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Written by
Christian Vinaa - Februar 2016

"That's how I see it . . ."


Theme : "Märklino" - what and why ?




After the Spielwarenmessen - Toy fair - 2016 in Nürnberg it is time to evaluate how Märklin is doing - what is working and which dog won't hunt.


Expectations

As you have probably already read Märklin did not perform as well as expected in the previous year.

I tend to think that over-optimistic expectations are at fault.

As I see it Märklin did not do bad in 2015.

Yes - sales were a little bit down, but considering what Märklin has gone through during the last 10 years it is nothing to be alarmed about.

The important thing is that Märklin is back as a family business - which by definition means that long-term goals and long-term views matters.

"Short-term" - where a director only wants to perform well this year ( to get a bonus and another line on his CV ) and not caring about what happens next year or the year after - is o_u_t - OUT.

Stability

I think that you cannot stress this point enough.

Herr Florian Sieber is not worrying about his career - he only wants to make a good job - ALSO in the long run.

He knows that he does not have to perform well only in 2016 and then be able to move along to another company leaving Märklin in ruins.

He cannot run from his father, Herr Michael Sieber, and the Simba-Dickie group - owner of Märklin.

BTW - I've met both Herr Florian Sieber and, briefly, Herr Michael Sieber. Both impressed me with their commitment and their almost childish joy for model trains.

And there was real enthusiasm - and pride - in Florian Sieber's eyes when he introduced the BR 01.5 at the Göppingen Train Station during the Märklin Tage 2015, as you can see from these photos :

Click on an image to enlarge in a new browser window :
Flarian Sieber and BR 01.5 - Göppingen September 2015 Florian Sieber being interviewed by Hagen von Ortloff Göppingen September 2015
Florian Sieber in the BR 01.5 and being interviewed by Hagen von Ortloff.

Florian Sieber taking photo of BR 01.5 in Göppingen September 2015 ee
Right picture © NWZ and Susanne Rauh, who can be seen in my picture ( standing to the right of woman in yellow jacket. )
By coincidence I took a photo of Florian Sieber at the same moment
that the photographer from the NWZ took her picture.


Times are not changing

So stability is back with Märklin.

What Märklin has to focus on is how "times-are-changing" or rather how they are not changing.

The model railroad has always had problems with when children grew up and with how technology has changed the rules.

Children - boys - always has had other interests as they grow up. Mopeds and cars / girls and women.

Nothing - NOTHING - that Märklin does will change that. Period.


So - "my world" is not bad at all - but the results will - by large - first be seen in about 30 - 40 years.

Talking about long-term strategies !

"Start up" is basically Märklin as it was in the 1960'ties. Sturdy unbreakable model trains / toys for the boys - whether they are 11 or 60.

Lets face it - the "Märklin" products today have become so detailed and so refined that it takes a certain maturity regarding handling and caring.

The "lets-see-how-fast-the-train-can-go" aspect will not do with a fine "Märklin" locomotive which will only crash to the floor in a curve. A "Start up" locomotive OTOH can handle this - although not recommendable as a general rule.


Advertising

So what to do ?

Hang on to "my world". It is a strong product, but should be marketed better.

There are rumours that Märklin next Christmas will produce "my world" TV-commercials. Those are not cheap - but the question is whether Märklin can afford not do buy them ?

Märklin has historically had great success with these commercials. See the collection ➚ on my Youtube playlist.

The frase "Der Wunsch ist klar bei groß und klein, die Marke Märklin muss es sein" is still something that people in Germany can remember even though the commercials were from the 1960'ties.

See the newer Märklin commercials ➚ on my other Youtube playlist.


I recently visited a Karstadt ➚ - a big German department store.

They had a rather big toy department - and not only the usual LEGO and Playmobil stuff - also some other - although typical German toys. But no Märklin and no "my World".

Why not ?

Märklin should have at least a few "my world" start sets in Karstadt no matter how many they sell. The boxes MUST be out there to be seen.


Action - motion

One thing that Märklin must never forget is that trains and model trains are all about motion - action and MOTION.

So when Märklin wants to sell "my world" starter-set in the DIY-stores it is not enough just to stack a lot of "my world" boxes.

