Leapfrog Brand Marketing Plan

1. Team Brands R Us
LeapFrog
Marketing Plan
Team Brand R Us
Tapan Kamdar (tapan_kamdar@mba.berkeley.edu)
Sandeep Shenoy (shenoy@mba.berkeley.edu)
Word Count: 2994

2. Team Brands R Us
LEAPFROG MARKETING PLAN
EXECUTIVE SUMMARY
The worldwide market for toys for kids is estimated to be $78B with the top ten markets
contributing to 65% of the sales1.
Consumer demands have changed drastically in the past five years. Kids are interested in electronic
toys and video games, and parents are interested in making sure kids learn and grow at a faster
pace. The recession has changed consumer behavior for ever – consumers have tried cheaper
products and like them, and are not likely to return to purchasing expensive products2.
LeapFrog has a great opportunity to capitalize on selling learning toys worldwide. By building
multi-lingual toys, focusing on software and entering emerging markets, we expect LeapFrog to
become profitable by 2012 generating revenues of $628M in 2013, a 37% improvement over 2008.
By building toys which provide learning feedback to parents, LeapFrog can build brand loyalty and
command price.
To successfully enter new markets and increase market share in existing markets, LeapFrog will
need to increase marketing spend to 9% of its revenue to $46M in 2011. We recommend spending
advertising dollars on targeted TV spots, social and online marketing, and social responsibility
programs.
1
“Toy Markets in the world”, NPD Group, June 2009
2
“How the recession has changed US consumer behavior”, McKinsey Quarterly, December 2009,
https://www.mckinseyquarterly.com/Retail_Consumer_Goods/Strategy_Analysis/How_the_recession_has_change
d_US_consumer_behavior_2477
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3. Team Brands R Us
MARKTING ENVIRONMENT
Toy business is highly seasonal with significant portion of our revenues occurring in the second half
of the year. The global economic crisis, which began impacting consumer spending in Q3’2008, led
to a severe sales decline in Q4’2008. As retailers reacted to sharply declining consumer spending,
sales in 2009 were significantly lower and generated unusually high retail inventory levels.
The market has been influenced by changing consumer trends on the types of toys demanded by
consumers, the development of 'age compression3' whereby children outgrow toys at a younger age
than the target age and continued demand for safe, electronic and interactive toys4. The video game
industry and social online communities are redefining ways in which children learn and interact.
Toy manufacturers operate in a highly regulated environment which can have a negative impact on
their business, financial condition and results of operations. Leapfrog products have been subject to
involuntary recalls by the Consumer Product Safety Commission5. The Consumer Product Safety
Improvement Act of 2008 requires retailers to remove any sale products that do not meet the new
federal standards for lead and other substances. With 90% of US toy imports from China6, and an
increasing number of Chinese toy recalls, the public sentiment against buying toys manufactured in
China is increasing7.
3
“Age Compression Challenges Action Figure Sales”, TDMonthly, May 2005, Terri Hughes-Lazzell,
http://www.toydirectory.com/monthly/article.asp?id=1306
4
Exhibit 2 and 3 in Appendix
5
“LeapFrog Recalls Electronic Plush Toys Due to Choking Hazard”, U.S. Consumer Product Safety Commission, July
2009, http://www.cpsc.gov/CPSCPUB/PREREL/prhtml09/09286.html
6
“Toy, Doll & Game Manufacturing in the US”, IBISWorld Industry Report, May 2009
7
“Toys Recall: Is China the Problem”, University of Manitoba, October 2008,
http://umanitoba.ca/news/images/toys_recalls_report.pdf
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4. Team Brands R Us
INDUSTRY TRENDS
The Toy industry is in a mature life cycle phase. Demand for toys has been driven by consumers
wanting toys with a 'wow' factor. Industry performance has also been affected by the impact of
cheaper imports from Asia which has created intense competition within the local market.
Increased merger and acquisition activity within the industry has also lead to the demise of
numerous smaller operators. The toy industry has seen an average annual growth of 2% in
revenues and 8% in domestic demand until 2008. Due to the global macroeconomic conditions, the
2009 industry revenues have fallen by 2.5%8 and demand has shrunk by 1%.
