Average Is Beautiful An Opportunity Worth Pursuing

NA0433
Average is Beautiful:
An Opportunity Worth Pursuing?
Heidi M.J. Bertels, CUNY College of Staten Island
Michael S. Lehman, Lehigh University
Nickolay Lamm, a freelance designer working in Search Engine Optimization (SEO)1,

was sitting in his home office on July 1, 2013. During the first six months of the year,
he had been busy creating several visual representations of data that went viral. His
ability to make content go viral was critical, since his clients wanted to see content on
their websites that would drive traffic to them and improve their SEO rankings.
Just yesterday morning, Nickolay contacted a few online media connections he had
made over the past six months regarding a new creation about which he was very
excited. In this project, he made a visual representation of what Barbie® would look
like if based on body measurements for an average, 19-year-old American woman
utilizing data from the Centers for Disease Control and Prevention (CDC). The new
content was available only on a particular client’s website with the goal to increase
traffic and linkages to that website, thereby increasing its search rankings. This project
was personal to Nickolay as, during high school, he had struggled with his own body
image issues.
Nickolay quickly opened his email to see which of his online media contacts had
picked up his latest images. Nina Bahadur, a journalist for the Huffington Post, had
already posted an article online, which included images of the 3D photoshopped model
Nickolay had made2. He also had several requests in his inbox from other online
journalists asking for permission to share the story and images. Over the next few days,
the interest not only continued, but accelerated, as more than 120 new messages about
the “average is beautiful” images flooded his inbox. His previous projects had
generated online interest, but the buzz around this one was 10 times greater than
average.
A few days after the Huffington Post article first went online, Nickolay did a
double take when he received an email with the subject line: “Where can I buy your
doll?” This email did not come from a journalist, but from a mother. Over the next
few weeks, Nickolay came to realize that more than a quarter of the messages he was
receiving were from parents asking where they could purchase an actual doll that was
based on average body proportions. This was a very different response from what he
had experienced in the past - no one had ever asked about purchasing a physical
product based on his visual representations.
-----------------------------
Copyright © 2017 by the Case Research Journal and by Heidi M.J. Bertels and Michael S. Lehman. The authors
wish to thank Nickolay Lamm for his openness to sharing information. The authors are thankful for the
valuable comments and suggestions received from John Lawrence, Pauline Assenza, John Ogilvie, Gina Vega,
and the anonymous CRJ reviewers. This case study was prepared as the basis for classroom discussion rather
than to illustrate either effective or ineffective handling of a situation. An earlier version of the case was
presented at the 2016 Eastern Academy of Management Meeting in New Haven, CT.
Average is Beautiful: An Opportunity Worth Pursuing? 1
This document is authorized for use only in Prof. Sandeep Z's DXB/ EMBA - MEJune22/ New Ventures at S P Jain School of Global Management - Dubai from Sep 2023 to Mar 2024.
He wasn’t sure whether to feel disappointed at the prospect of having to tell the
parent that this doll was not for sale… or to feel excited because there seemed to be
some market demand for his “average is beautiful” concept. Nickolay paused and asked
himself an important question: “Is this the entrepreneurial opportunity for which I’ve
been waiting?”
EARLY EXPERIENCE WITH ENTREPRENEURSHIP

From the time he was age 14, Nickolay had dreamed of starting his own business.
Young Nickolay wanted to control his own destiny, and felt there was no need to work
for someone else. His mother, an artist and graphic designer who had moved the family
from Russia to the United States during Nickolay’s childhood, encouraged him to
pursue his entrepreneurial interests.
Nickolay’s first venture involved selling Russian glass figurines, which he thought
were “cool” items that potential customers might want to purchase. And in high
school, after reading about wholesale business models, Nickolay created an online
business as an eBay reseller, offering a mix of products - faucets, shower parts, and car
kits. He experienced his first big entrepreneurial “failure" with the eBay venture when
a shipment of products arrived broken, and his lack of insurance cost him upwards of
$10,000 in sales.
Despite this foray into the world of entrepreneurship, Nickolay never felt as if he
had found his niche. His interests were more aligned with product and graphic design,
as well as internet marketing. In order to further develop this skill set, he enrolled at
the University of Pittsburgh, where in 2012, he earned a bachelor’s degree in marketing.
Like most recent graduates, he then sought employment, ultimately securing a job at a
company that helped individual inventors patent their inventions and identify potential
industry partners.
AN UEXPECTED TURN OF EVENTS

