Market Focus: Fun and Games Are Serious Business

Hobbyists aren't just sniffing glue

Markets Focus: Fun and Games Are
Serious Business

Many hobbies aren't serious, but there's no question that hobbyists are serious business - a multibillion-dollar industry, in fact. In an increasingly stressful world, people crave a chance to get their minds off their worries - and will invest in the fix that fills the need. For example, the toy train collector has an average annual income of $60,000 and numbers in the tens of thousands - and that's just official membership, says Roger Carp, senior editor of Waukesha, Wis.-based Classic Toy Trains magazine. Or consider scrapbooking, which may seem as throwaway as the paper and photographs it's created with. But is there anything throwaway about 19 million households who participate, and the $2.3 billion in revenue they generate?

A key point to understand is that although something may be "just a hobby," those that participate in it may not view it that way. Sandra Ghezzi, vice president of marketing, member services and education for the Craft and Hobby Association, based in Elmwood Park, N.J., says it's not just about a lively activity but a way of life. "This is about feeling a sense of community, and being able to express who you are by what you choose to do with your spare time," she says. "A lot of people would feel a part of themselves would be missing without these activities."

And you also must avoid preconceived notions. Take knitting, for example. You might imagine a sweet elderly woman in a rocking chair, but vibrant stars such as Cameron Diaz and Hilary Swank can knit one and purl two with the best of them. "The kind of people who make crafts are changing by the year," Ghezzi says. "There's a very large demographic to market to."

Another advantage of reaching hobbyists: loyalty. They may be fickle about brands, but when they find an activity they enjoy, it can be a source of spending for the rest of their lives. It's one of the reasons Carp's magazine boasts an 80 percent subscription retention rate. "And they don't put a small investment into [trains] either," he says. "Usually it starts between $300-500. Though they only have so much money to spend, if they truly love trains they'll make additions as they go along."

Craig Davis, president of Wichita Falls, Texas-based Fantasy Planet, which owns,
has also seen the effect in his industry. "There [are] very few people who just do one fantasy football league and then call it quits," he says. "I know people who've been doing it for 10 years - and they aren't going anywhere."

Which leads to another successful segment to market to: the online-based hobbyist. It's a no-brainer to target the online gamer but sports fantasy sites are also supplying a strong power player. Once regarded as an extremely niche area for "stat geeks," you wouldn't dare say that to a crowd of 20 million - the amount of people Davis estimates are involved in just football leagues alone, which exploded in the age of cyberspace. "The Internet has completely blown this thing wide open," he says. "When we started doing leagues years ago it was waiting for the newspaper's Monday box scores. Now thousands of leagues are hosted online and you get scores instantly. Everyone's talking trash with each other in real time."

In fact, he says a University of Mississippi study showed that the average player spends 3.7 hours a week on their leagues - again, mostly through their computers. The cost to enter a league is usually anywhere from $15 to nearly $2,000, Davis says, with prize money getting as high as $1 million. Advertisers are actually a major driver of the leagues and, Davis predicts, will continue to be. "We're getting away from subscription models because so much information for leagues you can get for free," he says. "Right now the demographics are 92 percent male, 18-54, with a household income of around $80,000. Those are sweet spots for advertisers."

The one concern about hobbyists is that they're too directly tied to the economy. Less money can mean less interest, but many fail to see the potential for the opposite effect. For example, Davis says that he sees many fantasy football leagues increase their attendance during tougher times because people may believe - whether rightly or wrongly - that it's a way to increase their income. "They save up their money all year long to play," he says. "They see it as something they know - to the point where they may have more faith in it than other places they could invest their money."

Gardening can also draw people during difficult times because of functionality, says Mike Metallo, president of the National Gardening Association, based in South Burlington, Vt. "People began using gardening more as a source of food, not just beautification," Metallo assesses. "Young people in their 20s are also joining in because of this, and also that it appeals to the vegetarian movement. When your beliefs can also save you money, it makes a lot of sense."

Ghezzi can particularly see chances for growth around the holiday time when money tends to get tight. "Many crafts also double as gifts you can send," she says. "Instead of making a floral item for fun, it now becomes a way to save money during Christmas. People also start selling their items at local fairs and on eBay as a way to turn it into extra income."

Though there seem to have been interest-themed chat rooms since the dawn of the Internet, many hobbies have been late to the social networking game. Davis is first to admit that his company and others have missed the boat. "We were too busy focusing on our site's information to really see the opportunity," Davis says. "In the next year you'll see us create a Facebook for fantasy which allows the player to enjoy hanging out with friends and have a one-stop shop for their interest. I think you'll see others follow suit."

Even the National Gardening Association only recently launched social networking and estimates just 2,000 participants, but is pleased by the activity so far. "We're seeing a need to trade seeds and even plants through online," Metallo says. Nevertheless, many hobbies may take quite a while for social networking to become popular because of the time factor. After all, Metallo points out, you can either spend your time talking about gardening - or doing it.

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