The name really says it all. Discovery Toys sells a variety of interesting toys for kids. We're not just talking about any toys either. The company has a strong emphasis on toys that help children to learn and develop. The idea is an interesting one, which could help the company to stand out.
This field is also an unusual one for network marketing. There are some other companies that sell kids toys or kids' clothing, but not a large number of them. Most companies operate in markets that have a larger potential audience, such as health and wellness or weight loss.
Selling products targeted at kids (and families, to a lesser extent) has advantages and disadvantages. On the plus side, the demand certainly exists. There's even a resurgence of interest in traditional forms of entertainment, including games and books, as many parents feel that their kids are spending too much time using devices and other electronic entertainment.
Of course, the products mostly just appeal to people who have children of the right age. You might be able to sell some items to more distantly related family members or to teachers, but parents would be your main audience. This significantly limits the number of people that you can sell to. A limited audience like this can make it more difficult to expand and to get the customers that you need.
It also helps if you have kids yourself. While having your own kids isn't a requirement of any type, customers are much more likely to take you seriously if you do. Selling toys when you don't have any kids of your own just ends up looking a bit odd.
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Two Ways To Make Money With Discovery Toys
Discovery Toys features the two general ways of making money that you'll see over and over again. The first is that you're earning by selling the products themselves. The other is that you're trying to build a team.
While these two ways to earn are common enough, each company has differences in their approaches. Because of that pattern, this post examines what Discovery Toys has to offer and whether you could look to the company as a way to make money.
The product range is really what makes Discovery Toys interesting. As the name suggests, this company is all about selling toys for children, which isn’t something you often see in an MLM. That could be a good thing or a bad thing when it comes to making money through the company.
The first thing I noticed about the company is that they certainly have an emphasis on toys and on play in general. For example, the catalog is broken down into different types of toys based on the types of play involved.
At the same time, the company also uses a set of symbols for products that illustrate the way that the products support children with special needs and autism. That’s a pretty unusual approach, but it does make it seem like the company is more focused on child development than most other toy companies.
The company sells a wide range of different toys and many (but not all) of these are unique to the company. For example, here is one item from their ‘make-believe play’ section:
The prices for toys vary considerably. In some cases, toys might be below $20, or in other cases, they might be $70 or more. Many fall somewhere around the $30 to $40 mark.
I don’t personally buy toys for kids, so I couldn’t really tell you whether the prices are any good. But, it would probably be a matter of finding an appealing toy and seeing what comparable toys were on the market.
It is also important to note that many of the toys might be unique, but they often aren’t unique in concept. So, in many cases, you could find similar toys elsewhere and in some cases, you might even find some cheaper alternatives.
Overall, the company has a great diversity of products along with some that seem pretty unusual. Add that to the focus on child learning – and I can imagine that the products would be popular.
Reviews of some of the products on Amazon also reflect that idea.
Across Amazon, I noticed that most of the products received somewhere between 4 and 5 stars, and many of them had quite a lot of reviews. That trend suggests that the toys are generally popular and are probably of decent quality.
The presence of Discovery Toys products on Amazon might seem like a bad thing, as it means more competition for distributors. While Amazon does provide customers one more place to buy, the products on Amazon are actually more expensive than they are from Discovery Toys.
At the end of the day, I think the products from Discovery Toys are more unique than most MLMs and in many cases, the prices do seem reasonable. Those two factors, along with the positive reviews from many of the products, do put this company a cut above most other MLMs.
So, the company has decent products, but what about the opportunity?
Well, Discovery Toys is another company that uses a party-based approach. This approach promotes the idea of selling the products in physical parties or through virtual parties.
A physical party is the same basic concept of a Tupperware party from back in the day. In this case, you would have a group of people (mostly mothers, I imagine) get together and the distributors would show the different toys. Given the products are targeted at kids, you’d probably find a fair few children at the party as well.
