#245: Crazy Aaron’s Secret Formula for Perfect Putty with Aaron Muderick
Have you ever wondered how a simple office toy evolved into a toy phenomenon?
In this episode of 'Making It In The Toy Industry', host Azhelle Wade sits down with Aaron Muderick, the creative mind behind Crazy Aaron's Thinking Putty. From a child's love for tinkering to creating a renowned brand, Aaron's journey is a testament to innovation, persistence, and passion. He discusses the importance of staying connected to your audience, maintaining product quality, and the critical lessons learned in balancing growth and focus.
Learn about the unique steps of toy design, the challenges of innovation, and what it really takes to succeed in the competitive toy industry. Aaron’s insights offer a behind-the-scenes look at toy development that every aspiring creator and toy enthusiast will love. From inspiration to production, this is an episode you don’t want to miss!
Listen For These Important Moments
00:36 Aaron's Journey: From Silicon Valley to Putty Innovator
02:35 The Slime Craze and Establishing a Permanent Footprint
04:02 Developing Thinking Putty for Adults
05:13 The Accidental Discovery of Putty
07:24 The First Steps to Entrepreneurship
09:27 Scaling Up: From Office Pool to Retail Success
15:51 The Importance of Focus and Specialization
19:41 Sustainability and Local Manufacturing
25:01 Navigating the Slime Craze
30:48 Quality and Consistency
35:19 Innovations and Future Trends
-
This episode is brought to you by www.thetoycoach.com
-
[00:00:00] Azhelle Wade: Making it in the toy industry, episode number 245. Hey there, toy people! Azhelle Wade here, and welcome back to another episode of Making It In The Toy Industry. This is a weekly podcast brought to you by thetoycoach.com. Today's guest is Aaron Muderick, the innovative founder behind Crazy Aaron's Thinking Putty. From a childhood passion for tinkering to a successful career in Silicon Valley, Aaron's journey took a creative turn when he discovered a love for putty.
[00:00:45] With no formal training in chemistry or business, somehow Aaron built Crazy Aaron from the ground up, creating a line of thinking putty and other compounds that inspire creativity, curiosity, and fun. Through persistence, innovation, and a deep connection to his customers, Aaron has managed to outlast trends that came in and came out like our slime craze.
[00:01:06] And today he's here to share his insights on staying relevant in a fast moving industry. Aaron, welcome to the show.
[00:01:13] Aaron Muderick: Thank you, Azhelle. Thank you for having me.
[00:01:15] Azhelle Wade: Aaron, to kick this conversation off, can you finish the sentence for me? The thing that surprised me most about the toy industry was
[00:01:22] Aaron Muderick: It's adults making the decisions.
[00:01:25] Azhelle Wade: Really? Wait, that was surprising.
[00:01:27] Aaron Muderick: Yeah. I mean, you invent and create with it sort of a childlike wisdom and wonder.
[00:01:32] Azhelle Wade: Yeah.
[00:01:34] Aaron Muderick: But really it's buyers and then parents. And then eventually, hopefully you can reach a child and ignite their passion.
[00:01:42] Azhelle Wade: Yeah. I remember there being an inside joke when I started working where people would say, toy designers don't design toys, Walmart designs toys.
[00:01:51] Aaron Muderick: I don't know that I would go quite that far, but it's, but depending on the company you work for, it may be more or less true.
[00:01:57] Azhelle Wade: No, yeah, that's true. Like the more masks that are just kind of chasing whatever the buyers want, just want to make them happy so they can stay in that space and don't care about integrity or don't have their own vision for their brand. That's the biggest thing. Yeah. You're totally right on that.
[00:02:11] So I'd love to start out talking about you're in the compound side of the toy industry. There was a huge craze, I think it was around 2018, for slime. You are a staple. You're not a fly by night slime operation, you know? So, how did you establish such a permanent footprint in an area which some might have seen as a trend, not here to last?
[00:02:37] Aaron Muderick: Sure. Many thought it would come and go. I always thought they'd be wrong. It was just, I really loved what I was doing. And when you look at the business, which has been 26 years. The first 12 were making thinking putty, figuring out how to make it, how to develop it, how to make it unique and different, and push the envelope of what was possible, the innovative form factor, the big handfuls, but none of it was selling to children.
[00:03:04] It was a hundred percent selling to grownups who sit at their desk and need stress relief. It wasn't until 2010 that I was dragged sort of kicking and screaming into it, exhibiting at Toy Fair and taking on wholesale toy stores as customers. So had really good bones. It had been proven and had been proven in a very unorthodox way that grownups liked it.
[00:03:29] And traditionally compounds were sold really focused on children. Like the slimier, the gooier, the goopier, the grosser, the better. And thinking putty wasn't any of those things. And I guess, you know, even more people liked it once it started showing up in retail.
[00:03:44] Azhelle Wade: Would you say it was easier for you to develop thinking putty for adults than, versus kids?
[00:03:51] Aaron Muderick: Well, it was easier in the sense I wasn't developing it for adults. I was developing it for me.
[00:03:55] Azhelle Wade: Right.
[00:03:56] Aaron Muderick: me personally, as something to play with at my desk, because I was coding and as a software engineer, I was very fidgety. I needed help. So I was solving my own problem. And if you are a designer and you're sort of 110 percent into you solving your problem, you're going to do a good job, right?
[00:04:14] You really understand it. You didn't miss a market trend report. You are the market.
[00:04:19] Azhelle Wade: Right.
[00:04:21] Aaron Muderick: And then entertaining and amusing my coworkers and my friends and my family and sort of that circle of people around me and then in 2010 entering the toy business with a toy that had been established. But now we have to learn.
[00:04:34] Okay, you know, How do I make this merchandisable on a retail shelf? It's not just sold on a website. How do I communicate its properties to people who aren't hearing about it virally from their coworker, but actually need to see a retail box and understand what they're looking at why it's different, why it's new why it's better? That was that journey from sort of 2010 onward.
[00:04:54] Azhelle Wade: Well, we've talked before about how you were working as a software developer when you created Crazy Aaron's and you said that this discovery for putty was accidental. How did this happen?