Consumer trends in the past 5 years have changed drastically (figure 1). Age compression has
shifted traditional demand to electronic and interactive toys. Core educational toys are favorably
influencing sales of educational toys in the very broadest sense but parents mindful of child
development will make sure that kids have the right “pleasure toys” and educational toys for play.
Toy Cateogries
100%
90% 2.6 3.2 3.2 3.2
80%
Infant
70%
60% Video games
10 9.9 10.5 12.5
50% Plush
40%
Learning
30% 2 1.4
1.4 1.3 Games/Puzzles
20% 0.5 0.5 0.9 1.1
10% 2.4 2.7 2.5 2.4 Action figures
0% 1.2 1.2 1.4 1.2
2003 2004 2005 2006
FIGURE 1: TOY CATEGORY TRENDS
8
“Toy, Doll & Game Manufacturing in the US”, IBISWorld Industry Report, May 2009
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5. Team Brands R Us
Leapfrog has taken advantage of this shift in consumer preferences and has built a strong market
position in toys marketed as electronic learning aids: 20 LeapFrog toys are present on Amazon’s
Top 100 Toys list9 and are on the top 10 Christmas Toys list10.
The demands for toys will continue to be driven by trends in disposable income, changes in
consumer sentiment index, and demand from toy and hobby stores. The decrease in average family
size11, affects the toy industry growth. This has been offset by the increased life expectancy of the
parents and grandparents who are living longer12, spending more on toys and becoming more
accepting of complex electronic toys for their kids.
COMPETITION
LeapFrog competes with major toy manufacturers like Mattel and Hasbro as well as niche learning
toy manufacturers like VTech and Compass Learning. Mattel commands a 40% market share and
distributes brands like Barbie, Fisher Price, Hot Wheels, Matchbox and Disney classic toys13. With a
30% market share, Hasbro sells Playskool, Transformers, Little Einstein, Explore and Grow and 40
other brands of toys14. Nintendo, Sony and Apple’s offerings in handheld games and entertainment
also compete with LeapFrog.
International and emerging markets provide the next frontier of competition to toy manufacturers.
Localized toys address local needs, customs, and languages providing additional value to toy
purchases.
9
Best seller toys, Amazon.com, http://www.amazon.com/gp/bestsellers/toys-and-games?pg=1
10
Best selling toys, 2008, http://www.best-selling-toys.com/top-christmas-toys-for-toddlers-and-preschoolers
11
“Number of People in a family”, The Physics Factbook, Stacey Johnson, 2006,
http://hypertextbook.com/facts/2006/StaceyJohnson.shtml
12
Exhibit 6 in Appendix
13
Mattel, http://shop.mattel.com/brand/index.jsp?categoryId=3768131
14
Hasbro, http://www.hasbro.com/shop/brandlist.cfm
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6. Team Brands R Us
FIGURE 2: TOP 10 TOY MARKETS 15
BRAND MARKETING STRATEGIES
Our recommendations for LeapFrog based on our observations in figure 3 are as follows:
Build multi-lingual and multi-cultural toys which can be sold globally
Increase focus on high margin items such as software titles and games
Increase marketing spend from 7% to 9%
Invest in incorporating Learning Path into all of their products
Acquire innovative learning toy companies such as Melissa & Doug
15
“Toy Markets in the world”, NPD Group, June 2009
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7. Team Brands R Us
FIGURE 3: STRATEGIC LEVERAGE
INTERNATIONAL STRATEGY
In the US, top three retailers (Walmart, ToysRUs, and Target) accounted for 60% of gross sales in
200816 at 40% margin. The international segment represented 23% of net sales at a 36% margin.
Seasonality of sales in the toy industry accounts for 45% of the sales in Q4. Figure 2 indicates
similar US spending patterns in mature markets like Japan, UK, France, Germany and Italy.
Emerging markets like China, Brazil, India and Mexico would provide volume support to sales
where as mature markets would provide premium margins.