It was January 7, 2013 when Nickolay returned to his job after the New Year’s holiday.
He had mixed feelings about earning his living from a “traditional” job. Nickolay’s
natural tendency was to question the way business was being conducted, identify gaps
in the company’s strategy, and offer solutions he could develop and implement.
However, this level of “forward thinking” was not in his job description. And then,
just a few hours into the first workday of the year, the news, perhaps a blessing in
disguise, came: Nickolay was being laid off.
Once the initial shock of hearing that he was without a job wore off, he realized
that he was actually happy about the decision that had been made for him. With
mundane work-related responsibilities, a fixed salary, and little opportunity for
advancement, Nickolay had frequently felt that this job, and perhaps life as an
employee, was not a good fit. But like many recent college graduates, he did not have
the luxury of a healthy savings account. In order to pay his bills, he needed to generate
income rather quickly. Nickolay considered two different approaches. “Should I start
sending out my resume, applying for other entry-level marketing jobs? Or, despite the
risks, could this be the perfect opportunity to go out on my own… and launch the
entrepreneurial career I have always imagined?”
After weighing the pros and cons and also gathering feedback and perspective from
family and friends, Nickolay chose the entrepreneurial route, eager to leverage a skill
set that he had developed while in college. Through multiple internships, independent
2 Case Research Journal  Volume 37  Issue 1  Winter 2017
consulting and even the “regular” job he just departed, Nickolay had become quite
adept at Search Engine Optimization (SEO). Through his work on SEO, he focused
on boosting the ranking and frequency of appearance of his clients’ websites in the
results returned by an online search, ultimately increasing user traffic to the site.
Nickolay considered the different strategies available to boost search rankings and
decided to concentrate on hyperlink building. He recognized that of the complex
algorithms used to generate rankings, the link-related factors remained very important.
He planned to leverage the fact that the more widespread a hyperlink to his client’s
website, through placement on other websites (such as national online media channels)
and on social media, the greater the chance that his client’s website would rise to the
top of an online search.
A NEW PATH FOR 2013: SPECULATIVE ILLUSTRATION

While Nickolay’s first ventures centered on Russian figurines, faucets, and shower
parts, his emerging passion, and focus of his new business, was in creating new and
interesting visual content. His head was filled with ideas for “cool” material which he
thought had the potential to go viral. He knew that if he could provide online
journalists links to these visual representations of data, there was a good chance they
would publish stories about them, and through that process, hyperlinks to Nickolay’s
clients’ websites. Furthermore, by having links to his client’s website all over the web,
there was a greater chance of an uptick in visitor traffic, which also would support the
rise in their search rankings. Nickolay’s ideas for creating new data-based visual content
or “speculative illustrations,” combined with his knowledge of SEO, growing track
record in effectively using Google analytics, and design talent in using Adobe Illustrator
and Photoshop, gave him the foundation for his new entrepreneurial venture.
Nickolay started by identifying data he thought the market would find interesting
and envisioning how to represent it in a compelling manner. He then found and paid
subcontractors across the country to execute on his vision. For example, in March
2013, two months after he was laid off and a few months before Prince William and
Kate Middleton welcomed their first child into the world, he developed images on what
the royal baby would look like at age 25 (Figure 1). He began by consulting with a
graduate student from MIT who studied genetics. He then worked with freelance
Photoshop artists he identified through websites like Elance (now Upwork) to visualize
the student’s hypotheses about the royal baby’s future looks. This speculative
illustration was published by several online media, including the Huffington Post,
Business Insider, Marie Claire, Independent, and the Telegraph.
FIGURE 1: Image from “What Will the Royal Baby Look Like at Age 25?”3
Because he knew how to effectively manage SEO, as well as virtual teams of
subcontractors, he was able to monetize his true passion: “Creating things people have
never seen before… bringing new visual representations into the world.” Over the next
few months, Nickolay was able to support himself financially through his
entrepreneurial approach. He secured new clients, and his existing clients retained him
for additional support in helping to drive traffic to their websites via a steady flow of
artwork that went viral.
Table 1 provides examples of the original visual content Nickolay created over the
next few months, as well as the dozens of media placements secured, while working as
a freelancer.
TABLE 1: Nickolay Lamm’s 2013 (February – June)

Visual Content & Media Placements4
2013 Original Visual Content Selection of Media Placements