[00:05:06] Aaron Muderick: Well, it was me being fidgety and having a hard time sitting still for, you know, eight to 10 hours a day doing my job. And so sort of still being fairly young, I was 23 you know, just getting some toys, going to a Zany Brainy, which was a East Coast toy chain at the time. And, trying different things.
[00:05:26] Trying to figure out like what would entertain me? What would keep me engaged? And it was that egg of putty. That was the thing that as much as I loved it, it was too small. I wanted more. And it sent me down a crazy hole to figure out how to make it, how to make it better. Of course it would not be inexpensive to buy lots and lots of them.
[00:05:44] And I was young and poor and thought maybe if I learned how to make it, you know, I could move up the supply chain, so to speak, and get it a little cheaper.
[00:05:51] Azhelle Wade: So you had no experience in chemistry, but you,
[00:05:54] Aaron Muderick: zero. In fact, my high school. The year before I took chemistry, the school board voted to remove chemistry lab because it wasn't required by the state.
[00:06:03] So we just flipped through a textbook.
[00:06:05] Azhelle Wade: How did you use your background in tech and computer science to figure out how to make a putty line?
[00:06:10] Aaron Muderick: Sure. Well, one was, I was very familiar with using computers and the internet and everything that was in the internet, which was much, much smaller, orders of magnitude smaller, but oh, the U.S. Patent library is available online. So I can read through that. Yeah. And then I realized I'm reading Greek. I don't understand any of it.
[00:06:30] But, you know, slowly but surely trying to figure out the language of patents and what's in them and what's not in them. And also sort of the misdirections that are in them because people publish patents to tell you how to do something. But they also aren't looking to help their competitor gain an edge.
[00:06:44] It really, it was obsessive passion that I wanted to do this. It just seemed like something that I wanted to accomplish. And I wasn't going to stop until I had learned all the things necessary to make it happen.
[00:06:56] Azhelle Wade: So wait, what was the first moment? So you're at your desk, you're buying these, the egg putty, you're playing with it. You, I guess, for some reason wanted to experiment, make your own. What was the first point when somebody else saw it and said, Oh, I'd pay you for that. We're going to get some.
[00:07:11] Aaron Muderick: So it was very soon after I had probably put seven or eight little eggs together to make a nice handful that I noticed the piece was getting smaller day by day. And I could not figure out why it was getting smaller. Was it evaporating? Was some of it melting off the side of the desk? But you know, my piece that I had made to the size of my hand was no longer to the size of my hand.
[00:07:35] And it turned out it was my coworkers all stealing a little piece for themselves when I wasn't looking.
[00:07:40] Azhelle Wade: That is so funny. So why didn't they just go buy their own egg at this toy store?
[00:07:45] Aaron Muderick: It's free if you take it from me.
[00:07:48] Azhelle Wade: No, I'm genuinely curious. So I want to like, bring me back to this entrepreneurial moment. Cause I'm the type of person where every five seconds I do something and I'm like, this is a business idea.
[00:07:57] So I want to know what was the moment where you were like, this is a business idea. And then what were the steps you did
[00:08:02] Aaron Muderick: Right. I was collecting putty to, you know, make a chunk that I could play with. Then I noticed it's getting smaller. It says there's a little light bulb. That's like other people like this too, right? I'm not a total freak. Other people like this and other people weren't willing to like, they didn't want it, they didn't have in their mind.
[00:08:18] I want to go out and get some putty and play with it at work. But when they saw someone else doing it, they were like, "Oh, maybe" and then they take a piece themselves and then they're hooked and that just triggered in me that like it wasn't just me. Other people like this too. And so then I started thinking about how I could get more grand.
[00:08:35] How do I get more? How do I make a bigger chunk? How do I make even more?
[00:08:39] Azhelle Wade: And then what'd you do? You went home and you bought some borax? What'd you do?
[00:08:43] Aaron Muderick: Every arts and crafts store and the grocery store and started buying things and mixing them in giant heavy contractor bags with my feet to try to see how they come together. I burned out a KitchenAid mixer trying make putty. And you know what? It was easy to burn it out.
[00:08:58] It was harder to realize that to replace it was like $250.
[00:09:02] Azhelle Wade: Wow. So then, so tell me about the first day you walked into work with your basket full of putty.
[00:09:09] Aaron Muderick: So actually the big reveal wasn't putty that I had made myself. But during this process, I had taken up an office pool and it was a pool for everyone to kick in money. And I was going to buy 100 lbs from Silly Putty.
[00:09:23] Azhelle Wade: Oh, you were like, Oh. You're like a reseller. you're like a distributor.
[00:09:28] Aaron Muderick: Well, I was working parallel paths here, right? I just wanted more putty. I mean, this wasn't a business. I wasn't thinking of quitting my job. I just wanted more putty. People were asking for putty. It was fun to do this pool. People thought it was crazy. So I did it. And I came in with a hundred pounds, you know, I had found a phone number and dialed until finally someone agreed.
[00:09:47] Yes. If you send a check and you wait 21 days for the check to clear, then we will send you the hundred pounds. And also don't call again. Thank you.
[00:09:55] Azhelle Wade: Oh my God.
[00:09:57] Aaron Muderick: And the hundred pounds came and it transformed that office culture. I mean, not only did everyone who was in the pool, get their putty and it was dripping from monitors and people are playing with it in meetings and we're working, using it in client engagements, but then all of the people who had turned me away when I came around desk by desk.
[00:10:16] You know, "Hey, how many pounds do you want?" Right. They were like, "Get out of here. Go back to work, Aaron." Then they were coming to my desk and they were like, "do you have any more? Is there any extra, Oh, I showed some to my kids. I showed some to my wife. I need more." And so it was very organic and viral. And then I sort of put up the money for the next hundred and then the next hundred.
[00:10:35] And then at that point started to transition into, "Oh, well, what if I mix these things together and can I replicate that? Can I make it myself? Oh, Next lightbulb moment. Actually, I can make it better and different.
[00:10:47] Azhelle Wade: Let's talk about that. Let's talk about that.
[00:10:50] Aaron Muderick: Everything around us is designed. I mean, literally, you look at the frame behind me.