LeapFrog should leverage their R&D to build toys which can be sold in most markets by modifying
packaging and language to local preferences. This would increase international sales and improve
respective margins. In addition, LeapFrog should sell toy-specific language discs for a premium in
local markets (e.g. Chinese and Korean discs available in addition to default English/Spanish in US).
16
LeapFrog, 2008 10-K
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8. Team Brands R Us
Doing so would allow parents to expose their children to native and local languages, thereby
fostering language development and auditory interaction.
We recommend entering Japan and China in 2010 and entering India, Italy and Brazil in 2012.
Based on our revenue projections17, we estimate net international profits becoming positive in
2010 leading to an overall profitability in 2012, with international revenues contributing 46% in
2013 (figure 4).
Increased software sales18 will help LeapFrog improve their margins dramatically. The increase in
marketing spending from 7%19 to 9% will thereby only marginally improve LeapFrog’s overall
margins in the short run, but will be a tremendous long term improvement.
2006 2007 2008 2009E 2010E 2011E 2012E 2013E
US 387.70 338.90 363.40 278.39 292.31 306.92 322.27 338.38
Net i18n 114.52 103.50 95.03 73.13 131.30 191.77 239.65 289.81
Net 502.22 442.40 458.43 351.52 423.61 498.69 561.92 628.19
i18n % 22.80% 23.39% 20.73% 20.80% 31.00% 38.45% 42.65% 46.13%
US Profits
Margins 30% 40% 40% 40% 40% 40% 40% 40%
Op. Ex. 232.4 234.9 202.8 192.7 183.0 173.9 165.2 156.9
Profit (Loss) (116.09) (99.34) (57.44) (81.30) (66.10) (51.11) (36.27) (21.57)
International Profits
Margins 26% 37% 36% 32% 34% 32% 33% 34%
Op. Ex. 39.3 39.6 38.8 36.86 35.02 33.27 31.60 30.02
Profit (Loss) (9.52) (1.31) (4.59) (13.46) 9.63 28.10 47.48 68.51
Net Profits (125.61) (100.65) (62.03) (94.76) (56.48) (23.01) 11.21 46.94
FIGURE 4: LEAPFROG PROFITABILITY
17
Exhibit 1 in Appendix
18
Exhibit 7 in Appendix
19
LeapFrog, 2008 10-K
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9. Team Brands R Us
LEARNING PATH & LEARNING SYSTEM
LeapFrog’s position (figure 5) can be defined as follows:
To parents of children 0-14 years, Leapfrog is the brand of interactive and engaging toys that
promises fun and learning, based on award winning toys designed to teach growth skills with
measurable progress.
FIGURE 5: LEAPFROG BRAND ONION
Based on children’s research, LeapFrog focuses on different toys which assist a child’s growth
dependent on their age for their cognitive, emotional, motor, auditory, and language skills. For a
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10. Team Brands R Us
lifelong learning experience, LeapFrog offers phonics based toys for preschoolers and kindergarten,
learning systems for grade school kids and entertainment handhelds for middle and high school
kids. By leveraging their “Learning Path” technology20 and building web connected toys, LeapFrog
can increase their repeat purchase rates21 and increase brand loyalty.
ACQUISITIONS
In the learning toys category, LeapFrog faces direct competition from VTech and Melissa & Doug.
Melissa and Doug toys are famous for pretend toys which allow kids to learn from observing daily
events in life e.g. food sets (fruits, pizza cutting, baking), appliances (stove, fridge) etc. Exhibits 5
and 6 show an increasing number of parents purchasing these toys. Melissa and Doug’s22 brand
essence shows a strong alignment with LeapFrog and fills a gap in LeapFrog’s current product
offering. By acquiring Melissa & Doug, LeapFrog can cement its position in the Learning Toys
category.
TACTICAL MARKETING
In the US, we recommend a two-tiered approach - a consumer focus on the latest toy trends through
consumer advertising and improvement of retail sales through better placement of Leapfrog’s
signature racks at retailers. In Europe, Leapfrog can pursue a similar retail strategy by partnering
with top retailers as Toys R Us and Game Group, while spending bulk of their advertising budget to
increase brand and product awareness23. In emerging countries, by using a pull marketing strategy,
Leapfrog can increase awareness and position it as a premium brand.