How to Make the iWatch Forbes, Huffington Post, BGR, ZDNet,
Feb Something You Want to International Business Times, Computer World,
Buy? LATimes
What Will the Royal Baby HuffingtonPost, Business Insider, Mail Online,
Look Like at 25? MSN, Mirror, OK! Magazine, Marie Claire,
Independent, the Telegraph, Evening Standard,
Mar MSN NZ
How to Make Google Glass Business Insider, BGR
Look Normal
Barbie, Bratz, And Disney Huffington Post, Huffington Post UK,
Princess Dolls Without BuzzFeed, Business Insider, Cosmopolitan, Mail
Makeup Online, Today, International Business Times
Sea Level Rise in Real Life Business Insider, Mashable, Huffington Post,
Apr Daily Mail, Yahoo!, MSN, Gawker, io9,
Boston.com, Washington Post
What If the Budget iPhone ZDNet, Business Insider, Computer World, PC
Came in Translucent Advisor, App Advice, LA Times
Plastic?
New York City On Mashable, Space.com, Business Insider,
Different Planets Huffington Post, Wired, Daily Mail, Curbed, io9,
Gizmodo
How Much Would It Cost Business Insider, The Daily Ticker, Huffington
May to Be Great Gatsby? Post, Mail Online, Mashable, BuzzFeed,
HuffPost Live, The Daily Ticker
What Would Barbie Look Huffington Post, …love Maegan, Yahoo!, Daily
Like If She Was a Real Mail, Business Insider, The List
Woman?
What We May Look Like in Forbes, Huffington Post, Huffington Post UK,
100,000 Years? Mashable, Discovery News, Daily Mail, Business
Jun Insider, BuzzFeed, ABC News, Good Morning
America, Fox News, MSN, Weather Channel,
Mashable, USA Today
Nickolay felt strongly about the power of the Internet: “I don’t think you have to
be a famous person to have your voice be heard in the world. You can create cool
things and with the power of the internet, you have a megaphone on you.” Nickolay
essentially turned a hobby, creating “cool” and unique visual content that he cared
about, into a dream job. And in the process, his rolodex of national media contacts
grew.
SPECULATIVE ILLUSTRATIONS AROUND BODY IMAGE

During the first half of 2013, Nickolay followed Facebook, Twitter, and the Huffington
Post on topics such as feminism, the environment, technology, and body image. These
were topics that naturally interested him. As he developed increasing awareness of what
went viral in those areas, he started to conceptualize and create speculative illustrations
in those spaces. He felt especially drawn to the topic of body image, and a series of his
visual representations started to focus on this area. For example, his portfolio included
visual posts of what Barbie®, Bratz®, and Disney Princess® dolls would look like
without makeup (Figure 2). As happened with much of his prior work, the media was
quick to pick up this interesting content, which was available only on the website of
one of his clients.
FIGURE 2: Image from

"Barbie, Bratz, and Disney Princess Dolls without Makeup” 5
While exploring the topic of body image, Nickolay had noticed that there was a
great deal of discussion about how the body of Mattel®’s Barbie differed from that of
a “typical woman”:
 In 1998, Barbie underwent a makeover where her figure was given more
realistic proportions and her makeup was made less profound. Mattel
indicated that these changes were implemented because girls in Barbie’s
target market, ages 3 to 11, wanted Barbie to be more reflective of
themselves, not because of complaints that Barbie presented a harmful
and distorted image of women6.
 A research study had shown that girls who were “exposed to Barbie
reported lower body esteem and greater desire for a thinner body shape
than girls in other exposure conditions,” noting that this effect
disappeared in older girls.7
 A 2011 blog post by Galia Slayen published in the Huffington Post
explained that Barbie would have a Body Mass Index, or BMI, of 16.24,
below the threshold for anorexia, and that she would likely have to walk
on all fours due to her proportions.8
Despite discussion in the market about these studies, Barbie continued as the
world’s most popular doll among girls of all ages, with 13.5 million “likes” on Facebook
and two Barbie’s being sold every second somewhere in the world.9
MOCKING IT UP
Nickolay was aware of all the controversy surrounding Barbie, but did not understand
why Mattel never released a fashion doll with realistic proportions. And, while
shopping for a doll for his niece, he was surprised that despite all of the criticism, no
other brands seemed to carry a realistically proportioned fashion doll. Excited about
the concept and knowing that one of his clients would fund the creation of such a
prototype, because of its potential for hyperlink building, he set off to generate a visual
prototype of a realistically proportioned doll.
Armed with the average measurements of a 19-year-old American woman from
the Centers for Disease Control and Prevention (CDC) and his own growing network
of freelancers, Nickolay created an “analytical mock-up” of what a fashion doll would
look like if she had the proportions of an average woman. Utilizing the data represented
in the “analytical mock-up,” he then had a “physical mock-up” created through the use
of a 3D printer. The 3D model then was Photoshopped to add in other features, such
as the face and clothing.
Late in June of 2013, Nickolay posted his speculative illustrations of “What would
Barbie look like as an average woman” on his client’s website (Figure 3). On June 30,
2013, he emailed a link to a few journalists with whom he had connections from prior
posts, hoping that some might spread the news. By doing that, they would increase the
number of links to his client’s website and consequentially, the website’s search
ranking.
FIGURE 3: Images from

