5 Most Financially-Lucrative Toy Fads

By Mack Mikelon | December 23, 2012 AAA

Many parents see the holiday season as the best time of the year to please or appease their kids, usually by purchasing some of the most popular toys on the market. Some children simply want to own the most popular toys so they can flaunt their parents' generosity at school, while other kids may genuinely want to play with these toys. There's a good chance that you'll recognize most of the following toys, all of which were a commodity during the holiday season.

Furbies
These talking, furry, owl-like robotic toys debuted in 1998, with sales of 1.8 million units at about $35 each. The following year saw even more impressive sales of 14 million. From 1998 to 2000 40 million Furbies were sold. Furbies were in such demand that people could sell these toys to last-minute shoppers for three to five times their original value during the holiday season, as these toys were sure to be sold out in most retail stores come Christmastime.
Hasbro's Furbies were programmed to initially "speak" a made-up language, "Furbish," only to use English words as it "aged," creating the illusion that it was learning to speak as it grew older. This illusion was so convincing that the National Security Agency banned Furbies from its headquarters because NSA officials were still under the impression that Furbies could actually record and process information. Furbies are returning for the 2012 holiday season, but with a new modern look and their own App to translate Furbish. The famous toy will be going for around $60 this holiday season.

Tickle Me Elmo
Debuting in 1996, this toy was based on the popular Sesame Street character and would shake and giggle when squeezed. The toy sold out quickly during its first holiday season, as shoppers snapped up the million or so units that were shipped out to retailers. There were even retail-store stampedes of persistent parents who all wanted to grab the toy before it sold out. One of these in-store stampedes led to a Walmart employee suffering a broken rib and a concussion. While the toy sold for about $29 in stores, some early buyers resold the toy for as much as $2,000.

The most recent version of the Tickle Me Elmo toy comes with three interactive tickle spots. This updated Tickle Me Elmo toy slaps its belly, falls forward, gets back up again and falls backwards as it laughs. The latest version of the Tickle Me Elmo toy costs about $150 on Amazon.

Tamagotchi
Bandai's Tamagotchis are handheld egg-shaped digital pets that first arrived on American store shelves in May 1997 at a retail price of about $10. The Tamagotchi was a virtual simulation of a pet on a tiny LCD screen. Tamagotchis required the user to play with, feed, train and groom their pets within the simulation. Bandai sold more than 3 million Tamagotchi units in its first three months and has sold more than 70 million units worldwide since it debuted in 1996 in Japan.

Cabbage Patch Kids
These dolls hit retail store shelves in 1982 and set an industry record at the time with over 2.5 million units sold in its first year. The toy was even featured on the cover of Newsweek in 1983. Much like with Tickle Me Elmo, a large crowd of desperate shoppers created a stampede for Cabbage Patch Kids, which led to one woman breaking her leg. By 1988, however, sales for the Cabbage Patch Kids had dropped and Coleco, the dolls' manufacturer, was $300 million in debt. Nevertheless, 65 million Cabbage Patch Kids dolls were sold between 1982 and 1990.

Bratz Dolls
Hitting store shelves in 2001, these fashion dolls for teenage girls offered an edgier, more urban alternative to Barbie dolls. Some parents accused the dolls of promoting unhealthy body images and dressing too provocatively. Despite the controversy, Bratz surpassed Barbie in 2006 to become the top-selling fashion doll line in the United States. Bratz dolls earned its manufacturer, MGA entertainment, over $1 billion in less than a decade. Mattel, Barbie's manufacturer, first sued MGA entertainment in 2004 for copyright infringement. Seven years later, a jury found that Mattel had actually stolen trade secrets from MGA. The court awarded MGA $310 million. Mattel appealed this decision in March 2012.

The Bottom Line
The above toys put smiles on the faces of millions of children on many a Christmas morning, while the manufacturers of these toys smiled all the way to the bank.

Related Articles
  1. Mutual Funds & ETFs

    Consumer Staples Defend against Volatility

  2. Investing Basics

    Navigating E-commerce: Alibaba, eBay ...

  3. AT&T has enjoyed one of the most successful runs in the history of American business, yet still manages to stay technologically up-to-date, relevant and vital.
    Investing News

    How AT&T Came To Serve A Third Of Americans

  4. With a strong capital surplus and consistently augmenting retained earnings, Comcast continues to represent long-term value for the committed investor.
    Investing News

    This Company Is As Unavoidable As It ...

  5. Many baby boomers are working past 65. Yet as they inevitably retire, effects on workforce participation and consumer spending levels will be profound.
    Investing News

    As Boomers Slow Down, Will The Economy ...

Trading Center