Opinion: Are the “old guys with deep pockets” the lifeblood of the O Gauge hobby?
On 12/29/06 The Record, a northern New Jersey newspaper, ran an editorial response by Peter W. Kruimer that took issue with an Associated Press article The Record ran before Christmas about the model train hobby . Of course, as with most news stories about model trains, the article makes the assertion that model trains are for older men with deep pockets. The article also mentioned that the future of the hobby was unclear because kids are more interested in computers and video games. Peter’s editorial response takes issue with both points and can be read here.
I had originally intended this post to stop at the end of the previous sentence but reading the AP article and Peter’s editorial response provoked me to get up on my soap box and spout a few thoughts of my own.
Click on the link below to read on
Right now, the survival of the hobby is at least in the hands of those with deep pockets. The key demographic right now for the industry are those older males (50 - 55+) who have plenty of disposable income. As many people have stated in the past including Jerry Calabrese, Lionel’s CEO, selling low priced starter sets to many folks is great for the hobby but the real benefit comes when those beginners are converted from casual model train fans into more frequent buyers of model train merchandise. Since the rate of converting a beginner to frequent buyer can be rather low, it makes sense to try to attract more people into the hobby with low priced starter sets and licensed merchandise. But can O Gauge manufacturers attract and convert enough beginners to survive? I think they can.
If you didn’t see the NBC Nightly news with Brian Williams the night the "model trains are making a come back" story ran, go watch it here. In the story the reporter mentions that Lionel’s sales are up 40% and more stores are carrying Lionel starter sets. This is a very good thing for the O Gauge hobby. My assumption and hope is most of the 40% increase in sales Lionel experienced is due to purchases made by those who are new to the hobby.
The $64,000 question for the hobby has always been whether today’s youth and younger adults can be lured away from the almighty computer and video game. My sense is that they can. I don’t think economics is a real factor because most middle class parents will drop $250 on an iPod or $400 - $500 on the latest video game console for their kid (not to mention $40-$60 on additional video games) so spending $200 to $300 on an O Gauge starter set isn’t out of the question. Based on Lionel’s sales stats it seems people are willing to buy what Lionel is selling so more trains will be making it into households. What happens after the trains get home is the key to continued success for the O Gauge hobby.
I had a few neighbors over for drinks this past weekend and, of course, I had to show off my O Gauge layout set up under my family’s Christmas tree. I didn’t expect the two people most enthusiastic about the layout to be females. During our discussion I discovered both had model train enthusiasts in their family who exposed them to the world of model trains when they were young. One mentioned she had tried to get her young boys involved with model trains but failed because she and her husband didn’t have the wherewithal and time to nurture their boy’s interest in model trains.
Thinking back to the conversation, it occurred to me that the chances of infecting someone with the "I love toy trains" bug is much less if the people buying the trains (in most cases parents for their children) are not familiar or excited about the hobby. With computers and video games there’s not much of a need for a parent to nurture a kid’s interest in either one. In the case of a video game all the parent has to do is buy the video game, hook it up to the TV (and maybe not even that) and the drama and excitement of the game unfolds in front of the kid without any more involvement from Mom & Dad.
O Gauge trains, on the other hand (especially those without digital sounds, which most sub $200 set lack), are best experienced when the mother, father, brother, sister, uncle or friend, who is enthusiastic about trains, plays trains with the child. I know from my own experience that if I had set up an oval of track around the Christmas tree but didn’t get excited about the trains when I ran them with my son or daughter, their interest level would diminish quickly. Instead, I’m wildly enthusiastic about model trains, change my Christmas layout every year, take my kids to train shows and watch toy train and real train videos with them. My daughter’s interest in trains is much less (she likes Barbies and Princesses) but my son eats, drinks and sleeps trains.
Before I had the conversation with my neighbor, I took for granted that most people buying model trains for children would be able to nurture a child’s interest in model trains and, of course, be interested in the trains too. Well, that’s not always the case, in fact, I’m bet many starter sets get set up under the tree for a year or so then get packed away once the children are older to never again see the light of day.
Right now, Lionel’s and the other O Gauge train manufacturer’s bread is buttered by those "old guys with deep pockets". But those old guys need to do more than just buy trains. They need to do as much as possible to spend time with their brothers, sisters, sons, daughters, nieces, nephews, friends, etc. to nurture interest in the great hobby of model railroading. Back in the day when railroading was king in America it was the steam trains themselves that nurtured people’s interest in miniature versions of the behemoths they saw or rode everyday. Today that is not case. The Thomas the Tank Engine franchise has experienced tremendous success with children because it has a show to nurture their interest. Model railroading needs a similar catalyst to spark the interest of today’s youth and enthusiasts need to continue to be a good source for the spark.
