You'll never see it on toy store shelves, but Eric and Jackson Dott had the secret hit of this year's Toy Fair, the annual New York extravaganza where retailers stock up for the coming year.
The father-son management team of Baltimore's Monarch Avalon Inc. had toy executives and retail managers clustered around their latest board game, a one-of-a-kind spoof on the toy industry they called Pursuit of Insolvency.
The Dotts, who made their sample of Insolvency to entertain their friends and not to sell, designed the game so that players would lose money while marketing games. Roll the dice enough and you were guaranteed to end up in bankruptcy court.
Like many Monarch Avalon games, Pursuit of Insolvency was clever, witty, true-to-life . . . and unprofitable.
And up until recently, many in the game industry feared Monarch Avalon was pursuing insolvency in earnest.
Buffeted by competition from a new generation of computer and board game makers, Monarch Avalon's sales had plummeted. The maker of games ranging from the technically sophisticated war game Gettysburg to the risque Dr. Ruth's Game of Good Sex had lost money from 1986 to 1990. Their bread-and-butter products, complex war games, suffered from a host of socio-economic changes: growing competition for entertainment dollars, aging players, Americans' declining interest in reading, and a shortage of modern wars interesting enough to serve as game models.
Their game sales had dropped from $7.3 million in 1986 to $4.4 million in 1990, and the company lost more than $1 million in the same period. Monarch Avalon's stock, traded over the counter, sank from a high of $13.50 in 1986 to about $1.50 a share.
Although the company's stock is still depressed, the Dotts are able to poke fun at their own -- and their industry's -- financial troubles now.
Since assuming the presidency of the family firm in 1990, 33-year-old Jack Dott has pared back operations dramatically, bringing Monarch Avalon $418,000 into the black for the fiscal year that ended April 30 -- the first annual profit in five years.
Now, as they prepare for this year's Christmas selling season, the Dotts are looking to the future. They hope to start their company growing again, but are torn between wanting and fearing a mass-market hit.
They have lost millions investing in things like "Hideababy" dolls and science fiction games -- products that, they thought, would capture the fancy of parents nationwide.
So, they are trying to protect their core market, the middle-aged males who like to play war strategy board games. At the same time, Monarch Avalon's game designers are developing and marketing simpler board and computer games for kids and adults.
Even the Dotts admit they have no idea whether their new strategy will work.
The game industry is like one of their games, the Dotts say. It is a lot of fun, but your fate often rides on something as unpredictable as a roll of the dice.
A fun company
Many people might think designing and play-testing games all day would be just about the world's best job.
Though they've had some tough times, Jack and Eric Dott say they do have a lot of fun.
Eric Dott, the 63-year-old founder of the company, looks a little like a cleaned-up and kindly version of Grandpa Munster. He distributes both chocolates and jokes liberally to his 150 employees.
Jack says people tell him he is not "crazy like your dad." But while posing for a picture, Jack extemporizes a quick rap song and dance, then waggles two fingers behind his father's head.
They are, in fact, alike in many respects.
They are both pack rats. Their offices are cluttered with sample ++ games, stress dart boards, James Bond movie posters and piles of job applications.
Neither of them plays Monarch Avalon games in their off hours. "They are too damn hard for me," Jack says of Avalon Hill's war games, which feature large fold-up maps and 45-page rule booklets.
And both men seem to enjoy taking care of details that could easily be handled by employees.
Eric Dott personally oversees the decision of which chocolates to buy for Christmas gifts.
And Jack concedes he has difficulty delegating while he unloads boxes of imported dice from his Chevy Blazer into the company warehouse.
Though there is no formal division of duties and there are occasional disagreements, the two get along.
"It is a fun company. I always wanted to work for my father. I never went through that 'I hate my parents' thing,' " Jack says.
But running a fun and games business isn't all fun and games. The industry is notoriously cutthroat and fickle. Little-known Monarch Avalon has watched as high-profile companies like Tonka and Coleco soared and crashed in recent years.
In fact, Eric Dott, who started a printing house in 1949, took over Avalon Hill, the nation's first modern war board game company, after visiting the offices to see why his customer was going out of business.
A few minutes into that visit in December of 1963, Mr. Dott said he realized that the war games, including the still-popular Tactics II, were fine. The problem was that Avalon simply hadn't managed its business well.
"Everybody had a secretary. The overhead was incredible. They had a rug on every floor," said Mr. Dott, who today shares a bare-floor office with Monarch Avalon's vice president, Steve Szekely.
Eric Dott had given up playing board games when he was 10, ("I met girls," he explains) but he agreed to take over and try to save Avalon Hill. Within days, he got rid of Avalon's carpeted offices and all but a couple of employees. His cost-cutting quickly turned the game business profitable.
Winners and losers
Monarch Avalon has put out a total of 550 games by now, many of them attempts to create a bonanza like Trivial Pursuit. But none has become a mega-hit.
In fact, some of Monarch Avalon's games failed ignobly. Among the losers: Religious games such as Journeys of St. Paul; and Tufabet, a game the company touted as an "improvement on Scrabble."
Monarch Avalon has had special difficulty with games for children. For example, a game designed to teach kids how to tell time failed because it required the kids to read instructions. Company officials now realize that kids who know how to read usually know how to tell time.
"We haven't done a very good job of marketing to 8-year-olds," concedes Jack.
