A Big Leap
In the Q2 2007 CC, while talking about toys & games Lee Cole said, “So you are going to see new types of games and more functionality.” I realized that this push toward “new types of games and more functionality” is what makes this a potentially extraordinary investment. The company may continue to grow the promotions business or possibly the lottery business, and that alone might make it a good investment, but if they can get enough functionality into these cards they could enter any number of huge markets. Let’s face it, the current cards, though they probably contain a great deal of technology, are not very interesting.
At the same time I also realized that it’s a tremendous leap from cards that are given away for promotions (or bought as glorified scratch cards) to cards that people will pay good money for, cards they or their children will want to play with over and over. It’s an entirely new type of product that requires not only a leap in technology but a leap in creativity in design.
So the potentially explosive growth depends primarily on
1. How much functionality they can get into the cards
2. Whether they can develop games/quizzes that are fun
3. And, for the collectibles market, whether they can design cards that are attractive enough to be collectible
Not having seen any of the new cards, having no idea what kind of functionality they have or how the cards will look, I feel I’m in the dark here….
But this does make the hiring of a person with a strong interest in design, a person they call a “creative visionary,” an intriguing choice for CEO.
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