Innovation in a Doll Company? – Command Post by LaunchX

You may not immediately think of a 40-year-old doll brand when you think of innovative companies. Yet, American Girl dolls brought a creative strategy to their doll repair program that generated revenue, created a good experience out of a bad situation, and propelled the brand forward as a leader in the toy industry. For those unfamiliar, American Girl dolls are 18-inch (46 cm) dolls meant to represent historical fictional American characters. These dolls come with accessories and a story meant to shed light on some American historical event. These dolls do not come cheap. The price for a new 18-inch doll today is around $150. That doesn’t even mention used dolls! Those in good condition from the ’80s and ’90s can fetch $1000+ on eBay! American Girl has created a reputation for quality dolls that last a long time and retain their value—even passing dolls down to kids as a type of heirloom. However, no product is exempt from accidents and abuse that people cause. When you have a product like a doll whose primary audience is children, eventually something bad will happen to the doll. Companies often plan on products failing, providing warranty services like the legendary AppleCare or Telsa’s convenient car service. Yet, American Girl took a different approach altogether. When an American Girl doll is broken in any way, you can choose to have her “healed” at an American Girl Doll Care Center. The term “healed” is used here because there is a lore around their atypical doll repair service. When your American Girl doll loses an arm because your neighbor’s dog bit it off, you don’t have to neglect the damage or throw the doll away. Instead, American Girl encourages you to send it to their Doll Care Center to have it fixed. Depending on the damage, you can spend anywhere from $45 to $88. But this isn’t your run-of-the-mill repair service. When you send in the doll, they will provide – But it doesn’t end there. The true moment of magic happens when the doll is returned. Not only is the doll refurbished, but it comes back with – With the option to spend even more and add on – First, no one wants their doll to break, especially a young child, yet it is an inevitable part of owning a toy. American Girl recognizes that the worst will happen and plans accordingly to ensure that a child can keep their doll even after an accident. But the brand goes further. They invented a shared fiction where the doll is actually going to a hospital. They included all the artifacts (certificate, get-well card, hospital bracelet, and gown) to reinforce the story for the child. This strategy takes a bad experience for the child – sending off their beloved doll for 2 weeks, and turns it into an experience that kids look forward to. Psychologically, the Doll Care Center presents its product as valuable enough to repair for a premium. It could be argued that when someone repairs the doll, it is perceived as more valuable because there is a sunken cost beyond the original purchase price – solidifying the premium value of American Girl dolls in people’s minds. To top it all off, it gives American Girl the chance to upsell to customers, offering other items that perpetuate the story of the hospital visit. It creates further value around the doll in accessories, with the ability to update the customer’s address in the database and have them revisit their website – encouraging even more sales. At the core, innovating at a company is primarily about making changes that improve the company. One key improvement area is making the customer experience phenomenal to generate deeper customer loyalty. Though technology companies usually get all of the spotlight for innovation, it is clear that every company – including a doll company – can create an innovative experience that makes a magical experience for the customers while making the company more profitable. What companies could take a page from the American Girl doll’s book and bring a new twist to a common customer experience?