20
LeapFrog, http://www.leapfrog.com/en/play/information_center.html
21
Exhibit 4 and 5 in Appendix
22
“Melissa and Doug”, Website, http://www.melissaanddoug.com/about.phtml
23 “Rankings and Profiles of Toys & Games Retailers in Europe”, 2007, http://www.retail-
index.com/HomeSearch/RetailinEuropedatabaseEnglish/ToysGamesRetailersinEurope.aspx
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11. Team Brands R Us
CREATIVE STRATEGIES
To target US and global consumers and to maximize ROI, Leapfrog advertising should present a
“glocalized” message in each country. By familiarizing local and cultural learning aspects, it can
tailor the mix of products, messaging and Leapfrog.com experience for each country. For instance,
parents in some Asian countries pay particular emphasis on learning physical sciences and
mathematics.
By co-branding with global brands as Disney, introducing theme based toys, and showcasing
learning based entertainment, LeapFrog can build a premium appeal and improve product
credibility in new markets. By positioning LeapFrog as an aspiration brand in emerging markets,
LeapFrog can capture the consumer’s share of wallet and mind.
Leapfrog is positioned to offer a unique online gaming experience on Leapfrog.com. By offering free
and fee-based games based on LeapFrog characters and toys, LeapFrog can improve brand loyalty
among kids. The stickiness of the site as a result of gaming will indirectly influence purchases of
other products promoted on the site. Among children, online games can generate strong awareness
for character toys like Leapfrog’s highly popular Scout and Violet toys.
Mobile gaming apps are a relatively inexpensive way to increase brand awareness among adults
with devices that can download mobile applications. Leapfrog mobile games should offer a scaled-
down gaming experience of Didj gaming system and online games for Nintendo DS in Japan and on
phones made by Apple24, Google and Blackberry worldwide.
24
“LeapFrog releases iPhone apps for kids”, Time Out New York, April 2009,
http://www3.timeoutny.com/newyork/kids/blog/2009/04/15/leapfrog-releases-iphone-apps-for-kids/
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12. Team Brands R Us
FIGURE 6A: SCOUT & VIOLET FIGURE 6B: DIDJ GAMING
MARKETING PROGRAMS
Online social marketing will deliver on two goals – brand awareness and advocacy. Using social
networking sites such as Facebook25 and Twitter26 and parent communities through Leapfrog.com,
LeapFrog can receive feedback from users as well as provide advocates with a platform. By
periodically sending information and upcoming toys to Parents, Toys and Gadget bloggers,
LeapFrog can help build sales momentum through the influencers’ channel.
Direct Mail catalogs masked as magazines can provide fun activities to kids and provide a glance of
the latest toys to their parents27. Such catalogs would help generate additional households with
repeat purchases. In addition, Leapfrog should selectively offer discounts based on local purchase
cycles and trends. By incorporating specific coupons in the direct mailers, customers would be
incentivized to seek and share the catalog, bringing in additional purchases.
By participating in Amazon.com’s Frustration-Free packaging effort28, Leapfrog can promote safety
and environment consciousness of its packaging. By promoting social responsibility programs
which encourage and incentivize donating gently used Leapfrog toys for use by children from low
25
LeapFrog’s Facebook page, http://www.facebook.com/#/pages/LeapFrog/111946004581
26
LeapFrog Twitter feed, http://twitter.com/leapfrog
27
LEGO Magazine, http://club1.lego.com/en-US/legomagazine/default.aspx
28
“Amazon Debuts Frustration-Free Packaging”, Inhabitat.com, November 2008,
http://www.inhabitat.com/2008/11/20/amazon-debuts-frustration-free-packaging/
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13. Team Brands R Us
income families, LeapFrog can help under-privileged kids. Partnering with organizations like
Childrenreach.org and CNN Heroes29, Leapfrog can generate goodwill and contribute to children
learning worldwide.
INTERNATIONAL MARKETING AND SALES STRATEGIES
Leapfrog customers are parents with medium to high income levels, educated, computer-savvy, and
interested in accelerate their kids learning. Rapid economic growth in emerging countries has lead
to the growth of a middle-class with significant disposable incomes, higher education and
aspirations for their children.
