EFMD Award-Winning Case

The Imaginarium Case: A Toy Story

IESE Professors Lluis Renart and Francesc Pares tell the story of toy-maker Imaginarium in an award-winning case that illustrates the benefits relational marketing can bring when properly implemented. But while preparing the case, it wasn’t just the professors and their students who learned something.

“Once upon a time there was a little boy who had lots of toys. He kept them all in his room and spent long hours every day playing happily. One of his favorite games was to set up a battle between his tin soldiers. He stood them up facing each other and let the battle commence. When he was first given the soldiers, he noticed that one of them was missing a leg as the result of a fault during casting ...”

So begins “The Brave Tin Soldier” by Hans Christian Andersen. The Danish author, who lived from 1805 to 1875, never knew about Imaginarium, a chain of toy shops that opened years later, in 1992. If he had, the hero of the story might not have been a tin soldier, since the chain doesn’t sell soldiers or any other toy associated with war or violence.

This is just one of Imaginarium´s core values. Founded by Felix Tena in Zaragoza, the company now boasts 285 sales outlets in 23 countries. Imaginarium’s shops are recognizable for their originality. First of all, there are the two doors. One is a normal, adult-sized entrance, but the second is a much smaller replica, just right for children, the real stars in the world created by Felix Tena and his team.

But why is the IESE Alumni Magazine talking about children’s toys? The answer is simple. The Imaginarium story formed the basis for an award-winning case penned by two IESE professors, Lluis Renart and Francesc Pares. The case reveals how the toy company expanded its shops and its concept on a huge scale in a short period of time.
A Fresh Idea in a Mature Market

The key to Imaginarium is its chief executive and owner. Felix Tena was a toy manufacturer whose concerns differed from those of his colleagues. He had a clear idea that children deserved a product that was more carefully thought through than the toys accumulating in ever greater numbers in existing toy and department stores. He yearned to create educational toys that would provide children with something more than just pure entertainment. However, his idea was rejected by toy distributors, so he decided to go it alone and to launch his own concept.

And so Imaginarium was born. In order to ensure that the manufacturer’s values would continue right through to the point of sale, Tena decided that his products would be distributed only through his own stores, and he began by opening four outlets. It worked. New stores and franchises ensued and the idea and its spirit were exported to other countries.

IESE and Imaginarium

IESE Professor Lluis Renart has spent several years researching relational marketing. He is committed to showing that it is a valid formula for many companies, but that its success depends on a careful process of preparation and implementation. As the professor himself observes, “I always explain that it is not enough just to buy a computer program.” Renart has observed the benefits of relational marketing in various businesses. He has studied the design of the process and has identified the successes and benefits that companies can obtain from this new approach to their relationships with customers.
In January 2001, Professor Renart traveled to Zaragoza to lead a session in the Continuous Education Program. The theme was relational marketing. On this occasion, the subject was a company that was debating whether or not to set up a web site aimed at purchasers of its products. “Before the session began,” explains Renart, “I received a message from an IESE alumnus who was going to attend. He mentioned that his company was studying the same issue.” The alumnus was Ramón Añaños (PDD-V-95), at that time Imaginarium’s marketing director and a member of the IESE Regional Alumni Association in Aragon.

This was Lluis Renart’s first contact with the toy company, and the beginning of a story that would eventually reach IESE’s classrooms as the “Imaginarium Case.” Written by Professors Lluis Renart and Francesc Pares, with help from Laureano Berasategui, a researcher from IESE’s eBusiness Center, the case went on to win an award from the European Foundation for Management Development (EFMD).

As Ramón Añaños recalls, “At meetings of the Regional Alumni Association we had been talking about putting some of Aragon’s businesses in touch with the professors at IESE. At that time I was working at Imaginarium, so I contacted Lluis Renart and, when he expressed an interest, I went to the company’s founder and president, Felix Tena. He agreed to the idea.” Ramón Añaños was the main point of contact between the company and the IESE team. He worked closely with Lluis Renart and his colleagues by setting up meetings with managers from the company’s different departments.

What began as a relational marketing case aimed at analyzing how a company could introduce a new line of communication with its customers through its web site, gradually became something quite different. “We began to see,” says Renart, “that Imaginarium had a highly defined mission, culture and set of values. This formed the foundations on which the company and its products were built, and could be used to form the basis for a good relationship with its customers.”

A company’s values, in the opinion of the authors of the case, form the basis for any relational marketing program. Here, Renart and his team found a link between relational marketing and Juan Antonio Pérez López’s theory of motivation: “Extrinsic, intrinsic and transcendental motivation. A customer’s relationship with a company can merely involve an exchange of goods and services or it can be something more. This is where the values that a company can transmit to its customers come in.” Imaginarium was a clear example of a company which, motivated by a series of principles, was not only offering its customers a good product but was also concerned about issues such as children’s education.

According to Professor Renart, a company’s values must have a certain transcendental component so that they can be highlighted in a CRM program, and vice versa. “If a company wants a relational marketing program, it must be clear about its corporate values and culture.”

Thus, ideas such as “ensuring that children enjoy themselves more and better,” and “broadening children’s education and development” – as proclaimed by the company’s website – attract families. They are also lured by values such as “quality, safety, educational value, entertainment, no sexual discrimination and no military content.” Families respond to broader definitions relating to evolutional value for children or attempts to create “a better society.”

Ramón Añaños, who worked directly with the Imaginarium president, observes that Felix Tena “came up with the concept after realizing that the toy sector needed a company that represented certain different values.” Defining the company’s commercial strategy, he says that “Imaginarium takes a lot of care over the way it communicates with its customers, eschewing commercial interest and transmitting the message that ‘we take care of your children’s education.’”

It therefore employs “playologists” in its stores, staff who are specialized in education and can advise parents on the different types of toys, suitable age groups, educational value, etc. It offers the same service via its website.

Just One More Case?

The Renart-Pares team had already received several awards for their cases from the EFMD. The Imaginarium case is the fifth to be recognized and represents further backing for the research being carried out at IESE. “It is a recognition of the quality of the cases that we prepare at this school,” remarks Renart. “Each case results from the joint efforts of a professor, his or her team, and a company. The companies involved always benefit from their relationship with IESE in some way or another. For a start, their case will become known among IESE’s students, which is, in and of itself, important. In any case, many of the companies that have worked with us on the preparation of a case have done so unselfishly, purely so that their experiences may prove useful for other managers.”

Prof. Renart does, of course, have a very clear idea of how one should approach a company to suggest using it as the subject for a particular case. “We try to be very sensitive, and we always make it clear in advance: The case won’t be published without their approval.” This guarantee persuades many employers to make their experiences available for teaching and research purposes.

“A case involves exposing a situation as it is happening, either before the company has made a particular decision or, if the decision has been made, before the results are known. This is one of the keys to deciding whether or not we ‘have a case.’ With Imaginarium we reached the point at which the company was planning to implement a more ambitious relational marketing program with the launch of a card that could damage its customers’ perception of the company’s values, something which had a cost. The company said it was willing to cooperate, so we ‘had a case,’ and we wrote it up after receiving their approval.”

The “Imaginarium Case” is one of many cases that IESE’s professors publish each year and that demonstrate the school’s close contacts with the business community and the constant stream of knowledge and information that is being exchanged between the school and companies.