[00:10:54] Everything here was thoughtfully designed by another--
[00:10:58] Azhelle Wade: Someone took time. They were in solid works or some planned tool. They were planning out those beams and that arc. Yeah.
[00:11:05] Aaron Muderick: So everything that you see was a series of choices. And so that original putty in an egg was a series of choices primarily designed around making it cost as little as possible.
[00:11:18] And there were historical reasons. The materials used to cost significantly more. So really, it was sort of a driving force to make a product that people could afford, but then also 50 years, 60 years of, well, could we make it a little cheaper?
[00:11:32] Could we make an extra penny? What could we shave? What could we save? And in doing so, making a product that wasn't nearly as visually or tactilely engaging as it could be. And if I was just doing this for fun and to, sell to my friends and family and coworkers. Well, I could put a little more into it and realizing I could make some different choices and make it more beautiful and more incredible.
[00:11:55] Azhelle Wade: When you got to retail, was it the innovation of your putty that caught the retailer's eye first, or the name that you'd built for yourself through all the work you'd done before you went to retailers?
[00:12:09] Aaron Muderick: know exactly what it was, but I do know that although I had success on a website selling putty for $10, $15 for a can instead of $1 for an egg. Convincing the retailers was definitely a bit of an uphill battle, right? Why is this product that is a $1 product suddenly you know, different sizes for $10, $15. They just didn't see it because their minds work differently in terms of merchandising, shelf space,
[00:12:43] Azhelle Wade: Footprint square, like right dollar per square foot. They're like, I don't know this egg took up this much space. You're can't taking up this much. I don't know, sir.
[00:12:52] Aaron Muderick: What made it work was a number of I would say first mover specialty toy stores who brought the product in because they are a little more try a hunch. I'll put in $250 wholesale order and I'll see what happens, right? They're a little more experimental. They're less data driven because they don't have access to giant quantities of data.
[00:13:11] They don't have teams of analysts. So they sort of shoot from the hip a little more. And in doing that they brought it into their stores and by gosh it actually, it's sold. It's sold well. And then they were back and then they were telling other people on the internet mailing lists for specialty toy stores, "Hey, this is actually working."
[00:13:28] And then the sales reps get involved and they're like, "Oh, I'm selling something that actually sells." And, you know, then you have a snowball rolling down.
[00:13:34] Azhelle Wade: Did you have demo samples in the store when they sold through like that.
[00:13:40] Aaron Muderick: One of my really strong beliefs is if a store asks you for demos, you give them demos, right? Like they're telling you that they're going to invest their time and their staff in showing off in their space and showing off your product. So we've always had a very liberal demo sample policy. And I think that has paid off.
[00:13:58] Azhelle Wade: Yeah. I was going to say, how did everyone thinks it's all about getting your product into the store, but if your product doesn't sell once it gets into the store, it's not going to get back in.
[00:14:06] Aaron Muderick: No. And going to then the retailer just comes to you and says, they want their money back. So you actually are upside down because from the retailer's perspective, the product costs zero because ultimately they can get their money back, you know, a large retailer.
[00:14:18] Azhelle Wade: And that's called a charge back for those listening. Yeah.
[00:14:21] Aaron Muderick: A charge back. And, but unfortunately for you, the product didn't cost you zero. So now you are upside down and that is not a place you ever want to be.
[00:14:30] Azhelle Wade: Yes. Yes. Yes. Was there anything that you did to ensure you would sell through or you were like, we just had really good product. I didn't have to do anything. It just sold through.
[00:14:38] Aaron Muderick: I mean, what we did was not sell into mass merchandisers for probably eight years. I think we entered target in 2017 or 2018.
[00:14:47] Azhelle Wade: Okay.
[00:14:48] Aaron Muderick: That was our first mass retailer.
[00:14:50] Azhelle Wade: Last follow up question then on this topic, and then we'll move on to our next topic. I encourage my students to not rush to match market for the same reason, but how did you make sure you were going to run a profitable business that was big enough to support, you know, your life, your livelihood?
[00:15:07] Based mostly on specialty and online sales. Is there a lot of profit margin awareness? Is it just working with a really slim team? Is it because, oh, the thing that we've talked about before, how you have very narrow footprints that you're working with. You're not trying to do a ton of different things.
[00:15:22] Like I feel like there's some creators out there that struggle to make it profitable with those specialty retailers. And I think it's because they're doing too much, but I would love to hear your thoughts.
[00:15:32] Aaron Muderick: Part of that success at specialty was the compactness of our product and how, you know, we went from sort of being pegged if they had pegs or sitting on a shelf to building a store display that gave it a home that encouraged refilling, you know, you would be surprised at how many. specialty stores.
[00:15:51] When a shelf runs empty on goods, they just slide the goods on the left and the right together to fill the hole and they don't necessarily place a reorder. Now, a savvy specialty store owner doesn't do that. But when you're dealing with thousands of accounts like you need a home for your brand, right? So that investment in that display, which ultimately the manufacturer is paying for, that's what you're getting.
[00:16:11] But I think for us, it was the compactness of sort of dollars per square foot, which was very attractive for them. I think for someone else, it could be 100 different variables. But if you have 100, how can you find the three most important? You do need to focus. You need to focus down on what's key for you.
[00:16:29] Azhelle Wade: I like that. Oh, actually this is a good, I've done this exercise before. Someone had me create like a chart where at the left, so imagine like a table on Excel and the left column says all your products. And then the top was something like a rating system from one to five being like how much you enjoy it or how much you don't.
[00:16:48] I think that's what it was. And then I think there's another rating system for how much money it brings you and how much it doesn't. And you kind of go through that with all the products. And at the end you find, okay, this thing, which for me, it's like Toy Creators Academy, generates the most money in my business and also is the thing I enjoy the most.
[00:17:04] So I wonder if that's also an exercise people need to do to see maybe I'm just doing too much if all these Other products are causing more complex logistics and they're not turning the revenue, maybe that's not where I need to focus. Otherwise, my business is not gonna survive
[00:17:17] Aaron Muderick: If you looked at crazy Aaron's five years ago, we were a one product company, right? We had 100 SKUs, but it's one product. It's thinking putty and some of this is just luck, right? I had an idea. I had a thing that I love.