The parties tend to be ‘hosted' by someone the distributor knows. Party hosts get various discounts and free products if the party gets enough sales.
This approach helps to encourage hosts to invite as many people as they can think of. The design can work well, but the party has to be reasonably successful for the host to get any benefits.
As part of the party approach, the distributor will give a presentation and showcase what Discovery Toys has to offer. That brings me to one of the challenges with a party approach. The whole idea is that you physically show different toys. You could show them out of a catalog, but potential customers would tend to find that less appealing.
So, showing off physical toys means that you would actually need to buy them. As the company has a large product range, you’d probably find yourself buying toys that you didn’t actually want or need to help you sell them.
I’ve known people involved in party-based MLMs and that cycle really does happen. The distributors end up buying products in order to show them off. They often feel like they are getting a great deal, but they frequently buy products that they don’t really need and wouldn’t have purchased otherwise.
Buying a product at a discount isn't a “good deal” it's a cost of running your business. Unless you start thinking about this venture as a business instead of a hobby, it's likely that you'll lose money, or make something less than minimum wage.
Likewise, you see distributors make purchases to get the value of a party over one of the thresholds shown in the graphic above. In many cases, distributors end up spending a decent amount of money buying products. That makes it so much more difficult to actually make any money from the company.
Now, you can do parties digitally. That basically means that you just end up collecting orders within a specific time frame and they count towards one party. Doing that is much harder than it sounds, but if you do take your business online, it would be the best way to profit in my opinion.
As someone without a huge network of friends and family to rely on for sales, I would definitely need to reach out to the internet in order to make consistent sales.
As for income, the base commission rate is 25%. This means that, theoretically, a $40 sale would earn you $10. The amount might be a little different in practice due to factors like tax and shipping, but that estimate should be pretty close.
Interestingly, the company makes a big deal out of what you get from different tiers of parties but provides little information about what you earn in terms of money.
One of the few indications on the company’s site is that distributors can earn up to 34% profit on sales and up to 7% as bonuses from the sales of their team. But, note the phrase up to. Those figures are what you might earn high up in the company, but they probably aren’t what new distributors earn.
After some digging around online, I was able to find out some more information.
For one thing, this is what you can actually earn financially from a party:
So, basically, if you sold $400 worth of product at a party, you could earn either $80 or $100. That’s not horrible, but it’s not as great as it sounds either.
The odd thing about the table is that column on the right: wages per hour. It’s basically assuming that it takes four hours to do a party. That might count some preparation time, but honestly, it isn’t realistic.
Once you count in all the time for planning, inviting people, finding a good time, actually hosting the party, and taking the orders – you're likely to be spending much more than four hours. You may have some expenses too, like gas for traveling to the location and any snacks. The time and expenses can add up, especially if you don't get many (or any!) sales from a given party.
The other side of things is the idea of building a team. Discovery Toys mentions that you can get up to 7% bonuses on the sales of your team, along with the potential for other bonuses.
To do this, Discovery Toys seems to run through a traditional rank-based structure. This approach means that you need to get promoted up through various ranks. The requirements tend to increase from one rank to the next and the income you can earn increases in a similar manner.
This style means that you need a progressively larger and more successful team to increase the income that you earn from Discovery Toys. To do so, you'd need to keep broadening your audience. Otherwise, you would run out of people to sell products to and recruit.
A related aspect is that many of the people you recruit will come from your own social circle and most would have been your customers previously. This makes recruitment a double-edged sword. It means that your personal sales might decrease because you lose a customer and the person you recruit may then be directly competing against you for customers.
You do make some income from their success, of course, so the design isn't a total loss. Even so, you could easily earn less from someone once they are a team member than when they were a customer.
Interestingly, increasing your ranks can also increase the percentage earned from sales. This means that members hit the full 34% profit margin without developing a successful team.
What is this - the 1950's selling Tupperware? Gimme a break. It's 2020. If you want to build a business, you NEED to be online or your business will be dead in less than 10 years.
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