F.R.O.Y.D. himself has undergone a bit of an image change. By simply glancing at the doll on a retailer's shelf, kids couldn't get his message, Greene decided. So now she's stuffing a one-inch-by-one-inch book in his pocket. Inside, it explains his purpose, but the point of the book is its title, You Can Make Your Dreams Come True, which is plainly visible.
Looking for new ways to get her dolls into children's hands, Greene ran print advertisements in Child magazine's November and December/January issues, at a total cost of $38,512. Aimed squarely at parents, the ad copy reads, "If you would like to encourage your child's dreams and you haven't seen F.R.O.Y.D.'s big yellow nose in your local store, please call or write. . . . " Mindful that many well-known characters are sold mainly through gift stores, she is pushing F.R.O.Y.D.'s nose into that market, too. As a test, she hired two giftware sales representatives last fall.
The rest of her current plan rests on her hopes of licensing F.R.O.Y.D. Those Characters from Cleveland and United Media, which licenses Garfield, have both turned down F.R.O.Y.D. But Greene says they were impressed with him and with her new product: F.R.O.Y.D.'s Really Cool Coloring Book. She won't disclose the details of the novel coloring-book concept, except to say that it involves "no rules and no lines."
The Greenes report that they have talked with people at MCA/Universal and that the studio is exploring the television-show idea as well as the licensing of the F.R.O.Y.D. name for other products. General Mills' snack business is also reviewing the F.R.O.Y.D. concept, says Carolyne Greene. She has already been able to sell one licensing arrangement. Gary Polan, president of Giftcraft, one of the largest wholesalers of giftware in Canada, bought the Canadian licensing rights in 1989. Though F.R.O.Y.D. hasn't been selling well for Giftcraft, Polan has hired a Toronto public relations firm to promote the character.
* * *
But isn't this piecemeal approach too slow to launch the kind of superstar that Carolyne Greene envisions? She insists that it's not, claiming that Xavier Roberts, inventor of Cabbage Patch Kids, sold his dolls in crafts fairs for years before signing a deal with anyone. Still, it's a long haul winning specialty retailers over, individual by individual, especially when you don't have enough money.
With the cash from the private placement running out, she planned to put together an unofficial second round of financing for $150,000 last fall. That would see her through year-end. If sales of retailers' remaining F.R.O.Y.D. stock didn't improve over Christmas and no licensing deal materialized, she would attempt to raise at least another $2 million, either through an additional private placement or by selling a piece of F.R.O.Y.D. Inc. to a larger toy company. The cash infusion would support a major advertising campaign.
Even if she can raise that much, however, F.R.O.Y.D. is no shoo-in. Several retailers wonder if the concept isn't too sophisticated. Bourdon of Toys "R" Us says, "I don't think F.R.O.Y.D. would even be for a kid -- it seems like something an adult might buy."
Meanwhile, Carolyne Greene's image-building strategy eats up a lot of her time in personal appearances. That's a problem when there's only a staff of two. With the initial money raised, Jeffrey Greene withdrew from playing an active role in the company at the beginning of 1990. That leaves Linda Richards, who acts as creative director, secretary, and chief button carrier at F.R.O.Y.D. appearances, as Carolyne Greene's only employee.
Still, sitting in her East 59th Street apartment with its wraparound views of the East River, Carolyne Greene puts her faith in F.R.O.Y.D. As Disney, her Siamese cat, executes a languorous stretch near her chair, she responds to a skeptic with wide-eyed sincerity. "The interesting thing with this business is that it's very much like becoming a movie star," she says. "It takes years, and then all of a sudden it happens. Isn't it amazing how long it takes to become an overnight success?"
EXECUTIVE SUMMARY
The company: F.R.O.Y.D. Inc., New York City
Concept: Sell F.R.O.Y.D. as a doll and licensable character based on its positive message to kids: You can make your dreams come true if you work at them
Projections: Pretax profit of $2.2 million on 1991 sales and licensing royalties of $15.6 million; pretax profit of $20.3 million on 1993 sales and licensing royalties of $62.4 million
Hurdles: Getting distribution through large toy retailers after an initial poor showing; marketing F.R.O.Y.D. effectively without a huge advertising budget; convincing licensing companies of the doll's appeal
THE FOUNDER
Carolyne Greene, president and CEO
Age: 34
Family: Single, no children
Source of idea: While working in fashion design, saw the potential of a licensing strategy applied to the toy business; also inspired by the success of Cabbage Patch Kids Personal funds invested: More than $800,000 with fiancé Jeffrey Greene
Equity held: 74%
Salary: $72,000
Education: Three years at Fashion Institute of Technology, a design school
Other companies started: None
Last job held: Free-lance designer of fine jewelry
FINANCIALS
F.R.O.Y.D. Inc. Operating Statement
($ in thousands) 1990 1991* 1993*
Sales
F.R.O.Y.D. units 60,000 750,000 3,000,000
F.R.O.Y.D. revenues $960 $12,000 $47,900
Accessories and licensing $0 $3,600 $14,500
* * *
Total revenues $960 $15,600 $62,400
* * *
Cost of goods sold $690 $9,400 $37,700
Gross profit $270 $6,200 $24,700
General and $600 $4,000 $4,400
administrative costs
Pretax profit (loss) ($330) $2,200 $20,300