[00:17:28] It also turned out other people loved it too, right? That the thing that you love isn't always the thing that millions of people also love. But given that was true, we were able to focus on doing one thing and doing it really well. We did it in red, green, blue, magnetic color changing, et cetera, et cetera.
[00:17:44] But we were doing one thing and I do see a lot of toy companies who are spread too thin, especially when they are too small, but also too large where people are chasing revenue.
[00:17:54] Azhelle Wade: And they think the way they're going to do that is adding more pages to the catalog. And if all of your products are mediocre, then all of your sales are going to be mediocre.
[00:18:05] Aaron Muderick: Now you might be able to grow that into a bigger number, but is it going to propel you as a brand? Is it going to give you momentum? Is it buying you credibility? I'd say that's an open question. The other thing that just I don't know that this can happen for everyone, but was true for us was we controlled our own manufacturing, right?
[00:18:21] Everything that we make is made here in Philadelphia, and it's formulas that I've come up with and machines that I have worked to build and a factory that we do it in. That's not going to happen. And most people who are getting into the toy business don't want to have a toy factory, nor could they domestically have a cost effective factory when they're competing with Asian production. But I do see that a lot of people, they go to the fairs, they go to Canton fair. They go over there and they look around and they're given these giant catalogs of products. And so they're like, sure, I'll make some packaging and I'll buy all this.
[00:18:52] Instead of focusing on how can I see this one product that I was shown and how do I give input to that manufacturer to really twist it a little to make it great, take it from mediocre to great, or how do I take my idea, which is great.
[00:19:05] And then when I show it to a factory, who's going to build it. It kind of comes back mediocre. Do I need to push a little harder to make it wonderful? Because I only have one shot to impress people.
[00:19:16] Azhelle Wade: No, it's so great. Yes. Yes. Yes. Yes. Taking us to church on the podcast. So we know the toy industry, there's been a growing conversation around sustainability. You mentioned that your products are made locally in Philadelphia. Was that because of a desire to be a sustainable company or to maintain control over the product development production process?
[00:19:39] Aaron Muderick: Well, it was primarily a desire not to spend most of my life in an aluminum tube.
[00:19:42] Azhelle Wade: Wait, what? Oh, in an airplane. Okay. Ha. Okay.
[00:19:46] Aaron Muderick: That was number one. I had small children. I didn't want to be away.
[00:19:50] Azhelle Wade: Aw.
[00:19:51] Aaron Muderick: And then second was realizing if you have a secret formula. And you give it to a factory 9000 miles away, it doesn't stay secret for very long. And I don't care how many NDAs you have or how many years you have a relationship with someone.
[00:20:05] They have workers to like people go around. They talk and it's only secret as long as it's secret, right? Patents. You have a little more protection, but you have to finance the enforcement and you don't have any money to begin with. So you're already upside down after spending 10 to 15000 dollars working to get a patent.
[00:20:22] Where are you going to find the $150, 000 to enforce it? When someone knocks you off?
[00:20:26] Azhelle Wade: Oh, okay. But all right. I got it. I got it. I'm sorry. We're not leaving this section because you keep bringing up new questions. So I launched a costume company years ago and I stayed in the, made in the US for the same reason. Cause I was like, my patterns are genius and they're going to steal it because why wouldn't they?
[00:20:43] I would know, but like, why wouldn't they? So I, I found seamstresses locally and I work with them locally and produce the product, but my product was really expensive and I, foolishly, looking back now, I think I tried to make too much margin, I tried to make the standard keystone margin knowing that my costs were higher because I was doing small quantities in the US.
[00:21:04] And I, now I look back and I'm like, I probably should have, I could have gotten away with doing 25%. And I probably would have sold a lot more and stayed in business a bit longer, more successfully. How did you manage the cost of producing in the U S did you take a smaller margin when you first started and then were able to give yourself more as you increase production?
[00:21:24] Aaron Muderick: There were economies of scale as you grow so that you can increase your margin, right? You get a bigger piece of equipment, you become more automated. You are buying bigger and getting better pricing. So all of those things can work in your favor, I guess the other piece of growing the business was I didn't just have that episode where I sold everyone 100lbs of putty and then I quit my job and started making putty. I did it for four more years working my putty job at nights and weekends until it got to the point where, you know, I was dying.
[00:21:56] Right. We had a Christmas where I just couldn't, do it anymore. And then it was like, okay, maybe this is the moment to quit. And I remember looking at us, putting together a spreadsheet, calling my accountant, like vetting that, you know, cause I didn't know anything about finance or bookkeeping, trying to understand like what I was doing, even at the small scale that I was doing it and saying to myself, well, I can pay the rent and I can eat ramen.
[00:22:22] I think I'll be okay. I'm going to try this.
[00:22:23] Azhelle Wade: Did you hire help while you were working full time?
[00:22:27] Aaron Muderick: No, because the other piece of advice my accountant gave me was avoid having employees for as long as possible, right? The Internet. This is a long time ago. The Internet wasn't nearly where it is now. The gig economy wasn't nearly where it is now. So and we're making a physical product and we're doing it here.
[00:22:41] So we're not. It's not like I would have a graphic designer. You know, on call or like of my factory in China. I don't have those things, right? I'm literally making the putty, breaking it up, putting it in the can, putting the labels on, you know, putting a sticker on it and getting it out the door.
[00:22:58] Azhelle Wade: How many hours were you working?
[00:23:00] Aaron Muderick: All of the hours
[00:23:02] Azhelle Wade: For four years?
[00:23:04] Aaron Muderick: It didn't start being slammed like that, but it progressed over time. And obviously the holidays were absolutely bonkers. But at that point, and then getting that advice not to hire direct employees, I started working with social services and that's how we became involved with the intellectual and physically disabled community. And working with social services centers that helped individuals like that, find work, have work, develop their skills.
[00:23:27] And so, until we opened our factory, you know, our own ground in 2010, we spent probably 8 or 9 years co located in a social services agency. Buying equipment, showing them how to use it, making special accommodations because the employees there had special needs, either like special needs, like maybe not strong enough, you know, physically to turn a dial, but also impulsiveness that they might reach into a machine and try to bypass a guard and get themselves hurt.
