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Low Tech Marketability in a High Tech World- The Rainbow Loom

While the history of the rubber band traces its roots back thousands of years, the modern rubber bands invention has its origin in 1845, but it took almost 80 years before William Spencer first started mass producing rubber bands in Ohio, USA.  With all the advanced technological gadgetry of today’s modern world, one would think that a simple, nearly ancient, by modern marketing chronological standards, product like the low-tech rubber band would be going the way of the “once upon a time” scrap heap.  But not so, even today it is nearly impossible to imagine a world without rubber bands. The diverse industry is proving to be holding itself together and experiencing a resilient and rather elastic sales performance (all puns intended).

The retractable characteristics of the invention has literally thousands of uses across a variety of industries, from the lowly bands utilized in offices and homes around the world to more sophisticated industries like medical, automotive, aeronautics, propulsion and numerous toys, crafts and even sport. Joel Waul, of Florida, currently holds the record for the largest rubber band ball; it weighed a whopping 9400 pounds, exceeded 8 feet in height, and consisted of more than 700, 000 rubber bands! Clearly Joel had idle time on his hands.

The newest idle-time rage that is expanding and weaving new life into the common rubber band is the hottest frenzy to hit craft and toy stores in decades. Nine-year-old girls across the U.S. have apparently fallen head over heels for a centuries-old craft form, threading together colorful bracelets with the aid of a makeshift loom. Michaels Stores, the huge, private arts-and-crafts retailer, began stocking the $17 Rainbow Loom last fall and the kit is now selling ten times better than the chain’s next kid’s bestseller, says Philo Pappas, Michaels’ Executive Vice President of Category Management. Prior to this past year’s Christmas season, a million or so of the rubber-band hand looms have sold through various outlets, according to Cheong-Choon Ng, the product’s 45-year-old inventor, who until recently was a senior crash-test engineer for Nissan Motor Co. (NSANY), in Detroit.

Three years ago, Ng’s two daughters—Teresa, then 12, and Michelle, then 9—were sitting in the family den making bracelets from rubber bands. The process reminded Ng, who grew up in Malaysia, of making jump ropes from rubber bands as a child. Hoping to impress his kids with his bracelet-weaving skills, he grabbed a few tiny elastic bands and tried to mesh them into a pattern. They were too small for his fingers, however so the engineer went to his garage and cobbled together a primitive loom, an old wooden board lined with rows of pushpins. With that, he began looping rubber bands into bracelets. At first his daughters weren’t impressed. But once they saw him weaving intricate patterns in breakneck speed, they changed their mind. It was Teresa who saw the potential for transforming this into a business when other kids in their Novi, Michigan neighborhood began obsessively playing with the looms Dad was assembling. That was when Ng decided to take a leap of faith—staking the $10,000 he managed to save for his daughters’ college fund on building a marketable product.

He spent six months refining the design then he set about finding suppliers in Southern China, getting their first shipment in June 2011. By then, the rubber bands had already arrived. He remembers standing with his wife, staring fearfully at the giant crate in their garage: it weighed 2,000 pounds, as much as a small car. Sales were glacially slow at first. He went to trade shows and children’s camps to show off the plastic loom and often when Ng went to pitch store managers in person, he was asked to leave. But that changed after a single store in The Learning Express Toys chain picked up Ng’s invention in July 2012. The shop, in Alpharetta, Georgia, offered bracelet-making classes to show off what could be done with the inexpensive loom and soon kids started taking their kits to school, and good old network effects kicked in.

The Rainbow Loom is currently the biggest fad among elementary school kids. Reminiscent of the pot holder weaving sets of generations past. It is essentially, a plastic pegboard and a bag of multi-colored rubber bands, which allow allows kids to make colorful “friendship” bracelets and other kinds of jewelry, but the trajectory of the Rainbow Loom is one of those toy business success stories that capture entrepreneurial imagination. Like the slinky, it has gone from rags to riches. An enterprise underdog story! The toy has catapulted from its humble beginnings in a Michigan living room to a market sensation. In the beginning, Cheong Choon Ng made the first videos himself, turning to YouTube in order to show potential customers how to use the product. Now customers make instructional videos themselves.

Such stories of entrepreneurial success are not completely uncommon but in an era of high-tech, gee whiz gadgetry, to inspire such interest from today’s tech-drunk youth with such a simple old fashioned product is nothing less than amazing.  Whether the Rainbow Loom goes the way of the pet rock or finds a place in the toy hall of fame alongside the hula hoop and the slinky remains to be seen, but the Rainbow Loom is once again showing that existing, mundane technology and established tradition still have a market.

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