There must also be some kind of video display like the one that Märklin had in Nürnberg :
märklin nurnberg 2016

LEGO knows that. Märklin should know that too.

But sadly - The lack of motion is very evident in both "my world" and "Start up" club magazines / websites.

tim tender
Märklin's "Tim Tender"
"Start up"
Image © Märklin.
Marklino
Märklin's "Märklino"
"my world"
Image © Märklin.
"Start up" has "Tim Tender" - a comic-strip humanoid that the children in the "Start-Up Club" can read about, but ... let's be honest :

Is "Tim Tender" charismatic or interesting ?

I think that "Tim Tender" belongs in the 1970'ties.


Märklin also has the "Märklino" comic-strip figure in "my world", but again :

Is "Märklino" a catching and interesting figure like
"Lightning McQueen" or "Thomas the Tank Engine" ?

I am afraid the answer is : "No".
( But it has the potential to be )


And further proof of "Märklino" being a flop :

Try Google images for "Märklino" and see what comes up : One single image. ( January 2016 ).

If "Märklino" is to be a real marketing tool, there should be a lot more about "Märklino" to be found on the internet - but there is not.


See these 3 "Märklino" comic strips from Märklin's website 2015 / 2016 :

Click on an image to enlarge in new browser window :
märklino märklino märklino
All images © Märklin.

OK - I'll admit - "Märklino" has a certain cute-ness factor, - but :

In this age where iPads and tablets are used by even children in kindergarten an on-paper printed comic-strip is simply "so last year".

"Märklino" needs movement - action, as in a cartoon or movie or an iPad game / app.

LEGO has for years made commercials that blatantly "stretch" the imagination regarding what the plastic bricks can do. Märklin should do the same.

The final nail-in-the-coffin for Märklin and "Märklino" is this article ➚ from January 28, 2014 in WirtschaftsWoche - www.wiwo.de - where the "Märklino" was introduced as a novelty.

I mean - if that was written in January 2014 - and we are now in 2016 - what has Märklin been doing for 2 years ? ? ?

Disclaimer : Perhaps there is more about "Märklino" to be found. I just haven't been able to find it as of February 2016.


Selling in DIY stores

In interviews the Siebers have stressed the need for marketing and selling Märklin also in the big DIY-stores i.e. selling in super-markets was not good enough.

Point being that Märklin could be sold for a higher price in a big DIY-store than in the local supermarket - ( ALDI ).

Only problem is that ALDI in Germany is Märklin's single biggest customer. Each Christmas ALDI has had a simple Märklin starter-set - sold for about 100 - 110 euro. These are very simple "Start up" sets.

ALDI Nord has approx. 2.500 stores. ALDI Süd had approx. 1.600 stores. If each store is allocated just 4 starter-sets that is 10.000 starter sets for ALDI Nord alone.

I doubt that Märklin is in a position to say to ALDI : "Nah - we won't deliver to you this year - we would rather try to sell at the DIY-stores".

But ALDI only get the "Start up" sets. Why ALDI don't get the "my world" or why "my world" has not been offered at DIY-stores yet is anyone's guess.

Presumably Märklin has been thinking that you need to get the buyers inside a "real" model railroad store to get them "hooked" on model railroad ?

I do not agree if that is the case. I do not care where the simple "my world" sets are sold. Let them be sold anywhere and then let the "real" model railroad stores have all the extra's for "my world".

Put information inside the simple "my world" sets about what the sets can be expanded with and an url / QR-code. Buyers will - in these - internet days be quick to find the "real model railroad store" to buy extra tracks / items.

"Start up" sets should be exactly the same.

Märklin must NEVER forget that the extras and the expanding is the one ( and only ) thing that differs Märklin from the 100+ Christmas railroad sets that comes from various China companies.

Yes - you can buy a cheapo Chinese railroad, but you are stuck with what is in the set. No possibility for expansion.


Uproar on social media

There - apparently - was rather a "dis-agreement" recently on "social media" regarding a statement from Herr Florian Sieber.

