Tag Archives: backward business model

Todd-Inside

Cover Story: Monster Empire

Clarity in Chaos

Diving into the mind of Todd McFarlane, creator of “Spawn” and business entrepreneur

 

Most know Todd McFarlane for the work he did at Marvel as one of the top-selling artists for Spider-Man, or as the creator of the comic book creature “Spawn” and inventor of official sports figurines so realistic they seem to run, slide or jump right off of their plastic pedestals. One description he hears a lot is “that crazy guy who paid $3 million for a baseball.” However, after spending a few minutes digging into the business mind of McFarlane, supposed chaos turns into methodic choices to create successful opportunities.

clarity_chaos

Pinning down one title that accurately encompasses all that is McFarlane is impossible. He is a Grammy- and Emmy-winning producer and director, creator of one of the best selling independent comics, and official licensed creator of NBA, NFL, MLB and NHL toy figures—just to name a few of his ventures. However, McFarlane will be the first to say few things are impossible, especially in the business world.

“It’s easy for big businesses to fall into flat status quos and comfort zones, so when people come in with a radical idea and break the mold a bit, people get nervous,” he says. “They think if you do something different, it’s an insult to what they were doing before. But there are always other ways to ‘skin a cat.’” For McFarlane, his ways of “skinning” an idea involve what most businesses consider backward thinking.

McFarlane says toy creation is usually a formulaic process. Big businesses meet together, figure out how much money they want to make, come up with a business model and profit margin, and then determine the price of the toy before bringing the idea to artists. The end result—artists end up having to make a better toy for less than the previous one. But McFarlane flips the traditional business model. He approaches the artists first in order to make the best product possible, and figures out pricing later. This business model markets high quality and toy value rather than pricing. “As long as you give people the value of the price on the toy, the price isn’t really relevant,” McFarlane says.

Marketing to the consumer’s interest rather than his/her pocketbook seems to be one of the underlying themes of McFarlane’s success in all of his business ventures.

“Look at the stereotypes of toys and comic books—they equal a kid product. Animation is another one that equals a kid product, however, I rarely sell to kids,” McFarlane says. “We just have a stereotype that says, ‘when I was a kid I watched cartoons and now I don’t watch them anymore.’ The only reason you don’t watch them anymore is because nobody is giving you content that makes sense. So I come in, do ‘Spawn,’ make it R-rated because we’re doing adult theme stuff, and I can sell it to adults. It’s just content. It doesn’t matter how it’s done, it matters what the story is around it.” McFarlane applies the same theory of his comic book “Spawn” to what he does with his entertainment productions and toys.

“I make toys that look like something relevant to a 32-year-old,” he says. “Call it whatever you want, but all of a sudden it makes sense to that person because of it’s content. Ultimately as we grow up, we still buy toys till the day we die. We just convert the toy from a G.I. Joe to a cell phone or fancy car with spinning rims. We [as adults] just don’t want to acknowledge them as toys.”

Another marketing success for McFarlane is asking simple questions no one thinks to ask. “Most of what I do comes from the simple question—why isn’t anyone else doing this? And after awhile I go do it myself,” he says. “Luckily that ‘what if’ question is a question a lot of other people are asking, so all of a sudden you get a lot of credit for doing something there was a hunger for, just no one was feeding the hunger.”

Consumers’ hunger for more realistic sports figures was another easy space to fill for McFarlane. It was just a matter of waiting for old contracts to end, and creating enough buzz to enable him to step in as the new supplier. No amount of buzz could top McFarlane’s move to buy Mark McGwire’s 70th homerun ball from the 1998 season for a record breaking $3 million. That seemingly “crazy” purchase enabled McFarlane to step in as the new official producer for all major North American sports, including football, baseball, basketball and hockey. Another example of his avant-garde business approach is captured by McFarlane Toys’ extensive detail of official sports figures.

“The question isn’t how I got it to look that realistic, the question is how did they not get it realistic for hundreds of years,” says McFarlane. “How do people making a baseball player [figurine] who have access to magazines, TVs, movies, films and sports highlights, A—ignore that information, or B—look at it and still come up with the stuff they did. The real answer is A in most cases. There’s no way you can look at a guy in a costume with wrinkles in it and sculpt a guy in a costume without wrinkles, unless you’re intentionally making that choice.” McFarlane points out consumers became accustomed to bad quality because exclusive contracts permitted only one company to do it. “The only reason people weren’t complaining is because they didn’t think anyone could do it differently.”

But that’s the key to McFarlane’s backward business model—doing what everyone else thinks cannot be done, and doing it in an unconventional way.

“Most people don’t start their own companies. I got it. Most people don’t spend their own money, you’re supposed to go and ask for it somewhere else. I got it. You’re not supposed to do it this way. I got it,” he says. “But that’s what you guys think. It’s my life and I’ll do as I see fit, and I can live every single day of my life without guilt or remorse because I know the success or failure came from my actions and mine alone.”

And for McFarlane that’s the best success of all—freedom.

AZ Business Magazine June - July 2007“I only have one piece of advice, well, besides location, location, location. That’s pretty good. But for everyone out there, try it on your own once,” he says. “Here’s why—if you fail, you can go back to where you came from. Go back to corporate land; they’re waiting for you. But if you go, every now and then a couple of you succeed and that’s freedom. They do these commercials on what’s priceless, but what’s priceless to me is that I get to wake up and make the calls in my life.”

www.spawn.com
www.mcfarlane.com

 

AZ Business Magazine June July ’07 | Next: Accounting Enigma