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Points of Articulation

Rustin
Rustin Parr
Is Palisades Dead?

This is a conversation I've been having (with virtually anyone who'll listen) for several years now. As the company was peaking (circa Series 2 or 3 of Muppets) they were very close to being my favorite company - something I usually don't have, because, well, I have high standards. In fact my bio page here on OAFE still includes a brief explanation of why.

Through Ken Lilly and his relatable-ness Palisades was on the brink of being the future of the industry. His high level of interaction with fans on their message board really was the future of how a small(ish) company would need to interact with its consumers to survive in this dwindling market. The keyword there is action, too. That board had a real "give and take" feeling to it and I got a really good vibe from Ken there. Most boards seem to me to be more about take than give. No one really has come close, in my opinion, in that very open sense of communication with the fans. The few companies with boards seem to really talk down to the fans - most particularly the Spawn board, which always seemed to be more about "I've got a secret" than "I'll tell you a secret." Again, with Ken, we got a rather in-depth look at the toymaking process from beginning to end. We had lots of input and there was information on that board that we got sometimes months before most websites were reporting it. People just didn't really get what was truly going on there.

Then Palisades started going after more licenses and basically started overpaying. Everyone. For as much trouble they famously had with the pricing/sales of Muppets, it amazes me that they seemed to basically assume that any license would work in that format. They dove into the nostalgia market and pegged their SRP at $15 across the board. Joe Average could afford a $10 muppet figure, and maybe even a $15 Pink Panther or Ren & Stimpy figure, but whereas Joe could have gotten, say, both Statler & Waldorf for $20, it would have cost $30 to get both Ren & Stimpy. The psychology of pricing just didn't check out, and that was the beginning of the end. To this day it still baffles me that they thought Pink Panther or Ren & Stimpy would succeed at retail. Nostalgia figures bank on Joe Average saying "wow, holy crap! Gonzo! How much is this? Ten dollars? I can do that." Then they threw out something more forgettable at a higher price. I mean christ, $15 bucks essentially buys a CD or DVD, or a great meal these days. There's just no way a nostalgia figure found at Suncoast could compete with the latest, say, Vin Diesel DVD, or whatever the hell people actually spend their money on.

Ren & Stimpy was a great line for fans of the show; it was not unlike a wet-dream of toy-ery! But for the casual fan, such as myself, the price point just couldn't justify a really good figure with lots of accessories I wouldn't know what to do with from a property I liked but wasn't in hardcore need of product from. I guess is what I'm trying to say. The best move for the R&S line would have the figures and a log plus one or two accessories hitting retail for $7.99/$8.99, then putting accessory packs, or something of the like for $8-$10 as Palisades Direct exclusives. Pink Panther was the same. Those figures were awesome and a lot of them were things I never thought I'd see toys of, especially good ones, but $15 each/$60 a set it just wasn't worth it, and apparently a lot of other people, as well.

At this point, Palisades Direct was essentially launched, selling various exclusive variants and such, and I thought to myself, "wow, they've gone cutting edge again, they're doing direct sales. True direct sales - if they do this right, this will really be the future of the industry." And I still think it has a very solid chance to be. The problem here of course was that the figures (excepting the Muppet PVCs) were just slight variations of figures already available that were essentially "neat" or "whimsical" as opposed to "fully unique" or "much-needed" by fans. On top of that, they remained at $15, but now you got to pay for shipping on top of that. Shipping is and has always been the real hindrance to online sales for the average public (outside of credit card paranoia), so the smart thing to do would have been to just incorporate shipping into the price tag (well, that and offer exclusives more appealing to a wider range of people). Most people don't need two full sets of the same accessories, so just cut them from the exclusive and sell the figure for, say, $15 with free shipping. In reality the product costs not considerably cheaper, but $15 + free shipping sounds like a much better deal than $10 + shipping. At either rate, more bad decisions killed that angle.

