News

Retailers groove on new youth-skewing karaoke entries

While it may have seemed as if the karaoke industry flamed out with last year's release of the ill-received karaoke-themed flick Duets, toycos are betting that a slew of new tween-targeted music machines will have retailers humming a sweet tune by the time Christmas rolls around. Although the Japanese bar activity has historically been off-limits to kids, a recent drop in production costs has provided a boon to home system sales in the U.S., which sit at US$150 million and have increased 30% annually over the last three years, according to Tiger Electronics' estimates. Throw into the mix a young, increasingly music-obsessed consumer base, and you have the makings of a gotta-have toy on your hands.
September 1, 2001

While it may have seemed as if the karaoke industry flamed out with last year’s release of the ill-received karaoke-themed flick Duets, toycos are betting that a slew of new tween-targeted music machines will have retailers humming a sweet tune by the time Christmas rolls around. Although the Japanese bar activity has historically been off-limits to kids, a recent drop in production costs has provided a boon to home system sales in the U.S., which sit at US$150 million and have increased 30% annually over the last three years, according to Tiger Electronics’ estimates. Throw into the mix a young, increasingly music-obsessed consumer base, and you have the makings of a gotta-have toy on your hands.

With the advent of MP3 and Napster, ‘music has become more accessible to kids than ever before, and the next step for them is role play, which is what karaoke offers,’ says Clarisse Cowdery, a buyer with Ayer, Massachusetts-based specialty toy retailer Learning Express.

Of the group of karaoke systems that toycos will let loose on the public this year, consumers will have plenty to choose from in terms of size, functionality and cost. At the low end of price scale is Hasbro’s e-kara. Licensed to Hasbro by Tokyo-based toyco Takara and tech company SSD, e-kara is a microphone that comes with a built-in karaoke system designed to run through your TV. Music is stored on tiny cartridges the size of micro-cassettes that slide into the microphone’s base. When you plug the e-kara cord directly into your TV, a menu listing six different songs pops up on-screen. Once you’ve keyed in your choice, music will begin to play, and the lyrics will scroll down the screen. All of the controls (such as volume, fast forward, rewind, etc.) are located on the microphone handle, allowing users to make easy adjustments.

‘What sets e-kara apart from the other systems is its portability,’ says Ira Hernowitz, senior VP of marketing at Hasbro. ‘When you’re done, you can unplug it and take it to your friend’s house. It’s really bringing karaoke to the people, as opposed to having this big box that you have to lug around.’ e-kara has already attained hit status in Japan, where it sold one million units last year–a success that Hasbro expects to duplicate State-side. With two tween-targeted karaoke shows on U.S. TV–MTV’s Say What? Karaoke and Fox’s Great Pretenders–mainstream mania for karaoke is cresting at just the right time for Hasbro.

With everyone looking for their 15 minutes of stardom, Hasbro has designed its marketing campaign for e-kara to reflect this cultural phenomenon. In late July, the company kicked off its Star Maker tour, a U.S. promotion that sought to find the best female singers ages eight to 18 in the country. Auditions were held in New York and Los Angeles, and the two winners selected by a panel of judges will be featured in Hasbro’s e-kara commercial, tentatively scheduled to air on U.S. TV later this month or in early October in tandem with the product’s launch at toy and electronics retailers. The e-kara system costs between US$60 and US$70 and comes with one free cartridge. Hasbro is launching with six cartridges (US$20 each), which will contain 10 songs from all genres of music, including karaoke versions of numbers by fave teen performers like Britney Spears and Destiny’s Child. For duet purposes, consumers will also be able to purchase additional mikes, which will retail for roughly US$20 to US$25 each.

The Singing Machine Company, which specializes in karaoke products, is relying on the brand muscle of MTV to attract a younger demographic to its line of licensed machines that launched in July and includes the moderately priced SMGK-1000. Weighing in at 4.5 pounds, the compact system (US$80 to US$100) also runs through a TV, but plays music stored on a text-encoded compact disc or CD+G.