O Gauge manufacturers also have to come up with innovative ways to provide the spark. Using unique marketing techniques like getting the Discovery Channel interested in running a documentary about the making of a model train, or producing a blog that follows and documents trials (no pun intended) and tribulations of the design and production of a new locomotive would be great ways to draw attention to the hobby. A better web presence with web sites that are fast, easy to use, and showcase products, i.e. product videos, are absolutely necessary to cater to the next generation of internet savvy buyers. Helping brick and mortar shops build a web presence is a must too. Continuing to land more licensing deals to attract non-model railroaders to the hobby seems to be a good formula. Developing one standard digital control system among O Gauge manufacturers (I know this is a stretch) that is open source so the computer savvy buyers of the next generation can develop their own interfaces and controls would be fantastic. Donating trains to schools and encouraging local hobby shops to work with educators to have students build a layout as a school projects will get trains in front of more children and adults. And how about producing more interesting sub $200 starter sets. If my son’s $19.99 4×4 toy truck can play several songs, play different engine sounds and move by touching buttons, why can’t some of that same inexpensive technology show up on locomotives and rolling stock in a sub $200 starter set? Throw a few buttons on the tender or rolling stock that activate sounds or lights. Develop some neat battery powered accessories that talk or perform some action at the touch of a button. Not everything has to be activated from or connected to the track or transformer. Parents are very accustomed to having a stock of batteries on hand in the house because every toy requires batteries these days. And lastly, MTH and Lionel have to settle the trade secrets lawsuit and move on.
Train shops also need to step it up. A toy shop near me has a Thomas day twice a year and invites parents to visit with their children and play with Thomas the Tank Engine toys. Model train shops need to do similar things. I don’t know of one train shop in my area that hosts or sponsors any extra curricular activity to try to promote the model train hobby. I’m sure some shops around the country do but they are the exception. I rarely if ever see local ads on TV or in print promoting model trains. And most train shops lack a decent, informative website.
Supposedly one of the reasons "brick & mortar" train shops are on the decline is becasue the Internet is stealing business from them. I don’t buy that local shops can’t compete with the Internet. Most of the local shops I frequent do absolutely nothing to leverage the Internet because their owners don’t want to invest the time or money. Those that do will succeed because the future will require that all shops compliment their brick and mortar stores with a very good Internet presence.
Many news articles about the hobby suggest a gloomy future for model railroading. The future will be gloomy if everyone involved in the hobby and industry fails to come up with new and innovative ways to promote the hobby. Sure, there are lots of people and organizations out there promoting and sharing the hobby right now but we need to do even more. Model railroading may never enjoy the popularity it did in the mid part of the 20th century but there will be plenty of interest going forward if enthusiasts (with shallow or deep pockets), manufacturers and hobby shops all do their part to promote the world’s greatest hobby.
My kids are certainly too young to have deep pockets, and their father’s pockets are fairly shallow right now too :). I’ll bet there is a good chance both my son and daughter will put up trains around their family’s Christmas tree when they’re older because I share my enthusiasm about model trains with them. Who knows, they may even spread the "I love toy trains" bug to their children and turn out to be one of those old guy/girl model train enthusiasts with deep pockets.
UPDATE: Be sure to read the comments left by OGaugewatch readers below. Feel free to add your own $0.02.
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5 Responses to “Opinion: Are the “old guys with deep pockets” the lifeblood of the O Gauge hobby?”
Its interesting how Associated Press could run an article on “needing deep pockets” for a hobby, such as model railroading, and ignore that a video game console could cost $600.00 and over $60.00 per game, and only last about 3 years before a next generation replaces it. The train layout in the article is around for 18 years. I wonder in 18 years how many people will be playing their PS3.
You have it right in this post, its about “infecting” others. I like trains, I like video games, I like hobbies, and so do my kids. We are passionate about them, and so was my Dad. Anyone who visits my house gets the tour of all my toys. And they usually leave either thinking I am crazy, or picking up an interest they had but never followed.
By the way, you can be in model railroading for only a few bucks. Its called V-Scale - check out my post on V-Scale, A Real Hobby?
http://blog.thehobbyguy.tv/2006/09/22/virtual-railroading-a-real-hobby-cmon/
Keep up the great posts.
