LA Times Features Wham-O!

Great feature piece on Wham-O in the Los Angeles Times.  Learn more about the company’s history, current state and where it’s headed!

Original post by: Zeitchik, Steven. “Frisbees, Hula Hoops and Hacky Sacks. Southern California’s Wham-O looks to reinvent its toys for the digital age” Los Angeles Times. Aug 09, 2017. Web. Aug 10, 2017.

http://www.latimes.com/business/la-fi-wham-o-20170809-htmlstory.html

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Life was once an easy summer breeze for Wham-O. The Southern California toy outfit, founded in a South Pasadena garage shortly after World War II, churned out Frisbees like pancakes and Super Balls like gumballs.
Its Boogie Board (devised in 1971 by Orange County-bred Bahai surfer Tom Morey) stood sentinel in suburban garages. Only squares didn’t own a Hula Hoop (introduced in 1957; 100 million units sold within three years).

In Wham-O’s television ads, its iconic starburst logo dropped into living rooms like a Super Ball off a third-story balcony.

Times sure have changed.

Of the many entertainment-centric outfits disrupted by the digital era, few have been upended like Wham-O. Its toys, once symbols of an endless summer, are now relics of a bygone season.‎ Even the notion of a firm devoted to plastic playthings feels like an anachronism. Why kick around a beanbag when there’s FIFA Mobile Soccer?

Wham-O has had a rough time financially too. Sales fell sharply from their peak, but were still hovering around $80 million as of 2005, according to public documents and company statements. Since then they’ve slipped further, to less than a quarter of that as of 2015.

But a new set of executives isn’t convinced the company is doomed. Since they took over at the start of last year, they’ve come up with a number of new ideas and, like Super Elastic Bubble Plastic (introduced, toxically, in 1970), set out to put some air in them.

Their plan highlights the tricky and at times unintended consequences of digital change. Fast-hurtling technology may disrupt traditional businesses, but the disrupted have a few adaptive tricks of their own.‎ Yes, Wham-O executives say, they were already carrying a somewhat dusty product line with low upside — and that was even before this slick digital world came along and threatened it with obsolescence.

Yet at heart their products actually operate on a bedrock Silicon Valley (and human) principle: addictive diversions, especially those built around community, never go out of style.

“We think there’s a way to make our products the new cool,” said Wham-O President Todd Richards. “Being outside can be the new iPhone.”

Richards is in his ground-floor workspace at Wham-O headquarters in Carson, an office in a series of low-slung industrial-looking buildings tucked off a main road.

Around his desk lie various distractions — or are they research? A miniature basketball hoop. A water balloon “aqua bow.” Balls, discs and an assortment of flying objects. Richards turns to them when he needs a break from thinking about how to modernize his company, or as inspiration for the same.

Like, for example, the YouTube channel the company has created, in which users can do things like upload videos of their creative (if hardly safety-first) uses of the Slip ‘N Slide.

“Officially the box says under 12,” he said wryly of the watery backyard implement. “Not everyone abides by that.”

Richards oversees a Southland-based staff of about 30 employees. (A second office of about 50 staffers sits in Hong Kong.) The group’s mission: to tweak designs and marketing for the 21st century. At their core, after all, many of their products function the same way as those toys in Grandpa’s basement. But Richards maintains they can be re-positioned for a new audience.

At Coachella this year, Wham-O sent out ambassadors. The emissaries handed out Hacky Sacks (first licensed by Wham-O in 1983; legally required to be present for Phish to perform) and talked to concertgoers about how to master the mini-sphere. The idea was to update the toy’s image ‎from 1990s jam-band staple to 2017 Schoolboy Q accouterment.

As a part of a promotional treasure hunt, Wham-O also recently hid Frisbees throughout Venice, the South Bay and other sandy spots in the Los Angeles area and leaked out clues about where to find them — Pokemon Go: the 175-gram version. (Among the prizes: the chance to interact with executives from the company.)

“A lot of young people would love our products if they got the chance to know what they are. But they’ve never had the opportunity,” said Olyvia Pronin, the company’s director of marketing. “We’re trying to show them what they’re missing by going to wherever they are.”

Or to whatever they’re on. ‎Wham-O is developing a Frisbee app that will essentially allow ‎the disc to be “thrown” from one mobile device to another — all the gratification of backhanding a low slider to your buddy without any of that that running-into-trees messiness.‎

“You’re sitting in a meeting and you say ‘Hey Paul, catch this,'” Richards said, miming a wrist-flick swipe across an imaginary screen.

“And Paul is at the other end of conference room and he looks up and ‘catches it’ just in time.”

After being run as a family business for nearly 35 years — the company was founded in 1948 by USC alums Richard Knerr and Arthur “Spud” Melin, who capitalized on what were then cutting-edge chemical and industrial advances — Wham-O in the last few decades has endured a revolving door of owners, including Mattel, not to mention a series of retail woes.

Richards took over as president when the faltering Wham-O was sold to his privately held Carson-based InterSport and Hong Kong-based Stallion Sport for an undisclosed — but certainly bargain-basement — sum at the end of 2015. The seller was Cornerstone Overseas Investments, which had owned Wham-O for about 10 years and watched as sales cratered.

