The 4 Keys to Melissa & Doug’s Success

Dave Henderson
Chief Commercial Officer at Melissa & Doug

World-renowned toy brand Melissa & Doug is driven by a purpose: to ignite imagination and a sense of wonder in children. Though their signature wooden toys may be low-tech, the way they use their data to further that mission is anything but.

We sat down with Melissa & Doug’s Chief Commercial Officer, Dave Henderson, for a recent webinar unpacking the brand’s commercial success and journey to becoming a top 15 global toy manufacturer, sold in over 100 countries.

Here are the key strategies he says are central to the brand’s success:

#1 Making insights and analytics core to Melissa & Doug’s global commercial strategy

Henderson joined Melissa & Doug in May of 2020, as the world switched to virtual work and companies saw their supply chains and retail business disrupted by the COVID-19 pandemic.

In order to grow the business, Henderson had to first quickly determine the state of the business: “There’s artificial signals that are coming out of COVID trends. How the consumers behaving. How do you ensure that you understand the difference between what are some of those versus what is the true health of your brand and your business”

Henderson’s first priority was to determine how data was going to ground the brand’s decision making, and what they were going to look at and measure.

“We had to ground ourselves and what our business priorities were. Where did we want to grow? How did we want to grow there? And the data had to be at that root and that foundation of it. We engaged very quickly, all of our global retail partners and listened intently.”

Listening to customers and retail partners was essential. Melissa & Doug had assumptions going in based on what they were seeing in the data, but these conversations offered yet another critical data point. “We started to act on that and we acted very quickly as it came into that midyear and started to drive our brand in a different direction, “Henderson says.

“We have other tools that we work with, but taking the data, combining it with what we have and continuing to partner with the team at Alloy, you can go end to end. That's where I think the secret sauce and the win is — when you know what the POS is doing.”
-Dave Henderson, Chief Commercial Officer @ Melissa & Doug
#2 Infusing a culture of data across the organization

The first step to developing a culture of data-driven decision-making at Melissa & Doug was to understand the limits of data. The toy industry is part art and part science, Henderson says. “Sometimes when those kids decide on that trend,it doesn’t matter what all the numbers say. There is a trend. If you said you were going to do everything based on data, in the toy and entertainment space, that’s a big risk.”

Next is making sure you are using that data in decision making both internally and externally. “When you’re speaking with a Walmart or an Amazon or Learning Express, Kohls — any global retail partner — you have to be able to demonstrate to them you have an understanding of the data.”

“Understand where you are, make the best decisions based on the data, instill that with everybody and demonstrate to everybody that internally and externally your decisions are based on that. Because if you bring in that data and then you make the next 10 decisions that are contrary to the data, well then it’s just, why are we using that?”

#3 Making sure everybody in the organization has access to data for decision making

One of the first major tasks Henderson tackled upon joining was making sure that everyone in the organization had access to — from the executive team on down. “Fernando [Mercé] always wants me to mention that he is usually number one in terms of those active users as our CEO.”

Upon joining, only a few people in the organization were using the platform, and he made it a priority to make sure everyone in the organization had access and used it regularly.

“You have to make sure it’s in every part of your organization,” Henderson says. “Everybody has to have access to it. I work with members on the onboarding of everybody. We continually look and then support the team members who are there and those who aren’t there.

“Now, we don’t have every account up on right now. We have some of our top partners, but we’re looking to onboard more, so we can understand more about their business and how our brand and our items interact with them.”

It was an important step for Melissa & Doug to move toward one global source of truth so that anyone who was interacting with their key accounts was operating from a single trusted source.

#4 Measure performance against business objectives — especially for new launches

Henderson’s team used to keep a close eye on a few different key metrics: core trends, in-stocks, pricing, and new launches.

New product launches were especially important:

“A part of success for us in fall of 2021 was to flawlessly launch our Viacom products, new to market, set green with all the retailers for our modulars or planograms, but also make sure that we’re supporting ads and promotions and programs in line with what Viacom was doing … We could ladder all of that up. We created one dashboard with Alloy. What we were able to showcase is, what were the items that were at or above plan and why? And then we understood what were the items that weren’t. What we found out very quickly is we could read that trend, knew it based on factual data, where it was and whether it be a Target or anybody else, and then take action.”

Ready to learn more about how Melissa & Doug is achieving continued success in retail and digital channels with Alloy? Watch the full webinar replay now!



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