[00:23:56] So we had to do all kinds of things to sort of upgrade standard equipment, which would be considered safe by OSHA standards to make them sort of extra special safe, almost if they were being used by younger children.
[00:24:06] Azhelle Wade: What kept you driven to to solve all of these problems and to keep doing all of this? Why were you building this?
[00:24:12] Aaron Muderick: I mean, I got letters from people who love the product that made them happy. I got all kinds of inspirational, you know, feedback from my consumers that drives me personally. It felt like now we were closing the loop, making a product that made people happy, maybe building it in a way that was doing social good.
[00:24:30] It just seemed like a full circle. It seemed like a smart thing to keep doing.
[00:24:33] Azhelle Wade: Yeah. I agree. Consumers, if you love a product, send us an email, a letter. If you're listening to this podcast and you like it, tell me because we need motivation. It gets hard out here, you know? So all right, let's move on. I'd love to talk a little bit about the trends outliving the slime craze of 2018.
[00:24:49] I would say after 2018, slime was dead, yet Crazy Aaron's is the compound that will live forever. How did you navigate the surge in slime popularity? Did it help? Did it lift your business? Did you feel afraid for the competition or were you just I'm beyond this, like, how'd you do it?
[00:25:07] Aaron Muderick: If I was in a different place in my life, I probably would have leaned into slime sooner, right? We make putty and putty is not slime, right? And it's its own thing.
[00:25:16] But given the sort of that consumers don't see those differences quite as strongly. It would have made sense for Crazy Aaron's to move into slime and try to be dominant in slime and sort of try to steer where slime was going.
[00:25:29] Right? But slime did its thing on its own. It definitely helped us. But when it was dead, it didn't hurt us because we weren't slime. And also we were growing and growing in the sense of there are always more retailers and customers. You know, if you are a Hasbro or a Mattel or a Spin Master, you are saturated.
[00:25:47] Your salespeople are calling on every place that could possibly sell your product. So the way you grow your sales is to grow consumer demand, to pull it off the shelf at a higher velocity, or to have a new product that has a high velocity that sort of replaces something older that wasn't as high velocity.
[00:26:03] But for a smaller company, for someone who's starting out. Well, you can double the number of stores you're in. You can get another mass retailer. There aren't that many of them, but if you have zero, you can bring it to one. And if you have one, you can bring it to two. And that is going to drive your business.
[00:26:16] Even when sort of that like viral momentum falls away.
[00:26:21] And that's what we did. And you know, we didn't have any problem with it. What we did see was a lot fewer people making copycats of our product,
[00:26:31] Azhelle Wade: Oh, interesting.
[00:26:32] Aaron Muderick: There's always people who chase the trends, they're reading data reports and they're like, this is what's selling.
[00:26:37] So we're going to copy that. But the second, all that slime stopped selling, they move on to copy the next thing. They don't have an investment in a factory. They don't have employees making a specific kind of product. They just go to Canton fair and they get something else and try to sell.
[00:26:51] Azhelle Wade: I'm surprised you didn't have like customers that maybe the first retailers that bet on you that your product was selling so well when the slime trend was happening. They're like, dude, can you just put some slime in this can? Like it will sell. Please just
[00:27:03] Aaron Muderick: That's exactly what they said. I just didn't do it.
[00:27:05] Azhelle Wade: You just didn't do it? You, oh
[00:27:08] Aaron Muderick: I like the putty. I liked what I liked and I also had my hands full growing and building this company. It wasn't like it was sort of stagnant. And I was like, I don't care. I just don't want to do anything. We were growing really fast and trying to professionalize internally, build a real company, not just a startup. And you can only take on so many challenges at once, thatt was a strategic decision.
[00:27:30] Azhelle Wade: So, if you had plateaued, if your putty had plateaued, do you think you would have said, all right, fine, I'll make a slime SKU.
[00:27:37] Aaron Muderick: I think I would have said, how do I work harder to communicate how great putty is.
[00:27:41] Azhelle Wade: Wow, damn, focus. Okay. All right, focus.
[00:27:45] Aaron Muderick: But ultimately I started as I got more involved in the toy business and had a bigger, better picture of it as a business started to see, okay, like what are the other kinds of products that Crazy Aaron's can make that we can do well, that makes sense to a consumer, but also makes sense for us on the business side.
[00:28:02] And we tried some different things and Ultimately, you know, here we are today.
[00:28:06] Azhelle Wade: Yeah, did you ever convert anyone who was like a slime lover to a putty lover? Do you ever get any letters like that?
[00:28:11] Aaron Muderick: Oh yeah. All the time.
[00:28:12] Azhelle Wade: No way.
[00:28:14] Aaron Muderick: Well, one thing that slime did is it increased the number of complaints we got that it's all dried out, right? Because they are expecting this watery, goopy slime and putty has a much, much more body and a thicker consistency to it. And so it didn't sort of jive, but we always took those things as opportunities.
[00:28:33] Anytime a customer reaches out to you with a complaint, now you actually have their attention, which is like the hardest thing to get. So how can you turn them into a convert? And we, I think we had a great success.
[00:28:42] Azhelle Wade: That's so cool. Love it. Okay. Love it. So building a strong customer base usually, like you said, helps brands, whether ups and downs of trends like slime lifting other compounds like putty and also dough. We'll get into that too. How do you foster your loyalty among fans of Crazy Aaron's?
[00:29:02] Do you have a community of some sort?
[00:29:04] Aaron Muderick: think we do have a community, but we don't have a website
[00:29:08] Azhelle Wade: Like a meeting? Yeah. Like a meeting
[00:29:09] Aaron Muderick: right? We don't have a meeting place. I think the way you do it is you are really authentic and honest and really care about your product. And I think if that can come through in the design of the product, it can come through in what your company is doing.
[00:29:23] Like the specialty buyers. They felt and understood what I was trying to do in terms of that complete loop of a product that makes people happy, helps people, is also made by people who need help, like it closes the whole circle, right? So they're telling our story, they're telling our story to consumers.