Leapfrog would enter mature markets in Europe and Japan among existing competition. The
marketing focus in the launch year should be towards creating strong awareness among the
affluent parents by emphasizing their value proposition of learning with fun. The products should
be retailed through upscale retail stores. Once LeapFrog establishes itself in a niche segment, it
should seek to broaden its reach in the market through lower-price products and promotions to
increase market share.
As the products are introduced in newer markets in 2010/2011, the advertising efforts will build
brand and product awareness, mainly through television and print media, complemented by
investments in social marketing.
In emerging economies, Leapfrog must position itself as highly-desired brand through careful
placement and messaging. The products should first be retailed in select metropolitan locations to
suggest exclusiveness and value. Over time Leapfrog can reach out to a larger base by expanding
availability to more retail outlets and offering a wider range of products and prices.
29
CNN Heroes 2009, http://www.cnn.com/SPECIALS/cnn.heroes/archive09/efran.penaflorida.html
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14. Team Brands R Us
MARKETING SPEND STRATEGY
Out of the proposed 2010 advertising spend, we recommend a 52% marketing share for the US and
the remainder for non-US markets30. Social marketing and online spend levels in different markets
have been recommended based on local online involvement levels31. Advertising impressions32
generated by the media spend would help build and maintain the share of voice for LeapFrog.
In the US, the advertising should focus to retain and build market share through existing retail
channels supported by awareness through placements in spot TV, print, and through online and
social marketing33. Spot TV advertisements will generate product awareness among parents and
children in metropolitan areas and can be used to showcase the latest leapfrog toys on networks
like Nickelodeon, Disney, Cartoon Network and PBS Children. Print media advertising will help
increase reach to households that subscribe to parenting magazines. Continuous impressions in
print will help in maintaining a high level of unaided awareness.
American adults are spending just under 4 hours online every day, an 81% increase since 200634.
Leapfrog’s online marketing efforts should be geared to reach the online audience through search
engines and banner ads on popular sites like Google and Yahoo that redirect to Leapfrog.com.
Retail channel represents the bulk of Leapfrog’s sales in the US. By investing in building attractive
store shelves, call-to-action advertisements, and store catalogs, Leapfrog can improve sales
volumes by a huge margin. Leapfrog catalogs advertising discounts and promotions would reach
8M households through direct mail in Q3 and Q4 of 2010 to increase holiday sales.
30
Exhibit 8 in Appendix
31
“Social Penetration 2009”, Global Web Index, December 2009, http://www.docstoc.com/docs/document-
preview.aspx?doc_id=18486230
32
Exhibit 9 in Appendix
33
Exhibit 10 in Appendix for itemized media spend in 2010 in US
34
“Americans greatly increasing time spent online”, Kristina Knight, BizReport, June 26 2009,
http://www.bizreport.com/2009/06/americans_greatly_increasing_time_spent_online_1.html
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15. Team Brands R Us
The media mix is localized to specific market conditions. In countries where e-commerce
penetration is lower, reaching consumers through spot TV ads, print media, retail marketing, and
direct mail will be more effective. PR budget allocated to each country should engage highly
regarded celebrity moms for endorsements and advertising.
MEASURING SUCCESS
In the current digital age, the purchase funnels have been refined into consumption and creation35.
Consumers go through the funnel of awareness, consideration, research and purchase. This funnel
continues on the other side when users use, express and advocate products using the means of
communication available today.
Measuring success for Leapfrog’s marketing strategy consists of two metrics: ROMI for existing
markets and market penetration and ROMI for newer markets. By leveraging social tools and
surveys, we recommend Leapfrog understand the sentiments of its consumers36 and tailor their
messaging accordingly. Figure 7 shows our recommendations to measuring marketing success in
markets where LeapFrog currently does not have a presence. We recommend survey panels of
1500 parents and toy purchasers37, in which brand awareness and consideration are measured
against marketing goals. After the launch year, we recommend using purchase data from point of
sales, coupon usage, and online conversions38 to gauge success. Furthermore, usage of social
35
“Purchase Funnels 2.0”, Matthew Cronin, August 2007, http://webliquidgroup.com/knowledge/purchase-
funnels-20/
36
“Mining the Web for Feelings, Not Facts”, New York Times, August 2009,
http://www.nytimes.com/2009/08/24/technology/internet/24emotion.html?_r=2
37
Similar to Exhibits 2-6 in Appendix
38
Google Trends, http://trends.google.com/websites?q=leapfrog.com&date=all&geo=all&ctab=0&sort=0&sa=N
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16. Team Brands R Us
metrics to evaluate creation of loyal customers and advocates would help further the brand
promise39.
