HONG KONG (Jan. 26, 1:30 p.m. ET) — The classic American plastic yo-yo is becoming big business in China.
With savvy promotion by Chinese toy companies, the market has grown from barely a blip six years ago to one of the largest, with one U.S. firm saying China is now the world's top selling yo-yo market.
As with cars, where China rose quickly to become the biggest market worldwide, the new popularity of yo-yos is getting noticed by foreign companies.
The largest yo-yo maker in the United States, Duncan Toys Co., recently launched its first products for China and the company sees significant opportunity.
“In China, in the last eight years, it's gone from nothing to the most yo-yos sold in the world,” said Mike Burke, national sales and marketing manager with Middlefield, Ohio-based Duncan, in an interview at the Hong Kong Toy Fair in mid-January.
Check out a video interview with Duncan's Burke at the Hong Kong Toy Fair.
Duncan — a division of Baraboo, Wis.-based plastics firm Flambeau Inc. — set up an office in China in 2009. It hired former Chinese national yo-yo champion Luo Jianbin for market development and last year received a China sales license.
It's not the only U.S. yo-yo maker there. YoYoFactory in Scottsdale, Ariz., sells its yo-yos, complete with in-store video displays showing tricks, at Toys R Us Inc. stores in China.
The Americans are playing catch-up with their Chinese competitors, even though globally Duncan was the first to mass-market yo-yos in the 1930s.
The rise of China's yo-yo market began in 2006 when one of its largest toy makers, Guangdong Alpha Animation and Culture Co. Ltd. in Guangzhou, launched a TV show called Blazing Teens, Duncan's Burke said.
The cartoon and live-action show has episodes lasting 24 minutes that revolve around teenagers from different schools in yo-yo competitions.
“It was the first TV promotion done in China about yo-yos [and] it really exposed Chinese kids to what a yo-yo is,” Burke said. “In the U.S. we couldn't do that. It would cost too much money. But in China you can.”
There have been more seasons of “Blazing Teens,” including very popular episodes two years ago, Burke said: “It was astronomical how many yo-yos were sold in 2010.”
Alpha, which sells under the Auldey brand name, says it is China's only company to vertically integrate manufacturing, including 190 injection molding machines, with animation, marketing and licensing.
During a visit to a Toys R Us store in Guangzhou, a reporter observed that Auldey had much more shelf space than any yo-yo brand. Industry officials said it is China's largest yo-yo maker.
Alpha, in a statement to Plastics News, said that China was a small market for the yo-yos in 2006, with only serious enthusiasts even aware that the toy existed. But now it's definitely a mass-market product, with “Blazing Teens” a big part of that growth, Alpha said.
The competition seems to be heating up. Auldey plans to host a championship competition in China this year that will be the largest in Asia Pacific and attract players worldwide.
The 19-year-old company has big ambitions: Its website says it wants to be a Chinese version of Disney, branching into businesses like theme parks to “disseminate the outstanding Chinese culture … all over the world.”
It already has versions of “Blazing Teens” on TV or does yo-yo promotions throughout Asia, including India, Indonesia, Turkey, the Philippines and Malaysia. Total company sales from yo-yos and other products totaled 903 million yuan ($137 million) in 2010, with profit of 148 million yuan ($22.4 million).
Duncan, for its part, has been in Asia for almost a decade, starting with Japan in 2003 and adding Singapore, Malaysia, Hong Kong and the Philippines in 2005. Today Asia makes up only about 15 percent of Duncan sales. The company has teams of skilled yo-yo players, the “Duncan Crew,” in each of its markets, and they often work with local Toys R Us stores, Burke said.
“We believe Asia is probably the best continent for us to grow our business worldwide,” he said.
Even with a market developed by others, the company believes it can compete in China, where aficionados know its name.
Besides hiring Luo to help get access to the best Chinese players and generate media attention, Duncan brought Hank Freeman, three-time U.S. champion and last year's world yo-yo champion, to China for its October launch.
Burke said he thinks Duncan's quality can help set it apart.
That includes using polycarbonate for 95 percent of its plastic yo-yos, which he said makes them more durable. (In the U.S., more than 90 percent of yo-yos sold are plastic, although metal is gaining popularity, Duncan said.)
The company pays close attention to its injection molding so the plastic flows well and makes a solid, balanced yo-yo without wobble, a big problem for cheaper versions, he said.
Yo-yos had a technology upgrade in the 1990s, adding ball bearings that allowed hundreds of new tricks to be invented and jazzing up competitions to sport-level so they could be televised on ESPN, Burke said.
That has helped keep the 80-plus-year-old toy relevant. But Burke said it could be a tougher climb in China, where Duncan cannot rely on nostalgic adults who had its yo-yos as kids and now buy them for children and grandchildren.
“I still believe we have the best-known brand throughout the world, with the exception of China,” he said.