The company behind the best-selling dolls of the past two Christmases. Crying Babies. And he is the CEO, the architect of the deed. Albert Ventura, who got his first job at IMC Toys, has been running this company based in Terrassa, Barcelona for over 20 years. His key was to move from distributor to producer and more recently, a producer: these babies already have a series on Netflix. They are now working on developing video games, audiobooks, and BFFs, a new line of toys that introduce them to the doll segment for a slightly wider audience. All this in such an unstable economic context that it has already prompted them to change their growth forecasts. Because as they grow, they will grow in the same way.
Tell me about the origins of IMC Toys…
This company was established in 1981 as a toy importer and distributor. We worked with this model until 2000, distributing products such as Mecano parts or Nikko radio controlled cars. This more or less worked, but the model was exhausted and there was a generational change in the company as well: I, until then the chief financial officer, took over general management and proposed another project.
Who was responsible then?
The company was established as a complement to a toy purchasing centre. Shareholders were traders. I actually started out as a finance manager but they immediately offered me to become a shareholder and I also hired shareholder managers during these years. At that time the company was very small: by 2000 we were billing between 7 and 8 million euros, that was another business. The company is 40 years old, but in practice it is 20 and 20 years old.
How did you come to the company?
This was my first job. I am an economist and started working as a manager in the finance department.
Then a lifetime…
I will say that the last 22 years in particular have been exciting because no years have been the same. Now more than ever due to covid and the raw material problem but there were changes every year ago and that is very fun. I might actually retire in a year and I’m not considering retiring because I’m having so much fun. What we’ve been through and what’s to come now is exciting.
What did you raise when you got down to the general direction of the company?
The new project I proposed to the rest of the shareholders was to become a manufacturer: I went to Hong Kong and saw what American companies were doing (which I later learned was a benchmark), which was designing toys in the United States, manufacturing them in the United States. It has centers in China and Hong Kong where they export to the whole world. This was my first strategic plan, to design toys at Terrassa, manufacture them in China and sell them to the world from there.
How was it start?
With very basic stuff. The first license was for 007 (we made radio for example), then for Barbie, so we started manufacturing and selling abroad. We soon found that having subsidiaries was much more functional and in 2001 we set up our first office in Hong Kong; In 2004 we created the first subsidiary in the UK; In 2005 in France… And we’ve always done it the same way: We started with a small office and added more people as we grew. We created one in Germany in 2008, one in Italy in 2014, and the last big jump was in the United States in 2018. In this way, we sell in 60 countries today.
At what point do they start making original toys?
First we started with these licenses, then we started working with Disney, Star Wars, Marvel… We made many licensed products. And in 2017, we entered the doll world with Cry Babies. We’ve launched them in Spain and the UK and have found them to be very successful.
And they created their own series.
If kids are watching shows on YouTube now, why don’t we put money into Disney or Marvel and make the show ourselves? Months later we did a test and found that it was watched a lot. We invested 300,000 Euros during the testing phase and it gave us 20 minutes of content that was very successful. This helped us sell and also brought us YouTube monetization revenue. That’s why we decided to make a real series that could be put on television.
Where is this project now?
We did the second season and it was still going very well, so now we have the third. We associated the series with the products and started selling it on television. The last big step was reaching Netflix.
How did that happen?
We’ve been negotiating for a long time as Netflix wants the series exclusively, but we were interested in checking out the channel. The truth is that we make quite a bit of income from Youtube. We finally reached an agreement and a few months ago it was available in 22 languages and more. In parallel we created an OTT [sistema de retransmisión propio]: If you have a Samsung TV, you can download the Kitoons app and watch the contents there.
Does this new branch weigh too much on your income?
We are in the initial stages of content production. The first season, which was a test, must now be five years old. We started this as a digital boost to sell our product because viewers were dropping so much, and we thought big, in the style of companies like Hasbro or Lego: the important thing is to turn it into a brand like Nenuco or Barbie. They are 50 years and older and continue to provide news about it.
How does the digital strategy go from support to revenue stream? It doesn’t matter how small it is…
Because we saw that there is a monetization resource that can help pay for the series. Consider I’m talking about successful content but we’ve also made it fail and so we don’t continue, but at least it continues to make money on YouTube, so it pays you the initial investment in twelve years, even if the toy is no longer sold.
What are they working on now?
in new formats. If a piece of content is successful, video games, some of which will be released as early as 2023, or audiobooks, which will be released this year, can be made. Also in applications that contain a number of ideas that have not yet been finalized. Additionally, we are now launching BFF (Best Friends Forever). They are a sequel to the aging Cry Babies, and so we enter the fashion doll format to compete in another age segment, here the public is from the age of five. We believe they can go pretty well from the first entries.
What is the strategy in such a situation? Does the drama or the toy go first?
In this case, we made the series and the product at the same time, as it is a continuation of Cry Babies and the risk is low. But sometimes what we do with a new line is launch the toy and make a small digital production with minimal investment. A one-season series can cost around a million euros (subcontracting only), often what we do is invest 200,000 euros in a new line, and only if it works we move on to a second season. There is a lot of innovation in the toy industry, a lot of things that are not right.
Have you made any sales forecasts around your BFF?
We launched them in the G5 (Spain, France, Italy, Germany and the UK) and in the United States and about two million of us, but the United States alone is already one million units.
What does this represent in income?
About 35 million euros.
In general, where is the company?
We closed last year with a turnover of 150 million Euros. 2021 has been a very complicated year for many people due to raw materials, price hikes, shortages, containers, ships, price spikes and port delays like Shanghai even now. . Curious because it has been one of the most complicated years of my life. 2021 is worse than 2020.
Why? Why?
You already knew you could only sell online when we were closed, but I never found myself taking orders that I couldn’t fulfill. It’s most common to have stock and not be able to take orders, not being able to take orders and serve because you can’t produce, or don’t have a ship or arrive late, no. Despite this, we have grown: from 136 million to 150 million, but with a lot of complications. This makes 2022 difficult.
A few months ago you expected to enter 200 million euros in 2022. Does this amount?
We lowered the estimates to 180 million as we started from a lower base. In 2021 we had 165 first and we’re down to 150 million already. The initial budget now gives us 189 million, but we will set it to 180 because there is a lot of fear: If the CPI, consumption, interest rates rise, mortgages will increase… Let’s see how it ends, but it’s not a year of light. Last year there was more demand than supply, this year I think there will be a lack of demand.
Will Cry Babies be the best-selling Christmas doll again?
If I had to make predictions I would say no because three years in a row is too much but that will depend on what is new. It is not a priority issue for me either, what we need to do is to ensure the continuity of the brand and launch new products.