In existing markets, we recommend following launch +1 and +2 strategies in the next two years to
evaluate the business metrics and social health of LeapFrog.
FIGURE 7: BRAND MEASUREMENT
39
“Measuring brand awareness & sentiment in social media”, Dirk Shaw, May 2009,
http://dirkshaw.blogspot.com/2009/05/measuring-brand-awareness-sentiment.html
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SUMMARY
By building “glocal” toys and focusing on connected toys and software sales, LeapFrog can grow
into a global brand of learning toys. Recommended media and retail marketing spend coupled with
targeted spend on social marketing, mobile and online gaming can help LeapFrog can become
profitable and achieve significant market penetration. By being fanatic about fun learning in kids,
LeapFrog can continuously deliver on their brand promise, and in turn become the undisputed king
of learning toys.
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APPENDIX
EXHIBIT 1: LEAPFROG INTERNATIONAL REVENUE PROJECTIONS (IN MILLION US$)
LF Market Share Revenue Projections
Country Net Spending CAGR 2008 2009E 2010E 2011E 2012E 2013E 2008 2009E 2010E 2011E 2012E 2013E
USA 17,310 0.80% 2.10% 1.60% 1.66% 1.73% 1.80% 1.88% 363.40 278.39 292.31 306.92 322.27 338.38
Japan 4,976 0.80% - - 0.50% 0.75% 1.00% 1.25% - - 25.28 38.23 51.38 64.73
China 4,546 3.30% - - 0.50% 0.75% 1.00% 1.25% - - 25.70 38.55 51.41 64.26
UK 3,584 3.80% 0.82% 0.64% 0.67% 0.71% 0.74% 0.78% 29.38 22.94 25.99 28.39 30.91 33.65
France 3,487 0.35% 0.84% 0.66% 0.69% 0.73% 0.76% 0.80% 29.38 22.94 24.21 25.50 26.88 28.34
Germany 2,542 1.70% 1.16% 0.90% 0.95% 1.00% 1.04% 1.10% 29.38 22.94 24.84 26.56 28.39 30.34
Brazil 2,010 1.95% - - 0.50% 0.75% 1.00% - - - 10.65 16.29 22.14
India 1,807 3.30% - - 0.50% 0.75% 1.00% - - - 9.96 15.43 21.25
Mexico 1,728 0.80% 0.40% 0.25% 0.30% 0.35% 0.40% 0.50% 6.89 4.30 5.27 6.19 7.14 8.99
Italy 1,462 1.95% - - 0.50% 0.75% 1.00% - - - 7.74 11.84 16.10
References:
1. CAGR rates: Toys and Games in different markets, DataMonitor, September 2009
2. LeapFrog market share in revenue up to 2009: “Toy, Doll & Game Manufacturing in the US”, IBISWorld Industry Report, May 2009
3. Net spending per market: “Toy Markets in the world”, NPD Group, June 2009
4. Inflation assumption: 1-2% as defined by country trend and projections

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EXHIBIT 2: WHAT BUYERS WANT? EXHIBIT 3: WHAT DO BUYERS PREFE
PREFER?