The discussion can be found on
Drehscheibe-Forum
"1-zu-160"-Forum
Stummi-Forum
Facebook-Märklin-H0-Forum

Florian Sieber had in an interview in Stuttgarter Zeitung ➚ expressed "concern" about the whole Märklin second-hand market saying that if people keep spending their money buying second-hand items - then they won't have money to buy Märklin's new items.
"... Da findet jemand ein paar Loks aus seiner Kindheit auf dem Dachboden oder erbt eine Sammlung. Diese Sachen werden dann bei Ebay oder ­ was für uns noch problematischer ist ­ sogar bei unseren eigenen Fachhandelspartnern verkauft. Da fließt Kaufkraft von der gleichen Zielgruppe ab, die wir auch mit unseren regulären Produkten ansprechen. ..."

and the remedy should be :
"... Wir wollen auf der einen Seite unsere Neuheiten über Innovationen und technische Feinheiten von den alten Produkten abgrenzen. Auf der anderen Seite müssen wir auch mit dem Fachhandel sprechen, damit der seinen Fokus wieder stärker auf unsere Neuheiten als auf die Vermarktung von gebrauchten Artikeln konzentriert. ..."

Florian Sieber explained this further in an TV-interview :
Märklin Chef Sieber reagiert auf Facebook Kommentare zu Neuheiten

Keywords / sentences from the interview :
- Digital - how much should be automated - how much should the customer program
- Learning by doing
- Wer hat etwas neues hast anderes

Basically Florian Sieber stated that Märklin's customers are very diversified - some want more and more detail - some just want robust and quality, but that Märklin would continue to offer high-end and high-quality products exploring the digital posibilities.

So the strategy is to make the newer Märklin models so much more interesting technology-wise that the older models will appear old and without value.

I am a bit concerned about this because Märklin has always had a backwards compability policy. It would be an easy solution for the Siebers to change that.

No backwards compability would mean that customers would have less interest in the older Märklin items. But this could also backfire.

Just as there are many model railroaders who run the tin-plate items on M-track there would probably be many who just kept the digital items as they are - and have been - from 1990 - 2015 and didn't care for the newer tech-stuff.

No doubt that the Siebers - being used to Simba-Dickie products - has not realized that there was such a huge market for second-hand Märklin.

But - I am surprised that they were surprised.

After all - what did they expect with locomotives that sells for 200 - 400 euro ?

Märklin is not BATA = Buy And Throw Away.

To be continued . . . I fear !


Florian Sieber was also asked in the video interview - from about 07:15 - what his dream project was.

His answer was that it could be fun to make a model-car - he didn't specify the scale - in metal like Märklin's other cars - but with all possible digital and mechanical gadgets - even moving windshield wipers.

He acknowledged that it would be a collectors item and rather expensive - but fun anyway.


Learning from model cars

It is not surprising that Florian Sieber looks at e.g. Schuco ➚ - the maker of model cars - part of the Simba-Dickie Group owned by the Siebers.

Schuco today makes several kinds of model cars. The sturdy solid metal cars that Schuco made in the 1960'ties and the more detailed larger scale cars that are more collector-items than toys.

I personally don't think that the detailed models - whether cars or trains - will ever have a big audience.

The collectors will always be there - and a few just collects and collects - but only a few can ever display their collection. A H0 locomotive takes up more space on the shelf than a Schuco model car.

So Märklin is back to the old toy versus model aspect.


Conclusion

There will always be born new children who will want to have toys.

"Model trains" used to only mean model toy trains.
Now - with technology - model trains can be either detailed model trains or toy trains.

Model trains still fascinate children - and it is interesting to see how also girls like trains especially when trains are part of a playworld.

Model trains takes up more space than model cars - and is not as plug-and-play as model cars or other toys - but model trains have survived so far and will continue to do so.

The Märklin brand is still very strong but it cannot stand on only one leg. Märklin need to Disney'fi and Lego'fi their products and to be where-ever children and grownups see trains.

"Deutsche Bahn" and "DB Museum" are just a few that springs to mind.
Why not a "my world" layout at the bigger train stations ?
Why not a special "my world" starter set at a very low price for sale only at train museums.

But - Märklin still has to accept that boys and girls will forget the model toy trains when boys discover girls and girls discover boys.

Then Märklin has to wait another 30 years before these customers return to be model railroaders again.

end of line








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