Richards believes he’s finally hit upon a winning formula. Soft-spoken but physically imposing — he’s a dirt-bike aficionado who commutes to work on his motorcycle — the executive was a vice president of sales for Wham-O in the early 2000s. After leaving the firm, he watched with some consternation as Wham-O under Cornerstone tried to compete using more generic products like beach sand pails.

Richards had little hope he could do anything about that until Stallion’s chief, Joseph Lin, approached him several years ago with word that Wham-O was available. The two parties soon had put together financing and closed the deal. (Lin, Wham-O’s CEO, declined to be interviewed for this article.)

With EBay and other entities driving a huge nostalgia industry — the company has a store on the retail site, should you be in the market for that vintage Wham-O hunting slingshot — Richards made the acquisition under the belief that Wham-O was well-situated and just needed some new energy. He quickly created a startup environment to rethink how Wham-O does business.

The company’s Carson offices feel like a space where employees of a Silicon Valley giant might engage in some much-needed toy-based relaxation from their stressful jobs. Only in this case, the toys are the stressful jobs.

At regular intervals, staffers will gather on the second floor and rain down Super Balls (early 1960s; it’s how the Super Bowl got its name) or head out to the parking lot to try new Slip ‘N Slide designs (1961, all fun and games until little Lucy ends up in an Ace bandage).

In a large room, a handful of toys, including one involving Nerf projectiles, offers a combination brainstorm session/stress-reliever.

“Don’t tell anyone too much about what’s in here,” Pronin said, after allowing a reporter to test-drive some prototypes.

For a mature business like Wham-O’s, the company’s ability to innovate can turn on small tweaks.

Wham-O also is using a crowdsourcing model, hearing as many as several dozen pitches per week from ordinary citizens who think they’ve come up with the next great toy; the ideas sometimes find their way into the company’s product-development pipeline. The idea is to make all outdoor Wham-O toys as ubiquitous as Silly String (invented in 1972, terrorizing New Year’s revelers ever since).

Indeed, digital efforts aren’t the only way Wham-O is seeking to grow. New physical toys have been a priority too.

The aqua bow, for instance, allows for water balloons to be shot a maximum distance of 150 yards, instantly making any family picnic more perilous.

And Richards says a radical new Frisbee design is on its way. He at first doesn’t let on what it is, then eventually some details slip out — it’s shaped more like a square and can thus “self-correct” and fly longer and straighter than the saucer-shaped disc that’s been keeping us and our mutts happy for years.

“It will change everything,” Richards said, flashing the smile of a man about to tell the rest of the Bingo room he’s holding the winning card.

For any Frisbee or Hacky Sack purist who thinks perfection can’t be improved upon, a worthy reminder comes in the form of an Aerobie (not a Wham-O product, to their chagrin). The hollowed-out disc, created on a lark by a Stanford physicist decades after the Frisbee, could coast endlessly on air and made a certain summer camper circa 1987 feel like he had the arm of Joe Montana.

But for all of its ambition, a number of hurdles stand in Wham-O’s way.

With consolidation having gripped the toy business for years, running an independent producer of low-tech toys isn’t simple. The number of retailers has dwindled and shelf space is at a premium. Online sales, meanwhile, can be tricky for a company that depends on consumers holding its products in their hands.

And while the specific style and name of Wham-O toys are copyrighted, their basic idea can be — and often is — imitated by competitors, who can take advantage of modern efficiency tools like inexpensive foreign labor and manufacturing costs.

Not to mention the challenge of competition from new fads the company isn’t behind (e.g., the Fidget Spinner).

Maybe most important, the company is tethered to the past simply by its constitution.

“The downside of [Wham-O’s] business model — in which products themselves attain greater brand equity than their parent brands — is it means Wham-O has a more difficult time with launching new products,” said Clayton Critcher, a retail expert and professor at Berkeley’s Haas School of Business.

“When each product is essentially its own brand, it raises the marketing challenges in pushing new products. It requires Wham-O to launch a new brand with each product.”

Wham-O executives point to a lower standard for success.

“A $100-million company is not big if you’re trying to compete with Mattel or Hasbro, but it’s big for a small firm in Carson,” Richards said, citing an eventual revenue target.

As a private company, Wham-O executives declined to reveal financial information, saying only that they hope to increase sales to that $100-million mark by 2021 and have made significant progress toward that goal.

As it looks to fight its way back onto toy store shelves, Wham-O hopes to take advantage of built-in nostalgia for its name.

Richards likes to tell a story about how magician David Blaine cold-called the company once seeking a massive shipment of Super Balls and freaked out when he realized he was talking to the head of Wham-O.

Executives also think that pro sports’ push for more outdoor play could benefit the company, too. A TV ad for the NFL’s Play 60 campaign, for instance, has stars advocating that kids throw a Frisbee.

Ultimately, though, any digital-age Wham-O revival may come down to an old-fashioned question: Do people enjoy its physical products?

Executives certainly think they will.

“Look at this,” Richards said, as he picked up Super Balls of varying weights and colors and began bouncing them. “Come on. You’re going to tell me anything on a screen is as fun as this?”

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