Lesson #5: Use Strategic Partnerships to Promote Your Products

In the spring of 1997, however, Warner made his first venture into conventional marketing when he joined up with McDonalds for one of the most successful promotions ever in the history of both companies. For five weeks, McDonalds customers would be given one of ten Warner toys with the purchase of every McDonalds Happy Meal. Smaller in size than the original Beanie Babies, these toys were called ‘Teenie Beanies.'

Warner explained that his decision to partner with McDonalds was to exploit the potential for reaching new markets. "We really did it to expand our product to children who wouldn't be shopping in upscale shopping malls," he said. "We saw McDonalds as the best avenue to get these kids to see them."

Over those five weeks, more than 100 million toys were distributed in what became the most successful campaign ever for both McDonalds and Warner's company. It got a whole new crop of children interested in the toys and propelled the company into new heights of success.

Flying high from the success of his first promotional partnership, Warner immediately decided to embark on a new one. This time, he teamed up with Cyrk Inc., a Massachusetts-based promotional company that helped Warner establish the Beanie Baby Official Club (BBOC). Diehard fans of the toy could now join the official club at a membership fee of $10. In return, they received a range of Beanie Baby paraphernalia, including a character checklist, a membership card and certificate, stickers, and a regular newsletter. BBOC members also had access to password-only sections of the company's website with top-secret news, and were eligible to order special Beanies that were for members only.

Due to the success of the BBOC, Warner and Cyrk began to introduce different levels of membership access. For instance, the BBOC Gold Kit would now include an offer to buy an exclusive club bear named Clubby, while the BBOC Platinum Kit automatically came with the Clubby bear. From there, the two went on to produce a line of promotional products that included trading cards, calendars, and trading card sleeves and storage cases. The trading cards lasted a total of four series.

Warner had disliked using traditional advertising and marketing strategies to promote his products. Still, when the time came, he was not above recognizing the potential that lay therein. By partnering with McDonalds and Cyrk, Warner was not only able to reach out to a whole new group of children, but to keep them hooked by giving them access to the BBOC and making them feel like a special and valued customer.