For more serious performers, the company’s other MTV-branded machine offers additional features, as well as a higher price point. Pegged at US$199.99, the STVG-700 comes with a built-in TV screen for lyric display and a tape recorder so you can keep your renditions forever. Both machines also offer multi-mike capabilities. Initially, SM launched with a catalog of 50 discs of popular and contemporary music for US$19.99 each.

‘MTV was a perfect match for us because it’s synonymous with what we do, plus it doesn’t hurt that it airs a show called Say What? Karaoke,’ explains Terry Marco, director of marketing at the Coconut Creek, Florida-based company. Though the professional market had been the bread and butter for the company when it started cranking out the machines 20 years ago, in ’96, it began selling karaoke units exclusively to the consumer market. The move has paid off. The company’s 2001 revenues were up 80.5%. ‘Karaoke is becoming like the VCR. Many people have these machines at home because they’re affordable and they’re fun for the whole family,’ she says.

To draw consumers to its system, Hasbro subsidiary Tiger Electronics eschewed brand licensing in favor of cutting-edge electronics. Though Tiger Karaoke sports a hefty price tag at US$169.99, it is one of the few systems hitting the market this year with MP3 capabilities. Consumers can download music from Tiger’s website (www.tigerkaraoke.com) to their computer, then dump it over to the machine’s hard drive via a USB port.

Tiger Karaoke stores playlists of up to 150 minutes, which can be easily rotated in and out to suit the genre of music you want to hear. Tiger is launching its machine this month with 1,000 songs covering all styles of music that users will be able to download for US$2 a pop. Other features include a built-in LCD screen that will display the lyrics to the songs, three-part harmony capabilities and a gender-shifting button that changes the pitch of your voice; this feature allows men to reach those high notes for ABBA numbers and women to croon real low for Barry White songs. Ultimately, though, Tiger believes the machine’s biggest selling point will be the flexibility it gives consumers.

‘With a lot of systems, you have to buy CDs, and oftentimes there will be only two songs that you like and 10 that you hate. So you’re spending all this money on a CD that you’re not getting full value from. By using the Internet and MP3 technology, we’re giving people the chance to buy only the songs that they want,’ says Marc Rosenberg, Tiger’s senior VP of marketing.

Beyond tech-appeal, Tiger is helping to sell the machine with a multimedia ad campaign that kicked off last month, and beginning in October, it will promote the system via demo events at Wal-Mart’s top 1,000 stores. Promo partner Frito-Lay has also signed on to give away snacks to Wal-Mart customers during the demos.

Also in the US$100-plus range is TAO Music’s iKTV Music VideoCD Karaoke Station. Yet another television-based system (US$149.99), iKTV plays VCDs (video compact discs) containing full-motion video of stock karaoke footage behind the text of the songs’ lyrics. Each system comes with four discs, including Club iKTV, which features karaoke versions of contemporary teen-skewing hits.

TAO Music designed iKTV with kids in mind, says Pamela McCleave, marketing director at the Redwood, California-based company. Roughly the size of a PlayStation video game console, the two-pound iKTV is available in five translucent colors and comes with all of its key controls located on the microphone.

TAO launched iKTV in July, but unlike other companies, it opted for a limited distribution strategy in hopes of establishing the product as a high-end item. iKTV is available at upper-tier retailers like Neiman Marcus, as well as select FAO Schwarz and Learning Express locations.

Though nothing was finalized at press time, promotionally, TAO is hoping to tie into contests with tween publications such as Nickelodeon magazine, Disney Magazine and CosmoGirl. McCleave expects to gain mass distribution for iKTV by next spring, when the company will launch a full-scale ad campaign for the product.

Despite iKTV’s limited distribution, McCleave remains bullish on the sales prospects of the toy, which in Q4 last year, sold 200,000 units in Japan, where it was distributed by toyco Tomy. ‘There’s something great about getting kids and adults into a room and singing,’ says McCleave. ‘It’s the antithesis of what high-tech normally does to us, which is to isolate us from other people.’

About The Author

Menu

Brand Menu