[00:29:40] Now, if the product wasn't good, nobody cares how good the story is. And I've seen a lot of brands that try to lean on some kind of social aspects. To sell their product. It's a nice to have every time. I wish it wasn't a nice to have that. We could all do good in the world and everyone would reward us for it.
[00:29:57] But you have to have a product that actually delivers the value the customers asking for. And I think we did that making a product that was the highest quality on the market consistently. All of the copycats always fell short. They were too sticky. They were too gooey.
[00:30:12] They actually did dry out. Our putty never dries out ever.
[00:30:16] Azhelle Wade: Really? I'm going to go open up one of my old cans.
[00:30:18] Aaron Muderick: Never dries out. So, you know, all of those things, just being true and honest to that and just our marketing and our brand image all based around
[00:30:27] Azhelle Wade: Yeah.
[00:30:28] Aaron Muderick: It works.
[00:30:29] Azhelle Wade: What's really interesting is you said consistency. There's always inconsistencies when you're working with a factory overseas. It just happens. But the fact that you have a factory local to you, you can maintain that consistency more and you can monitor it more closely.
[00:30:44] And I just hadn't really thought about that as such a big, massive competitive edge you have.
[00:30:49] Aaron Muderick: I mean, it's easier because it's right here on the other side of this
[00:30:52] Azhelle Wade: Not easier to build though.
[00:30:54] Aaron Muderick: But it's not easier. It's not easier to build. It's not easier to maintain every day. It's a battle, it's a struggle, right? You are working like the entropy increases.
[00:31:03] That's the rule of the universe. Everything falls apart. So every day, all of our efforts are put into keeping that quality and consistency and not letting it go.
[00:31:12] Azhelle Wade: Yeah, but I think that focus, it's just man, you're making me rethink some business decisions I've made recently. Like that focus on your core competency allows you to keep perfecting it and not have to worry about all the extra side things. If you had just a factory in China and you were like, we're going to go after all the compounds.
[00:31:33] And there was some inconsistency with a putty. You might think, Oh, maybe people just aren't into putty right now. You wouldn't be working to tweak and perfect that. I don't know.
[00:31:42] Aaron Muderick: Because how much sampling are you doing of the product that you're bringing over? What's the percentage of them that you're opening that you're doing quality inspections on, right? We have a line and it does, you know, a very high rate of putty coming off. There's someone walking over to that line every 7 minutes
[00:31:57] and taking samples, you And checking them for quality,
[00:32:01] Azhelle Wade: Wow!
[00:32:02] Aaron Muderick: Because it drifts, you know, labels go sideways.
[00:32:05] Azhelle Wade: Quality assurance!
[00:32:07] Aaron Muderick: Or perforation on the heat seal goes bad. The weights are wrong. There's the putty is the wrong color. There's some contaminant dust got in there, dirt, whatever. So it needs to be sampled and check. And, you're not going to be able to get your factory to just do that because you ask for it. They're not going to, they're going to tell you " Yeah. Of course we do all that."
[00:32:25] Azhelle Wade: Yeah.
[00:32:26] Aaron Muderick: And you're not making medical products, which sort of have legal requirements to that extent. But anyway, so, if someone wanted to make a product and it was fairly, you know, a complex thing that was special to them, get on a plane and get an apartment and go over there and stay there, be there for the production.
[00:32:43] Don't go to see the final product. Don't go to just do a quick inspection or to have them air freight you samples for you to check, go and be there and you might have to be there for some time, but that's an investment in your future that it will be done correctly because you know, how many people are starting off and they get that delivery and the whole container is wrong
[00:33:08] Azhelle Wade: Oh my gosh, I've had where someone there was like a leak in the box or something, so half of the doll's hair was wet and like moldy.
[00:33:16] Aaron Muderick: And then where are you? You don't, you barely had money to order that container. What do you do now? So, you know, the insurance policy of going to live there for a month.
[00:33:26] Azhelle Wade: I had a student who had blood on their doll. It was, like, there's just a lot.
[00:33:31] Aaron Muderick: Yeah,
[00:33:32] Azhelle Wade: Yeah. You know, I hadn't thought about that for new creators, because when you work for a company, well, you work for a big company full time, they send you there, but they also have QC team that is there the whole time.
[00:33:42] But yeah, you're right. The only other way to manage that, unless you're hiring a Kima, but they're not going to give it the care you're going to give
[00:33:49] Aaron Muderick: They don't know all the things in your head. You don't even know to write down in documentation. They will do what you document very well, but you don't, but something will go sideways and you won't find out about it. And here is, you know, as we were building our factory, 1, 000 things went wrong. 1, 000 things I could never even predicted.
[00:34:06] Things I didn't even know were things that could fail. But because it was right here, we were able to catch it right away and fix it.
[00:34:12] Azhelle Wade: Oh, and because it's right here, all of these changes that happen with container costs don't even affect you the way that everyone else is freaking out, right?
[00:34:21] Aaron Muderick: Well, the container costs did not have a major impact on us. But what did have an impact is this port strike that's happening
[00:34:29] Azhelle Wade: Oh, right. You still have to ship.
[00:34:30] Aaron Muderick: Because all of our exports to all of the other countries in the world that want their thinking putty, that is all currently sitting in containers in my parking lot, and I can't get any trucks them up because there's no ships to put them on.
[00:34:42] Azhelle Wade: Okay. But you still are good in the U. S. I'm just saying. That's that's something that most people don't have.
[00:34:46] Aaron Muderick: We're a diversified company, people want putty all around the world slime and dough.
[00:34:50] Azhelle Wade: Well, I guess you might have to build some more local factories in other countries is what I'm hearing.
[00:34:55] Aaron Muderick: Sounds like more time in an aluminum tube.
[00:34:57] Azhelle Wade: No, maybe you get, I don't know. Yeah true. Alright, so I want to talk about the future of compounds. Do you have any predictions for the next big thing in the compound side of the toy industry? Or maybe the sensory side of the toy space?
[00:35:11] Aaron Muderick: Well, if I did, I might not be able to share them
[00:35:14] Azhelle Wade: I was just trying, you know.
