Each week, we seek out expert advice to help a small or medium-sized business overcome a key issue.
It's an unsettlingly surreal scene. Permanently pursed lips and blank, staring eyes lie about the cutting board, while bodies emptied of stuffing sit crumpled in the corner. And standing amongst the disarray is a grinning John Kernaghan.
Welcome to the workshop of Hogtown Mascots.
Mr. Kernaghan, the company's co-owner and a self-described mascot nerd, says the Toronto-based company is doing well, for a startup in a niche business. A sumo wrestler built by Hogtown recently strutted the red carpet with Saturday Night Live cast members to promote actor Seth Meyers's cartoon The Awesomes. Another of Hogtown's creations was used in an episode of the television series Beauty and the Beast.
The company has had no problem supplying one-off mascots for comic conventions and TV shows, Mr. Kernaghan says. But Hogtown would hit pay dirt if it could score a contract with a major sports franchise. "We're having trouble breaking into the franchise world, where we're going to get that large contract that's going to be our bread and butter throughout the year."
A one-off typically brings in $4,000, and Hogtown churns out five to 10 mascots a month. Mr. Kernaghan suspects a contract for a major franchise or sports association could be worth hundreds of thousands of dollars, hundreds of mascots and hours of revenue from "mascot maintenance."
But the competition is stiff. A third of North America's 15 reputable mascot makers are based in the Greater Toronto Area. The city, it seems, is the de facto hub for talking watermelons and googly-eyed dinosaurs.
Hogtown Mascots itself has grown up since Mr. Kernaghan founded it in his garage in 2005. He has brought on George Civello as co-owner, moved into a storefront and hired two part-timers and two contract employees.
But the company has hit a fork in the road.
"We've spent tons of time making cold calls and sending out e-mails, and sometimes we get one little job from that a year down the road," Mr. Kernaghan says. "But with limited resources the amount of effort we put into it doesn't pay off."
The Challenge: How can Hogtown Mascots capture the attention of big potential clients?
THE EXPERTS WEIGH IN
Richard Powers, sports marketing expert, Rotman School of Management, University of Toronto
Instead of seeking sports contracts, Hogtown should look to other channels or adjacencies and create new markets. It should show corporations – something like Bell or Royal Bank – why they need a mascot. Find an unconventional or overlooked market, then do a mockup or give away some freebies.
Look at Post-it. They sent out free sample to Fortune 500 companies when they first developed their notepads to see if they'd use them. Within weeks they were inundated with requests.
Show them the product's value. Go to them and say, "Can we have permission to use your name? We're going to do a mockup for you and if you think it has value you can pay us after."
Cheri Bradish, Loretta Rogers Research Chair in Sport Marketing and an expert in ambush marketing, Ted Rogers School of Management, Ryerson University, Toronto
When looking for a big client, it's about building relationships, communicating your services and creating opportunities for growth. To do that Hogtown needs to use social media and make key influencers in the sports world and on the business side see what they're doing. Over the next five years, with the NBA all-star game coming to Toronto, the Pan Am Games and other events, there will be a global focus on Toronto. If Hogtown can hit those events by working with teams or corporations and get some attention and recognition, then how could that not spill over into a more global-reaching audience?
And they've got to be creative with how they present themselves to potential clients – think authentic, experiential connections. For upstarts and entrepreneurial companies the world is a bit of an oyster in how they want to present themselves. They need to find something that works for them, in their brand's voice and in line with their values.
Also, in general, I think they might want to adapt, rethink or broaden their business plan. They could add new services and offer a variety of creative things under the Hogtown umbrella.
Joel Leveille, president, International Mascot Corp., Edmonton
International Mascot started out in very similar way, doing local stuff, picking up high-profile accounts every once in awhile, until we got the contract to build the Kool-Aid Man for Kraft in 1982. It grew from there, and in 1988 we got the Olympics in Calgary.
In a market that is so vast, there's no need to become territorial or highly competitive. The mascot costume industry is continuing to grow. One of our successes has been forming strategic alliances with other costume companies; we join with them when we need help with particular projects.
Also, to network or get insight into certain markets, join associations. For example, if Hogtown decides they want to market their product to pizza companies, go to the pizza show or exposition.
THREE THINGS THE COMPANY COULD DO NOW
Look for adjacent markets
Investigate untapped niches – new customers that don't use mascots – and convince them of their worth by giving away freebies or free demos.
Target key influencers
Connect with key thought leaders via social media to help get the word out about product and services.
Form a strategic alliance
Partner with similar companies or customers to help drum up business.
Interviews have been edited and condensed.