Radio Flyer: “Rolling” Theory into Practice

As the Chief Innovation Officer at Radio Flyer, my role is to keep a 102 year old beloved brand relevant to the changing needs of today’s families.  Generations of families grew up with Radio Flyer and have a love for the brand with many fond memories of their childhood in the iconic Little Red Wagon.  But relying on nostalgia alone is no way to win in today’s marketplace.  Prior to joining Radio Flyer, I had read The Innovator's Dilemma by Clayton Christensen.   I was fascinated by the stories of leading companies being caught off guard by new entrant competitors with a seemingly inferior product that would get better over time and steal business from the incumbent market leaders.  I didn’t have the opportunity to put the theory into practice until later in my career, but the concepts and stories made an impact on me from the first reading.

Disrupting The Little Red Wagon

Radio Flyer has been the leader in kids’ wagons since our founder, Antonio Pasin, created the Liberty Coaster wood wagon in 1917.  The Radio Flyer steel wagon was so popular for so many years that it was even inducted into the Toy Hall of Fame.  These classic steel and wood wagons were best sellers for over 70 years until molded plastic wagons entered the market in the 1990’s.  Consumers liked the molded seats, cup holders and the fact that plastic wouldn’t rust. Radio Flyer struggled to compete with the plastic molders until 2003, when it debuted the Pathfinder plastic wagon.  The Pathfinder went on to become the best-selling plastic wagon, re-establishing Radio Flyer as the market leaderIn order to meet the needs of our most demanding customers, our designers and engineers continued to add innovative features to the plastic wagons, including such things as a sun protection canopy, versatile seating, parent cup holders, all terrain tires, fashion fabric seat cushions, and even personalized nameplates.  As our plastic wagon line was moving up market with these sustaining innovations, we noticed a new, low cost folding wagon enter the market at Sporting Goods stores and Warehouse Clubs.  The folding wagon had a scissor action folding steel frame on the outside of a rectangular fabric liner.  It was easy to fold up by pulling on a strap in the middle of the wagon, but lacked all the features of a wagon for kids. It looked to me like a text book low-end disruptive innovation as it seemed to check all the boxes:

1.  Initially considered inferior - Yes, the performance didn’t measure up to the deluxe plastic kid wagons because it didn’t have all the features Mom wanted (no seats, no kid cup holders, no canopy, no seatbelts).

2.  Cost is usually lower – Yes, the product had less features and a lower cost than plastic wagons.

3.  New entrant –Yes, folding wagon makers didn’t sell plastic wagons or wagons for kids.

4.  Not selling to our current customers – Yes, they weren’t selling to Toys R Us, Target, Walmart, and they couldn’t sell to toy departments or put kids on the package, since they didn’t pass the ASTM toy standards.

It would be so easy to overlook this competition based on the facts that it was an inferior product, that it wasn’t targeting our core consumers, and that it wasn’t sold to our key retailers.  Even though these products weren’t directly competing with us on the same shelf, we recognized that this was a threat to our business because we’d read Christensen’s articles and books.  The folding wagons were getting a low-end foothold through an alternative distribution channel and sales were building.  Since new entrants usually win with a disruptive innovation, we were concerned and started to do some research.  We noticed lots of families posting pictures on social media with their kids in these wagons (not just cargo).  What?  We thought, “What are they doing? These wagons aren’t safe for kids!"  Our approach was to create a kid-safe version of a folding wagon with seatbelts and padded seatbacks.  We came up with a patented folding mechanism that eliminated pinch points and enabled the wagon to convert to a bench by zipping down one of the fabric sides.  The 3-in-1 EZ Fold Wagon sold so well that we soon added a deluxe version with a pop up sun protection canopy.  Within a year we were selling more folding wagons than plastic wagons.   Understanding the theory allowed us to spot the disruption and intercept their up-market trajectory before it was too late. 


What job does Mom/Dad hire a wagon to do?

We ask that question a lot within the Radio Flyer Product Development Team.  Two summers ago, I sent an email to the entire company asking everyone to take photos of folding wagons in use.  As my fellow Flyers were attending their kids’ sporting events and other family outings, they took photo after photo of other people with folding wagons and sent them into our internal research team.  At the end of the summer, we had received 275 photos of wagons piled high with chairs, coolers, blankets and more.  We pinned up the photos in our product development project space called the “Engine Room” and started to group the photos into clusters.  We always knew storage was important but we were surprised by some of the extreme users and how much they overloaded the wagons.  We called one of the clusters “Cooler takes up half the wagon,” and another was called “Too much stuff, no space for kids.” 

The themes started to emerge.  It was clear that parents were hiring these products to haul a lot of stuff to these sporting events, family outings, and all day trips to the zoo. The progress many were trying to make in these situations was often simply the physical progress from the parking lot to the event.  We didn’t have to dig too far into the social and emotional factors because the functional requirements were so clear.  Yet, as a father of four boys, I understand the emotional stress of getting out of the house on time on Saturday morning with everything that we needed for a full day of soccer games.  Parents we interviewed would often ask for a wagon trailer to carry more stuff, but we knew adding a separate trailer is just one more thing to store in their garage.  Instead, we came up with a patented fold down platform in the back of the wagon called a cooler caddy that could hold 3 camping chairs, a large cooler, and more.  The cooler caddy platform folds up along with the EZ Fold Wagon when not in use.  The 3-in-1 Tailgater Wagon with Canopy became one of our top selling wagons last fall and is selling better than the plastic wagon it replaced.  Using the Jobs To Be Done thinking, we were able to move up market in the folding wagon category and replace ourselves before someone else did.

Applying the theories of Disruptive Innovation and Jobs to Be Done to our business has helped Radio Flyer to not only stay relevant, but to actually build on the love that people already have for the brand.  Our expanded line of innovative wagons, tricycles, ride-ons, and scooters allow today’s families to engage with the brand in new and different ways, allowing them to create even more warm memories than their parents or grandparents.

Tom Schlegel

Chief Innovation Officer

Radio Flyer, Inc