[00:35:16] Aaron Muderick: I but, I definitely, I've seen over 26 years, sensory was not a word, fidget was not a word. Idle play was not a thing. That is play where you're using the product while doing something else. You're watching a movie while playing with your thinking putty.
[00:35:32] Watching a movie while squish, you know, pressing your fidget cue. But they are here and they're not going away. I see a lot of derivative product and I see a lot of viral product where it's something that already existed, but now it's being co opted into sensory and fidget and squish. It's not going anywhere.
[00:35:50] I think customers crave novelty. You know, we're in a business of what have you done for me lately? Right? Even our thinking putties, you know, SKUs that I made, which successfully sold, you know, and we're top sellers for 10 or 15 years. Eventually they sunset and it's time for something new, even if it's just a change of color or artwork or whatever.
[00:36:10] So I think that there's definitely room in the space and there's opportunity for people who just noticed their child sort of obsessing over something really simple, two pieces of cardboard and the way it's folded together be able to turn that into a business.
[00:36:24] Azhelle Wade: Okay. Is there another word? I hadn't heard 'idle play'. I heard something else that is relevant for games, but I can't remember the term now. It's like where you play a game while playing other games. It's like there's a game that goes on. That you play throughout like a party, that is like game
[00:36:40] Aaron Muderick: Metagaming. I don't.
[00:36:41] Azhelle Wade: No, it's Werewolf. If you were to play Werewolf, but you weren't all sitting at a table, and it was like a game you were playing while a party was going on, there's a name for that, that is escaping but Idle Play is similar, but for toys. Is there any other phrase that you heard that's been popular lately? Can I get that out of you?
[00:36:57] Aaron Muderick: I would say calling the category manipulatives. And then sort of seeing that category, I guess we were saying kidults, but now we're talking more 18 plus, right? Which is sort of takes me back to where I started, which was, of course, 18 plus, we're all stressed out of our minds.
[00:37:13] We sure could use something to fidget with to help us focus or quit smoking or stop picking our hair or scratching.
[00:37:18] Azhelle Wade: Oh. Habit forming putty. Okay. Oh, cool. All right. The last thing I want to talk about today is inventors, because we're talking a little bit about innovation in the future of compounds. If there are inventors out there that have ideas for putty and also we didn't talk about land of dough. Oh my gosh. We might have to back up and talk about that. Do you work with inventors?
[00:37:44] Aaron Muderick: I do work with inventors. Look, I am always out there looking for the thing I didn't know I need. And people say, "Well, what are you looking for?" I don't know if I knew what that next great invention was, we would be doing it and we have worked with inventors in the past. You've come to us with some tremendously cool ideas that I never would have thought of that.
[00:38:04] We bring them in. They get to be part of the creative process and ultimately get a product, you know, on the shelves of it's not only specialty toy stores, but mass merchandisers, just like working with any toy company. What we do really well at Crazy Aaron's is make compounds, right? We basically have a chemistry factory here to make all of these things and we're able to package it.
[00:38:25] And ship it out. And so one is innovative chemistries and compounds. Now, that's maybe a more rarefied group of people who are coming up with those chemistries. And sometimes they're amateur in the sense they came up with something. And then we come in and use our expertise to sort of run the toxicology, make sure it's all safe, make sure it doesn't grow mold.
[00:38:46] Kind of we can do the finishing on that chemistry to make something unique and interesting on the other side is what can you do inside the packaging? Because we're not made overseas, it's much harder for us to sort of make new packaging shapes and sizes. And we're not doing a lot of hand kidding.
[00:39:05] There's some automation. That is what allows American labor to do this cost effectively and because of that, we really excel if the idea is sort of can fit inside the tin, which I also love from a sustainability perspective. We're not using lots of back form plastic and we can just make a paper box with a metal tin that is recyclable with the putty that has a good environmental profile.
[00:39:28] And then the stuff goes in it when that's the same for the dough and the paper cups and the slime, et cetera.
[00:39:33] Azhelle Wade: So, when it comes to compound innovations, what are some key characteristics that you're looking for? Something that's surprising? Something that's, I don't know, manipulative? Are there key traits that would make a good invention that would perk your ears up?
[00:39:50] Aaron Muderick: I guess I would say it's classic play with a twist. Okay. Right. So what do I mean? All of the sort of play patterns that exist, they exist. You could document them. What makes novelty and what drives the toy industry is that twist, that newness, that, "Oh, I hadn't thought of it that way." Now, sometimes you see that as licensing, right?
[00:40:11] I'm going to take the same play pattern, but I'm going to put Disney Princesses on it and that's going to drive sales. But other times, it's sort of the you know, the inventiveness of it. I mean, look at a game like Jenga, right? I mean, it gets referenced so many times in our industry. It is so simple.
[00:40:25] It is so straightforward. You can imagine a bunch of kids out in the woods building something out of sticks and then pulling them away and playing a game. It's like a street game.
[00:40:36] And that's why it's so appealing. But then they made gender and it's the same game with a twist, right?
[00:40:40] It's more formalized in the shape and structure and the rules. So something like that. Anything that sort of can use the compound with another thing, but not sort of a whole activity set more something that can fit inside with it. That gives it something different, something unexpected, Wow, wonder, amazement and especially these days, something that films really well because kids, even if they're not posting on social media, they're making hundreds and hundreds of private videos of them talking to their phones and showing sort of an imaginary viewer what they're doing.
[00:41:11] That form of play goes really well with those kinds of products.
[00:41:14] Azhelle Wade: And one example of that would be your fortune telling putty because that has it's an inventor item, and it has yes and no beads in it, so you can ask your fortune, play with the putty, and then stretch to reveal. I remember when you showed me, that was so cool. That might have been when we first met, actually.
[00:41:32] So that is an innovation that fits into a tin. And that's what you're looking for if someone's going to innovate the compounds you already have.
[00:41:40] Aaron Muderick: And it's also an idea that can be reskinned 100 different ways to stay fresh and follow trends. So you can do a version that's like fortune teller, but you can also do a version that's executive decision maker. And you can do, you can make 100 different kinds of that. Idea so that you can constantly be trying things, try things for different channels.
