Webkinz - When Content Marketing Goes Good (and Bad)

For those of you not familiar with Webkinz, they are very similar to what Cabbage Patch dolls were in the 80's except for the integration of the Internet.  Webkinz, owned by Toronto-based Ganz, are small stuffed animals that come in dogs, pandas, cats, ducks and more. Once the owner "adopts" their pet, they can go to the Webkinz website to register their pet, create a name, and bring their pet to life online.

The Webkinz concept is so simple, it boggles your mind it wasn't thought of earlier. Simple, and truly powerful. To experience just a bit of this power, just watch a four-year-old navigate their way through the site. You have to see it to believe it.

Here are a couple of points specific to the website and content marketing...

1. The Webkinz site may be one of the greatest examples of a successful content marketing website in the world.
2. If Webkinz doesn't realize that their website actually IS content marketing, it may destroy their brand.

The Webkinz Business Model

According to this BusinessWeek article, Webkinz annual sales are north of $100 million. The revenues come strictly from the sale of their stuffed toys and accessories such as charms and clothes. Frankly, the stuffed animals are no different than what you'd find at any toy shop in the world. The difference is its "Webkinz World" online community.

The image to the right is my six-year-old son Joshua's Webkinz, a polar bear named (fittingly) Polar. Joshua (as well as his younger brother Adam) have spent a good chuck of time on the Webkinz site fitting their animals with clothes, toys, carpet and wallpaper for the bedroom, and more. Joshua takes Polar to the doctor, to the exercise room, and to other "social" rooms where Polar can play with other Webkinz pets. Joshua needs to go to the store to buy food for Polar that will keep him healthy, and also has to play Webkinz games as a "job" in order to make money to buy more food, clothes and toys for Polar.

It truly is a wonderfully educational and "sticky" site, and, perhaps the best example I can think of for online content marketing. Webkinz World is NOT the product, it's the retention and growth mechanism. But it ultimately is the reason the brand is what it is today. The online component includes FREE content that educates its customer base and incentivizes their buyers to buy more Webkinz products. Having more pets means your pets can play with each other, and also opens up exclusive items for multiple pet owners.

Webkinz has done what every business in the world seeks to do with their online content, yet they have so integrated the product and the content that it seems indistinguishable. What actually is the product? The toys or the online experience? That is where Webkinz has perfected the art of content marketing. When the content you produce for your customers is perceived as so crucial to the success of the product itself, you have perfect content marketing integration.

A Tragic Mistake

Webkinz recently received a slew of hate mail from parents around the world when they decided to open up a small amount of advertising on their site. This created a virtual PR nightmare for Ganz. Although they have taken the advertising down (such as ads for the recent Seinfeld release "Bee Movie"), they are still considering advertising on the site for "kid-friendly" products.

I can see the storm coming now.

Even in this BusinessWeek quote, it seems that Ganz as well as financial experts just don't get the true nature of the Webkinz World site.

"Ganz, which doesn't disclose its financials, must now strike a delicate balance: maximizing profit from the fad without alienating parents and kids. Visitors to Webkinz.com spent more than a million hours there in November, but the site is free. As a result, "they haven't made anywhere near as much money as you'd think," says Sean McGowan, an analyst at Needham, who guesses Webkinz sales are north of $100 million. He adds that none of the nascent competitors has figured out how to capitalize on kids' Web time, either."

The sales are north of $100 million because Ganz created a safe and educational website that parents can leave their kids on without having to worry. Webkinz has grown because they are delivering high-quality FREE content, with the expectation that the website will drive more Webkinz sales, not that the website will produce revenue itself. Opening up web advertising, no matter how kid-friendly, will kill the brand and the site. Playhouse Disney opened up their website to advertising a few years ago. That was the same time we stopped allowing our kids to go to that site. My kids clicked on those ads like crazy and ended up God knows where. Disney forgot that the website was not there to make money, but to deepen the brand relationship they have with their customers (getting them to watch more playhouse Disney and buy more Disney toys). And from a quick look back at the Disney site, they have removed the advertising.  They figured it out!!!  Webkinz better as well - or they will destroy the safe environment they've created for children.