But many of its war games are money-makers. Squad Leader and its successor, Advanced Squad Leader (known as ASL to its fans) became the most popular tactical game in the U.S., selling more than 1 million units in the 14 years it has been on the market.
The Dotts even made money on some war games they weren't proud of. The company's own literature describes Kriegspiel, a war game based on World War II, as "a hastily put-together excuse for a war game that met a timetable but not much else. . . . [It] set the state of the art back 5 years." The game sold 86,000 copies, which is considered good for the niche.
The company's attention to detail in its war games -- on a recent day, a researcher was looking up World War II tank designs in a history book to make sure pictures of a new game's tanks would be accurate -- has won it a loyal following among its customers.
"Avalon Hill produces the best games out in the market," says Ken Whitesell, a longtime war game player who lives in Linthicum.
"Their production quality is the highest. Their maps are clear, sturdy and well printed. . . . And their rules are more complete," said Mr. Whitesell, who sometimes serves as a volunteer tester for the company.
The quality allows Monarch Avalon to charge up to $50 apiece for ASL and other top-line games.
But it is costly for Monarch Avalon to maintain its leadership of the tiny war game market.
Getting games into print can be a trial. An incredible amount of costly research goes into each game, and deadlines are constantly ignored.
Game designers "are like artists. . . . They are judged by their peers and they want to put out masterpieces," Eric Dott explained. The most recent ASL scenario, Gung Ho, took two years to get into print, he said.
Despite its efforts and reputation, Monarch's war game market seems to be shrinking.
The group of people interested in buying war games is getting older, said Winston Hamilton, who is executive director of the Game Manufacturers of America.
And young people don't appear to be willing to spend the money or time to learn the complex games, he said. "Fewer people know how to read and write, and you must know how to read to play these games," Mr. Hamilton said.
Part of the problem is historical, he said. World War II, the most popular subject of war games, seems like ancient history to most young people. Recent wars haven't sparked the interest in strategy the way World War II did, he said.
No one has marketed a Vietnam War game, for example, because Americans probably won't want to play at what is perceived as a tragic loss. Other more recent battles, such as Operation Desert Storm, aren't good game material because they were so lopsided, he said.
Younger men and boys seem to favor role-playing games, he said. The most popular role-playing game is Dungeons and Dragons, which is produced by one of Monarch Avalon's competitors.
4 Last year, Monarch Avalon started fighting back.
After three consecutive annual losses and declines in game sales, Jack Dott, who had been running a computer games division, took over the presidency to try to bring the company's costs into line with its shrinking sales.
He closed the company's expensive but prestigious New York office, sold off inventories of outdated games, and got rid of a failing toy division. "We are trying to do some serious stepping back and look at every little thing, even like extra phone lines," he said.
"What we really need is more sales. Our No. 1 priority is getting into more outlets and expanding the existing businesses we have," he says.
But the Dotts seem torn over just how much effort they should put into searching for that elusive hit game. For example, they both hope a highly praised strategy game called Adel Verpflichtet (pronounced fair-FLEESH-tet) can be a mass-market hit.
But Jack Dott also fears a hit could ruin Monarch Avalon. "The worst thing in this business is trying to get a hit. . . . Look what happened to Texas Instruments, Coleco with the Cabbage Patch dolls and Tonka with the Pound Puppies."
"Companies get a hit and then kill themselves trying to follow it up. They spend so foolishly," he said.
Jack Dott has signed a contract with the Smithsonian Institution to design historically accurate, but easy-to-play, war games. A new version of Battle of the Bulge, with only one page of rules, is selling well, he said.
The company will continue to try to catch trends. Previous games on the James Bond character and "Top Gun" type jet fighters sold well. A Robin Hood game has sold moderately well since the release of a movie of that name, and Monarch Avalon is marketing gangster and pirate games to latch onto soon-to-be released movies on those subjects.
Though it has several role-playing games already, Monarch Avalon's most recent entry, a joke-filled outer space fantasy game called Tales of the Floating Vagabond, has started to win shelf space in national chains, including Waldenbook stores, Jack said.
Oddly enough, the recession may help the Dotts' turnaround drive.
Cash-strapped consumers seem to be turning to inexpensive games because they offer a lot of entertainment for a small investment. And Monarch Avalon is well poised to take advantage of the trend. It has lower costs and better quality control than many of its competitors because it prints and assembles the games in-house, Mr. Hamilton, the Game Manufacturers executive, said.
Though those familiar with the game industry say Monarch Avalon will likely continue to dominate the war game niche, there is debate over whether its attempt to broaden its market will work.
Max Lipman, president of The Armory, a big Baltimore-based distributor of games, said he likes Monarch Avalon games, but thinks the search for a mass-market winner may have been too costly for the company.
"Nobody out there puts a game together as well as Avalon. . . . But they've done a few things I don't agree with. They try to go after mass market, and that is not where they've been proven," he said. "They had a couple hits. Dr. Ruth's game came out at the perfect time. And they tried to come out with some others, but they haven't done as well."
Even Eric Dott concedes that after nearly 30 years of running a game company, he still can't tell whether his games will fly or flop.
"If I knew the answer I'd tell you," he said. "I don't think anybody knows."
SUMMARY
Competition from a new generation of computer and board game makers caused sales at Monarch Avalon to plummet. But the father-and-son management team hopes to start their company growing again.