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Simple Treasures

[ 0 ] Apr. 8, 2013 | lisacase

Blythe Jack saw an opportunity in the tween market niche. The veteran marketer who conducted research by walking malls, listened to her nieces and learned what was interesting to them so she could cash-in big.

This entrepreneur saw a wealth of opportunity in simple fortune-telling game.

By Chuck Green

Talk about a transition. After spending most of her career in venture capital, Blythe Jack now operates a company that focuses on products for “tweens,” or girls aged seven to 12 years of age.

Jack, who’d been interested in becoming involved in the operations side of a business, met the founders of a company called Cahootie, the modern-day reincarnation of the iconic, handmade “cootie-catcher” and “fortune-teller” games of the past, through an entrepreneur-of-the-year contest sponsored by Ernst & Young, for which she served as a judge. “While Cahootie wasn’t part of the group I was judging, it was a company I met at that event and the founders said they were looking for someone to take the business to the next level. They said they’d invented the product but didn’t have the capital or expertise of how to grow the business. Since I was looking to do something entrepreneurial myself, it was a good fit,” said Jack, who purchased the business with a partner.

“I thought it was a simple, yet elegant product in its design. I saw this as a chance to create an empowering concept between girls and steer their conversations toward empowering messages and self esteem-building conversation, opposed to what can sometimes transpire at that age.”

Jack had been tracking the tween market in general and watched “from my other career” as an investor in the consumer market the “homogeneity that tween girls tended to follow certain items. I noticed across time that the products that had mixed sensations from the standpoint of tween girl followings were the ones that were really simple and less than $10; something they could afford with their own spending money and that was collectible as well.”

One issue she had is the small market of about six million tween girls. “From the standpoint of retailers who reach those tweens, it’s even a much smaller market, albeit a very concentrated market from the standpoint of interests and likes. Consequently, trying to get to scale at retail can be challenging, especially given the thin product line,” she said. “But one nice thing about having a variety of themes, you’re able to create custom offerings and, given the price point, the impulse nature of it, we’re able to create entertaining offerings for a variety of retailers that might not otherwise carry a tween offering.”

While it can be difficult to get a foot in the door with retailers, Jack was fortunate to have come from a background where her network was “really very deep” within the consumer retail market. “I had a lot of relationships in my network” that were able to facilitate introductions, including to QVC, Old Navy and other retailers.

“We’ve been focused on retailers that catered to that particular demographic. “Justice (Clothing for Girls) is the largest retailer that caters to that demographic, and they’ve been a large customer for us. It’s a place tween girls go to find things that are cool and new, so having placement in stores like that was, in fact, a marketing exercise as much as it was a sales experience.” Jack and her partner also did grassroots marketing through local sponsorship of Girls on The Run, a non-profit for tween girls, as well as philanthropy and product sampling. “Our product is at a price point that makes it easy for us to give product away, and since it has a collectability to it, if girls see one, they want more, so the collectible aspect allowed sampling to work well,” said Jack, whose company had sales of $750,000 in 2011.

To help develop products, Jack did significant anecdotal research, such as following the media, walking malls, understanding color trends. “And I’ve got several tween nieces, so I listen carefully to what’s interesting to them.”

Jack’s background also helped her in her new business. “My understanding of the way retailer relationships work, my network of retailer relationships and other consultants, as well as my understanding of finance, margins, balance sheets, working capital and cash flow were incredibly valuable as far as operating the business efficiently,” said the entrepreneur.

Jack said that since, in large part, Cahootie is a novelty item, she and her partner depend on word of mouth marketing. “For tween girls, it’s being in the right place with the product for them to find it. We don’t have significant budget, so we have to be creative and use the Internet and our sampling, as well as product donations as a way to seize the market.”

CAHOOTIE AT-A-GLANCE

BUSINESS DESCRIPTION: Cahootie’s mission is to expand upon and enhance the timeless and iconic folded paper fortune-telling game that children have played around the world for generations. “Through our award-winning products and online social play space (Club Cahootie), we aim to deliver an experience of fun, learning and connection across family and friends of all ages and backgrounds. Available nationally through Amazon, Justice Stores and select Hallmark stores, Cahootie continues to develop engaging new products for tweens that promote self-esteem through positive messaging and empowering conversation.

EX. OF PRODUCT/SERVICE: 20 themes of “fortune tellers” (or as we call them Cahooties: folded paper game with 40 reusable stickers for tween (ages 7-13) market. Also, Club Cahootie, an online, COPPA-compliant social engagement site for tweens.

HOW WAS THE BUSINESS STARTED: Invented by Jeff Jurgensen (screenwriter of Agent Cody Banks). Acquired in 2009 by Blythe Jack, venture capitalist with vision to grow company as CEO.

CONTACT: The company is based in Irvine, CA and their website is: cahootie.com.

Chuck Green is a writer in the Atlanta area.

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Category: Magazine, Small Business Opportunities, Small Business Opportunities July 2013