Key Takeaways

1. All businesses need to create their own content channels, as Webkinz has. Most businesses don't realize that they can create their own online resource centers for their customers that will ultimately drive loyalty and sales. P&G has done it with Home Made Simple, Miller Electric has done it with MillerWelds.com, LEGO has nearly perfected it. Consumer or B2B...doesn't matter. Just create content that meets the informational needs of your buyer, treat it for what it is, and watch what it can do.
2. When content marketing products succeed, such as online content websites or custom publishing print magazines, brands almost instinctively want to open those channels up to advertising. This is almost always a bad idea. Opening up other messages dilutes what you are trying to communicate to your customer. You also lose more control, as Playhouse Disney did when their customers clicked on other websites, alienating parents in the process.
3. The best content marketing doesn't have to be online. In Webkinz case, it clearly is.  Others might be print, or in-person. It's most likely a combination of the three. Successful content programs meet the customers where they are. If you can do all three, it makes the content come alive that much more.

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Comments

[Khatie]

Very informative, thank you for your summary on this business model. I think one thing you could add to takeaway point 1 is that if you are marketing a game, then keep the online content FUN. And if you have a way to enable the consumers to interact with each other you will have a lot more retention; proof of this lies in virtual communities everywhere.

Thanks again!

[Joe Pulizzi - Junta42]

Thanks Khatie...great comment. I agree 100%. Hence, the Facebook concept and it's popularity.

Best
Joe

[Casie G]

I like this post, however, I have to ask, a company that has this great website and opportunity, isn't there another way to monetize it without offending parents or children? You noted that they are still considering 'kid-friendly' advertising which to me seems fine, if done properly. What if the pet store had a poster hanging that featured the Bee movie? I guess I don't see an issue with something like that. If I were them I'd find creative ways to earn money from this huge thing they have created.

[Joe Pulizzi, Junta42]

Hi Casie...thanks for the post.

Yes, I believe that there are plenty of ways to monetize the site, but none of those include advertising. Here's why. Even the most non-offending advertisements, or "kid-friendly" banners, take kids off to other sites when they are clicked on. Those other sites, say even the Bee Movie page, promote other links that take them to less "kid-friendly" sites. I know this from first hand experience. When my 4-year-old was tooling around PlayHouse Disney, he ended up on a Pirates of the Caribbean web site that showed some movie trailers that even scared me. That's what happens when you offer advertising on kid's sites.

So, Webkinz can offer advertising, but in doing so they destroy many things that has created this wonderful brand, including a very safe site for kids of all ages.

My take is to use the wonderful content marketing to promote other products and services, such as accessories, additional learning tools, sponsored sections that don't click to other sites, and new product lines that extend the Webkinz brand.

Thanks again Casie!

[jenna]

this is awesome!

[Carmen]

Yes, that advertising thing on a webkinz site was not a great idea. The whole idea is to have a child stay on the site to care for their webkinz and the participation of the quizzes and arcade games without the distractions. Very dangerous because as you said, you don't know what kind of site your child may end it on. I am quite sure they will come up with other ways to advertise.

[Joe Pulizzi]

Hi Carmen...thanks for the comments. I'm thinking that they may find a way to tie sponsors to activities, but I highly doubt their try to advertise again. Very dangerous indeed, as you mentioned.

Thanks again
Joe

[gymbo]

Not sure if you are interested. But we are having a webkinz giveway.

http://www.thelamberts.com/webkinz_blog/

[gymbo]

Hi,

We are having a cool webkinz give away contest. Thought you might like to check it out.

http://www.thelamberts.com/webkinz_blog/

[Carmen Vj]

Webkinz at still the latest craze and a excellent concept that will work for many years to come. My favorite plush pets.

[renantech]

Good content is nice and readers will love it.. thanks for your informative information.

[Ariel]

co-co-cooooool!!!

[bahman]

This is very informative article. Both my sons were fighting over using my computer to do their daily webkinz chores. I had to by another computer to get them off my PC.

What are your thoughts on zutoon.com?
zutoon allows users to animate simple 3D models and pictures. We used it to animate his school project. http://www.youtube.com/watch?v=rU8UnPRLTPY