Going off of the Price tag complaints, well... Army of Darkness. What more can one say except for what the hell were they thinking? The moment they announced the license, everyone immediately thought "who cares?" It came at the end of a glut of product from DST and on the waning side of AoD's huge surge in "geekdom" when people were moving on and moving away from AoD. The concept of the line was decent, but the problem is that was an impossible license to launch - a super-articulated, army-builder based, 4"-scale franchise? It had limited exposure to begin with and, as I said, its popularity was waning. Mix in to that a $15 price tag (for two 4" figures!) and it's no wonder we can still find them at Suncoast. Hell the two near me didn't even move any once they were marked down to $1.88 for two weeks! And don't even get me started on Series 2.

When their doomed lines, like Ren & Stimpy started to fail in a big way, the company stopped listening to the fans, or at least just shrugging off ideas. I remember, with the exception of one, maybe two, people in particular (who were into AoD in a big way) a lot of us were very reticent about the AoD line and were vocal about it. Not in mean, harsh ways, but in a calm sort of logical discussion manner like "I'm not sure this is the best thing to do and here's why..." sort of thing. But, with the resigination of Ken, decisions seemed to be made just to spite people. I mean, for Christ's sake, everyone everywhere told Palisades they were making a huge mistake with blindboxing AoD Series 2.

But Palisades did many things that were very smart that other companies should look at as a sort of prototype to build off of in order to really succeed in the market as it stands today and in where it looks to be headed.

Palisades had the most effective (corporate) message board I've ever seen. They pioneered internet sales of their own product (at least in a more effective manner than the McFarlane system), brought accessories back to the forefront of many people's minds, excelled at texturing techniques that really set their products apart from anyone else and, if nothing else, they will always be reminded as the company the created the convention exclusive.

However, mistakes were clearly made that have, by all signs, paved the way for the downfall of the company. I wouldn't say that they are a ReSaurus Part II, becuase my recollection of ReSaurus was that the dissolution came relatively fast and unexpected whereas Palisades' dissent has been very public and very much forseen. But thats an adequate analogy, all things considered. Ken Lilly worked at ReSaurus, and spun Palisades out of its ashes: perhaps with all the money being spent, he recognized the signs from his previous experience and jumped ship before it took him down, too.

I've been asked in a side conversation what my solution to Palisades' problem would be and that answer is very simple and is a sort of battle-cry I have championed all of my life and which still gets me into arguments: lower the SRPs.

The problem is that it seems most people making the toys don't really care. They just keep inching the price point up and up rather than trying to maximize a certain, say $10, price point. At least for certain lines. Smaller companies, like Palisades, are going bust or dropping series becuase they simply can't objectively gage the market interest in a property.

Unfortunately, it appears that "management" took what little proceeds allegedly came in and spat them back in salary increases and licenses acquistions. Thusly, not unlike Mattel, Palisades' overhead is now far too high to get their product out at a reasonable price point, which is truly a shame. Their T2 stuff looks good, and I'm very interested and excited in the announced-but-never-shown Planet of the Apes and Aliens 4" lines. The latter two are perfect candidates for the way that franchise has been set up.

I believe that, in no uncertain terms, next month's Toy Fair '06 literally holds Palisades' fate. If they can't get some big orders and some major retailers on board, I don't doubt we'll never see Zim Series 3, 4" T2, Sesame Street Series 2, or hell, even Sesame Street Series 1.

I think that the industry's days are numbered. Mainly becuase of rising prices. It forces people to pick and choose what's getting bought. For someone with very wide tastes/interests its very difficult nowadays because I can't come close to buying all that attracts me. So in some ways, I end up buying less. I tend to gravitate towards the cheaper stuff, because I can afford more of it, and waiting for sales and the more expensive, which doesn't help the business much at all.

If things continue as they are, I give the industry, as is, 10 years. By then we'll have a very stratified mass industry consisting of Hasbro, Mattel and probably McFarlane, and a very, very specialized industry consisting of SOTA and probably NECA producing single action figures (very comparable to what we see right now) in low numbers and going for well over $20.

The real problem is greed, and until people start making toys to make toys, and not to make money, we're screwed. That's what was nice about Palisades "back in the day," they put out the later series of Muppets at essentially break-even numbers just to get the product out. Now that is dedication, passion, and spirit.

Yes, I'm sad to see them go, they were a great company; but they really brought this upon themselves.


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