100% 100%
80% 80%
Highest 60%
60%
40% Yes
High
40%
20% Maybe
Medium
20% 0% Dont care
Low
0% Visual Sounds Interaction
Lowest appeal
(Shapes &
Colors)
EXHIBIT 4: WHAT BRANDS? EXHIBIT 5: REPEAT PURCHASE BRAN
BRANDS
Others, 17% Melissa & Others,
Melissa & Mattel, 24%
Doug, 8% 15% Mattel, 28%
Doug, 8%
Vtech, 15% Hasbro, 18% Vtech, 12%
Hasbro, 17%
Leapfrog,
Leapfrog, 18% 20%
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20. Team Brands R Us
EXHIBIT 6: WHO SELECTS THE TOY? EXHIBIT 7: SOFTWARE MARGINS V/S REVENUE
120%
100%
80%
60% Always
40%
Most times
20%
0% Neutral
Sometimes
Never
Reference: LeapFrog Analyst Report, Stifel Nicolaus, Dec 2009
EXHIBIT 8 LEAPFROG MEDIA SPEND IN 2010/2011
8:
Country Spot TV Print Media Online and Social Retail Mkting LeapFrog.com Direct Mailers PR Country Budget
USA 7,000,000 1,000,000 1,500,000 3,200,000 2,000,000 1,000,000 20,700,000
Japan 900,000 600,000 200,000 600,000 400,000 300,000 3,000,000
China 600,000 200,000 100,000 300,000 400,000 500,000 2,100,000
UK 900,000 600,000 200,000 600,000 400,000 300,000 3,000,000
France 900,000 600,000 200,000 600,000 400,000 300,000 3,000,000
5,000,000
Germany 900,000 600,000 200,000 600,000 400,000 500,000 3,200,000
Brazil 1,000,000 600,000 100,000 300,000 400,000 500,000 2,900,000
India 1,000,000 600,000 100,000 300,000 400,000 500,000 2,900,000
Mexico 1,000,000 600,000 100,000 300,000 400,000 500,000 2,900,000
Italy 900,000 600,000 200,000 300,000 400,000 500,000 2,900,000
Year 2010 37,900,000
Year 2011 46,600,000
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EXHIBIT 9: IMPRESSIONS IN CPM
Country Spot TV Print Media Online & Social Retail Mkting Direct Mail Total
USA 155,556 13,333 75,000 32,000 8,000 283,889
Japan 66,667 26,667 33,333 20,000 5,333 152,000
China 133,333 26,667 50,000 30,000 16,000 256,000
UK 66,667 26,667 33,333 20,000 5,333 152,000
France 66,667 26,667 33,333 20,000 5,333 152,000
Germany 66,667 26,667 33,333 20,000 5,333 152,000
Brazil 222,222 80,000 50,000 30,000 16,000 398,222
India 222,222 80,000 50,000 30,000 16,000 398,222
Mexico 222,222 80,000 50,000 30,000 16,000 398,222
Italy 66,667 26,667 33,333 10,000 5,333 142,000
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EXHIBIT 10: US MEDIA SPEND 2010
Cost Unit Cost Units
Television Network
Nick 2,000,000 25,000 80
Disney Channel 2,000,000 25,000 80
Cartoon Network 2,000,000 25,000 80
PBS Children 1,000,000 25,000 40
Print Media
Parenting, Parents 250,000 50,000 5
Working Moms 250,000 50,000 5
Time 250,000 50,000 5
Family Fun 250,000 50,000 5
Online Marketing
Search Engines 600,000 0.50 1,200,000
Banner Ads
Yahoo 200,000 0.50 400,000
Facebook 50,000 0.50 100,000
Shopping.com 50,000 0.50 100,000
Social Marketing
FaceBook 50,000
Twitter 50,000
Online Gaming 250,000 25,000 10
Mobile Gaming 250,000 25,000 10
LeapFrog.com
Site content 3,500,000 3,500,000 1
Localization 1,500,000 1,000,000 1
Retail Marketing
Walmart 1,000,000 5,000 200
Toysrus 1,000,000 5,000 200
Target 1,000,000 5,000 200
Other outlets 200,000 2,000 100
Direct Mailers 2,000,000 0.25 8,000,000
PR
Celebrity Moms 300,000 100,000 3
Online & print articles 600,000 10,000 60
Bloggers 100,000 4,000 25
Global (not country specific)
Production Budget 2,000,000 2,000,000 1
Social Programs 200,000 200,000 1
Total US Advertising Budget 2010 20,700,000