[00:42:02] They might be more successful in certain channels than others. A good idea has sort of, the skin is not the idea, it's the underlying gameplay. And then it can be skin to sort of match the zeitgeist of the now.
[00:42:13] Azhelle Wade: That's one of the toyetic principles I came up with when I first started this podcast. It's called scalability by theme. If your idea is toyetic, it's scalable by theme.
[00:42:21] Aaron Muderick: I like it.
[00:42:23] Azhelle Wade: Nice. So, okay. We have two closing questions for you. One was actually given by our last guest on the podcast, Marina, the founder of Hugimals. She didn't know who this question was going to go to.
[00:42:34] Aaron Muderick: She sends it forward.
[00:42:35] Azhelle Wade: She sent it forward. So you're going to send one too. I forgot to tell you that. Sorry. But so Marina, spoiler, Marina sent someone and it's going to be you this question. What is one mistake that you made in your business along the way?
[00:42:50] Aaron Muderick: It was as I started to hire employees, keeping employees who were not passionate about the vision, and we're not great performers, but we're good. We're okay. We're fine and not realizing the huge gulf between sort of okay and great. And that as a business we were able to go out there and get great.
[00:43:13] We were worth it. And if I had done that sooner, I think I would have a slightly fewer gray hairs. I'm looking at myself in the camera here. And also you know, success begets success and successful people like to work with other really strong people. And so building that really strong team and being honest about sort of poor and mediocre performers would have propelled this organization to excellence sooner.
[00:43:39] Azhelle Wade: Oh yeah. I could say while you were speaking this whole interview, I was like, man, I wish I knew about this company when I was starting out. Cause I would have, I still would, but I would have loved to work with you full time. Like I would have just. You're so passionate about what you're doing. You want to make good product and you're focused. You're not stretching people thousand different directions, but like that, no, it's, I definitely
[00:44:01] Aaron Muderick: Sometimes I'm, but then we
[00:44:02] Azhelle Wade: Well, well, I mean,
[00:44:03] Aaron Muderick: I'm open to feedback too, which is you're stretching us too thin. Okay. What do we cut?
[00:44:08] Azhelle Wade: Well, everyone works hard, but there is a huge difference and I've done this before in working hard on, let's say I do doll houses versus I do doll houses and plush and play things and wooden toys. So like having the focus of just. Like land of dough putty and slime even would be. Is not typical of a toy company is what I'll say.
[00:44:29] Aaron Muderick: Can I add to that? Are you making a toy or are you a sales rep for a factory? I don't mean that in a bad, no, I don't mean that to insult. You can be either, but choose which one you're doing.
[00:44:44] Azhelle Wade: That's so true. A sales rep for a factory. Damn.
[00:44:50] Aaron Muderick: And the reason I say it is because as the Internet makes this world even smaller and continues to disintermediate, those factories are not going to need you as their sales rep, and they're going to become your competitor, your competition.
[00:45:04] Azhelle Wade: Oh, I already see it.
[00:45:05] Aaron Muderick: But if you are bringing innovation and design, then you will survive and thrive in that era because your products will stand apart and you'll survive and thrive with buyers because your products will stand apart.
[00:45:16] Azhelle Wade: Yeah. And it's going to be your brand. Oh, so good. All right. My final question for you today, Aaron is what toy or game blew your mind as a kid?
[00:45:26] Aaron Muderick: Oh, gosh. I would say it was Dark Tower,
[00:45:30] Azhelle Wade: What's Dark Tower?
[00:45:32] Aaron Muderick: The board game, right? Did I have the name right? I'm gonna check. I'm pretty sure I do. It was a Hasbro game.
[00:45:39] Azhelle Wade: Oh, it's a movie apparently.
[00:45:41] Aaron Muderick: Yeah, and it came with the tower.
[00:45:45] Azhelle Wade: Ooh, oh, I've never seen this
[00:45:47] Aaron Muderick: I just love this game. It has sort of a D& D vibes. And look, there's a Return to Dark Tower Kickstarter special.
[00:45:55] Azhelle Wade: It is not on Etsy for 571.
[00:45:59] Aaron Muderick: Apparently it is. Well, I got one at a garage sale for a dollar in 1980 whatever. And I loved it.
[00:46:05] Azhelle Wade: What do you like about this game? What's the energy of it?
[00:46:08] Aaron Muderick: There's a computer in there that like you sort of spin and it randomizes what happens. And it just completely brought me in like that. I was really in this fantasy world and oh my gosh, a ghost just dumped out and oh, I found a sword and it just, but it wasn't on the computer. So it seemed very physical and very real.
[00:46:25] It would have, it would sort of have a inside is a column with different panels and it would spin when you would press the button and then 1 of them would light up and there would be a sound effect. That would match which panel lit up. So it was a very cheap way of now you just have it show on the screen, whatever you want it to do.
[00:46:43] But obviously it wasn't the screen. They were sort of backlit slides. And I love that game.
[00:46:48] Azhelle Wade: That's so cool. Thanks for sharing.
[00:46:51] Aaron Muderick: One thing I used to do was sort of it take games apart or toys and build them into larger Rube Goldberg and you know, things. So how do I connect like my little toy train that when it gets to the end, it'll bump on the dark tower and ghost and then it'll make a thing fall.
[00:47:05] Azhelle Wade: Yeah, Oh that's so cool. Thanks for sharing. I love that. Aaron, thank you so much for joining us today and sharing your journey from tech professional to toy industry, innovator and entrepreneur, and for sharing your thoughts on how to have a successful toy business and make your local factory, everything that you shared today.
[00:47:22] I know our listeners are going to take away major insights from a lot of this episode. Now, if you love this podcast and you haven't already left a review, what are you waiting for? Your reviews are what keep me coming back week after week, and it's what entices guests like Aaron to come and drop their knowledge on this podcast.
[00:47:38] So please like this episode, leave a rating and review. And as always, thank you so much for spending this time with me today. I know your time is valuable and that there are a ton of podcasts out there. So it truly means the world to us that you tune into this one until next week. We'll see you later, toy people. Bye.
-
🎓 Unlock dozens of trusted factory contacts, develop your idea, and grow your toy company contact list TODAY by joining Toy Creators Academy®, learn more here.