game. Annual revenues grew to $75 million, approximately a 50 percent increase over the results of previous years.

Pressman followed up a successful 2000 by offering a second edition of Who Wants To Be A Millionaire in time for the 2001 holiday season. A year later, the company added a children’s version of the game. Other popular offerings during this time included Fib Finder, a girl’s lie detector game. Talking versions of Fib Finder as well as Gooey Louie were launched in 2003. Pressman enjoyed continued success in licensing popular cartoon and film characters, including the Power Puff Girls and products based on the 2002 movie Spiderman. In 2003, Pressman hoped to experience similar results from a line of products based on another comic book hero transferred to the big screen, the Incredible Hulk.

Principal Competitors

Hasbro; Mattel.

Key Dates:

1925:: Jack Pressman forms J. Pressman & Company.
1928:: Rights to Chinese Checkers are acquired.
1947:: Pressman Toy Corporation is formed.
1959:: Jack Pressman dies and is succeeded by his wife Lynn.
1977:: Jim Pressman succeeds his mother as president.
1993:: Jim Pressman succeeds his mother as chairman.
1999:: Company acquires rights to produce a home version of Who Wants To Be A Millionaire? game show.