The primary difficulty with making a profit from the preschool market is that products must pass the crucial parent test first before they reach the kids for whom they were developed. Mom and dad can be the choosiest of consumers when it comes to their impressionable preschoolers, and their standards are understandably high. They want wholesome products that will teach their child values and good judgment, they want inventive products that will stimulate their child’s imagination and creativity, and increasingly, they want high-tech products that will give their child an edge in the competitive and ever-advancing world of computer technology.

For this reason, interactive products may stand a better chance for survival than most on the preschool market. ‘Parents know more than ever before that their kids are going to grow up in a society in which the computer is the most important tool available,’ says Ralph Guiffre, executive vice president of marketing and licensing for Humongous Entertainment. ‘Preschool kids approach new things in a totally wide-open way, so a computer is no more daunting to them than a telephone. Parents are realizing that early exposure to computer technology is going to pay off for their kids in the future.’

Guiffre estimates that his company currently depends on the preschool market for roughly 30 percent of its total sales, but with the first-ever Blue’s Clues software titles for preschoolers scheduled for release by Humongous in September, that figure should increase substantially. According to PC Data figures for April, Humongous had the two best-selling education titles with Freddi Fish 3: The Case of the Stolen Conch Shell and Pajama Sam: No Need to Hide When it’s Dark Outside.

Guiffre speculates that the preschool market for software could experience a significant expansion in the next couple of years, and points to the considerable presence of games for that demographic in PC Data’s top-selling software charts as an indication of this coming trend. ‘When you look at the charts, there are an awful lot of preschool titles in the top 20, and we all know that the titles at the top do a significant amount of the total software business,’ he says. ‘The preschool market is strong, and it’s only getting stronger.’

Video game producers are also starting to recognize the revenue potential of the preschool market. Alpha Software and New York-based NewKidCo are working on two Sony PlayStation titles starring Sesame Street characters for kids age two to six (see KidScreen’s June 1998 issue, ‘Video game company targets kids two to six,’ page 18). NewKidCo founder Hank Kaplan has crunched the numbers, and feels confident that the preschool market will prove to be lucrative. ‘Thirty percent of North American households have a child under the age of six, so, eliminating those with infants, we’re dealing with a potential market of between four and five million households,’ he says. ‘Kids have been responding to Sesame Street for the past 30 years . . . , but most importantly, many parents grew up with the show themselves and will feel comfortable exposing their kids to Sesame Street subject matter in a video game format.’

You know that an interactive trend is official when IBM jumps on the bandwagon. On the hardware side of the preschool market, the mothercorp of the computer industry has teamed up with Rubbermaid’s Little Tikes division to create a learning computer center for preschoolers, starting at age three up to seven. Introduced in April, the Young Explorer center comes bundled with software from IBM’s Edmark subsidiary, but the terminal can run any Windows-based software. This product follows on the heels of an interactive learning keyboard and software package for preschoolers called Wonder Tools that was released by Compaq and Fisher-Price in November 1996. The joint venture ended abruptly just seven months later.

‘Kids love it because they know it’s built just for them,’ says Michelle Riggs, IBM product marketing manager.

Since its release in April, Young Explorer has been successfully distributed to school systems, hospitals and daycare centers for a price of US$2,300, but the true test will come in December when the system hits retail in the U.S. for the holiday season. IBM hasn’t yet decided what it will cost at the retail level.