Posted by: TheHobbyGuy | Jan 7, 2007 at 12:58 AM
I had to mention too, It was you, Mr. O Gauge Watch, that got me to actually purchase an O-Scale MTH Christmas Trolley set. I was never into O-Scale until reading your blog. So keep it up! great work!
Posted by: TheHobbyGuy | Jan 7, 2007 at 1:00 AM
I think the BEEPs are the best intro to the hobby for shallow pockets… however, they don’t have a steamer model yet, and they are condemned to transformer control, currently (I will bet RMT will be the pioneer of DCC into 3 rail).
However, I usually take a box of realtrax, a DCS TIU/remote/txfmr, and several engines + my santa fe railking chrome cars to my parents house for my nephews to play with over the holidays. They LOVE DCS and don’t care too much for conventional control (though control of conv. locos with DCS remote + TIU is acceptable!). They like the remote since they can interact with the train no matter where they are at on the tracks. Their favorite is my PS2 Premiere UP FEF 811 (as is mine :)). It can run hard and fast, and crawl. At Christmas, I brought a RK Hudson (another favorite of mine, too), and they fell in love with it as well. However, add up the costs and a FEF for ($1000 new) + DCS ($300) + transformer ($50) + cars (from set, estimate $200) = $1550. You can drop that to $950 using the hudson instead. That is not cheap. It is way more than a deluxe xbox 360 and some games.
Kids could get into trains easier if the big “2″ started to do sets that include their digital control systems with a very simple remote (my nephews get the layout confused every now and then, because they accidently push unintentional buttons — well the 4 year old anyway :)). The TIU only needs one channel, the remote needs a mode which constrains it to the engine on the track at the time. The price can’t move up…
So, if the O manufacturers can get inexpensive wireless with a simple interface, and command control in a inexpensive but reliable engine, then I think they could make more inroads.
As for the lawsuit — it won’t be over till green blood has been shed. I side with MTH based on the emails that were discovered, however, it will continue to drain money from both companies as it continues to drag on. I hope that Mike Wolf will not damage his company irrecoverably to win.
Posted by: David L Pearce | Jan 8, 2007 at 12:01 AM
I just stumbled on to OGW by accident and found the above article interesting. Long story short, I grew up living in Ramsey, NJ in the 50s and early 60s. My father was a model railroader that occasionally built layouts and such for Railroad Model Craftsman magazine which was also located in Ramsey. Needless to say, I had the perfect upbringing and imprint for model railroading. I live and work in the midwest now, working on and producing shows for National Geographic, Discovery Channel, History Channel and so on.
I have watched most of the videos and TV shows (The DYI Channel) associated with model railroading and I think they mostly miss the mark on providing inspiration to renew the craft. They are geared to selling product to existing user base. Plus, I don’t think the manufactures understand what Discovery needs to have a program run on their channel.
Last summer I worked on a film for Harley Davidson to inspire a new generation riders. Harley has the same problem as model railroading. The average age of a Harley owner is getting higher every year and a lack of new riders to fill the void. Their solution was to identify what it means to be a Harley rider and tell that story with heart through the eyes of old and new riders. The film can be viewed from their web site, it will be setup for continueous public viewing in all their stores worldwide and I believe it will be available for sale.
Perhaps model railroading can take a lession from that. A documentary that provides historical information, bind the three generations of railroaders together with heart and offer an inspirational pathway to the future. Have the manufactures distribute that to Hobby shops and web sites and better yet make it work for Discovery or the History Channel and work off that.
Either way it is a long haul. Occasionally I make it to Caboose Hobbies in Denver and have opportunity to chat with the sales folks. While a large portion of their business comes from the Internet they have seen a renewed interest in Lionel trains, especially the action items. I guess what works for the automatic milk car in 1957 still works in 2007. My two cents….
Posted by: Jay Roman | Jan 8, 2007 at 1:10 AM
I’m 62, retired and do NOT have deep pockets! What I do have is my Lionel trains from the 40’s & 50’s and some electro-mechanical repair skills. The trains had only seen the light-of-day for a brief period in the late 70’s when our two young sons expressed some interest in them. Several years ago I pulled them out of storage to provide entertainment for our grandchildren during visits. The four oldest, three boys and one girl ages 4 to 6 now, are absolutely enthralled by sights and sounds of three trains running simultaneously on my layout. Our oldest son has been bitten by the hobby and begun a HO layout for his four children AND himself. I spent very little money between e-Bay, the local hobby shops and on-line shopping to achieve this level of satisfaction. As with anything else in life, moderation is good and excess is bad! These were originally and still are toys to be played with, not collected.
Posted by: Bill Ellis | Jan 10, 2007 at 11:18 AM