Book review: The story behind 'The Great Beanie Baby Bubble'
Your broker thinks your portfolio needs more diversification.
Take a little out of metals, he says, put it into tech. Move money from here, put it there. You hope that's sound advice, but you've noticed that he never mentioned stuffed animals. That's a good thing, as you'll see in The Great Beanie Baby Bubble by Zac Bissonnette.
At the end of 1998, the "richest man in the American toy industry" threw a party for his employees, at which he handed out lavish bonuses and palm-sized bears stuffed with synthetic beans.
The man, Ty Warner, was the billionaire creator of Beanie Babies.
The bears, in coming weeks, were worth more than $5,000 each.
How did it happen that people lost their minds-and their children's college funds-over stuffed animals? Bissonnette tries to find out.
Warner got his start in toys when he got a job at Dakin, a premiere "plush" company; there, he quickly became Dakin's top salesman. When he was caught promoting his own line of plush on Dakin's time, he lost his job; but by then he'd become obsessed with the animals he'd created.
"Warner understood things about toy sales that others didn't," says Bissonnette, and he priced his Beanie Babies at low-cost. That they became a fad with a handful of women in Chicago was a bonus.
Those women were fierce about Beanie Babies, and they called stores around the country, looking for hard-to-find animals and spreading the mania. Salesmen began referring to no-longer-stocked animals as "retired," raising the perception of rarity. People realized they could "flip [stuffed animals] for two to five times" the original price. Word spread and Warner became a billionaire.
But as "people abandoned their senses" and the market became saturated by millions of plush on store shelves, the bubble burst. And, says author Bissonnette, that's still not the end of the story.
As someone who never bought one such toy, I found The Great Beanie Baby Bubble to be a fascinating study of the proverbial madness of crowds. But this well-researched story also serves as a cautionary tale: it's happened before and it could happen again.
Pop-culture fans will find this book delightful and for businesspeople and marketers, The Great Beanie Baby Bubble totally pops.
The Great Beanie Baby Bubble
$26.95, 260 pages