“What would Barbie look like as an average woman” 10
THE ONLINE RESPONSE
On July 1, 2013, Nina Bahadur from the Huffington Post published an article11 on
Nickolay’s new images. Over the next few days, he was kept busy responding to
requests from many media outlets, including CNN, Good Morning America, and
Cosmopolitan, asking for high resolution images of his “average is beautiful” doll.
There were also multiple requests for written, phone, and TV interviews. The buzz
continued as his images were published and shared by BBC Radio, Business Insider,
BuzzFeed, The Daily Beast, Glamour, Examiner, LA Times, MSN, Smithsonian,
Today and televised on local television stations.
His campaign had been successful. As the content went viral, hyperlinks to his
client’s website were all over the internet, and the search ranking of his customer’s
website went up… and up and up…
After the hustle and bustle had quieted down, Nickolay reflected on the atypical
response he had received on his post from parents across the country. He had inquiries
from dozens of parents looking to actually buy an “average is beautiful” doll. In addition
to these emails sent directly to him, there were requests posted on some of the websites
that had published images of his “average is beautiful” visual representations. Some of
the comments included “I would love to buy a normal-looking doll for my kids” and
“this would be a great doll if it actually were to be produced.” Could the emails he had
received directly from parents, as well as the comments on these sites, be indicative of
a broader demand for an actual physical product? He knew that manufacturing a doll
would take more capital than he had available, but his gut told him it would be
worthwhile to investigate the potential opportunity.
THE DOLL, TOY, AND GAME MANUFACTURING INDUSTRY

During this time, notable changes were taking place in the doll, toy, and game market
(NAICS code 33993). Competition increased for more traditional toys as the portfolio
of electronic consumer products and video games increased and demand for toys with
more sophisticated technology grew12. Tablets and other electronic devices were
becoming more commonplace, and media companies increasingly focused on the
growing educational app market for kids.13
Competition in the industry was intense, with the main players in the toy and game
industry being Mattel®, Hasbro®, LEGO®, Bandai Namco®, and Takara Tomy®
Company (see Table 2 below for market shares of these companies). Other sizable
companies in the space included Leap Frog®, Playmobil®, and Vtech®. In addition,
there were numerous small toy companies emerging in the market.
TABLE 2: Worldwide Market Share of Top Toy and Game Firms, 2010-201214
2012 2011 2010
% % %
Mattel Inc. . . . . . . . . . . . . . . . . . . . . . . . 12.00 12.20 12.40
Hasbro . . . . . . . . . . . . . . . . . . . . . . . . . . 8.20 8.40 8.40
LEGO . . . . . . . . . . . . . . . . . . . . . . . . . . 6.00 5.60 5.00
BANDAI NAMCO Group . . . . . . . . . 3.00 3.10 2.90
Takara Tomy Company Ltd. . . . . . . . 2.70 2.70 2.50
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . 68.10 68.00 68.80
The toy industry relied heavily on the retail industry as part of the supply chain,
which was dominated by a few major players including Walmart, Target, and Costco15.
These retailers had the power to promote private-label toys and favor one toy or one
brand over another through the allocation of shelf space.16 In contrast, online retailers
like Amazon.com had the ability to offer a wide variety of toys, an attractive channel
for toy companies, due to limited overhead and higher margins when compared to
physical stores.
Those in the industry were observing that children were outgrowing traditional
toys at a younger age. While girls used to play with dolls until well into their teens, girls
now had stopped openly playing with dolls by as early as age eight.17 The lifecycle of
individual toys also decreased. The preferences of children could change rapidly and
unpredictably, and shifts in demand could be significant and sudden, as a result of the
emergence of “hit” toys and trends.
In order to gain and retain more customers, toy companies that historically focused
on developing products marketed to boys were increasingly focusing on girls. For
example, LEGO started to develop more girl-focused kits and Hasbro introduced the
Nerf Rebelle® line for girls.
COMPETING WITH FASHION DOLLS

All of these factors led to increased overall competition in the doll, toy, and game
manufacturing industry. In the fashion doll market segment specifically, the
competition was just as intense, often among Barbie-alternatives. Nickolay was keenly
aware of dolls that were, according to him, “attempts” to produce “healthier” dolls
than Barbie.
American Girl®, a line of dolls portraying girls of a variety of ethnicities from ages
8 to 11, was released in 1986 by Pleasant Company® and acquired by Mattel in 1998.
The dolls were priced at more than $100 each and a large portfolio of American Girl
accessories was available.
The Bratz line of hip-hop fashion dolls was introduced by MGA Entertainment in
2001 and saw enormous success, especially with older girls. By 2006, Bratz had about
40% of the fashion doll market. As the creator of the Bratz doll was previously
employed by Mattel, a long legal battle ensued to determine who owned the Bratz
rights, underscoring the intense competition in the industry.
And back in the 1990s, the “Happy to Be Me” doll, created by an independent
inventor, was available for a limited period of time. However, most dolls introduced to
the market did not become classics and were only produced and sold for a few years
as retailers needed to ensure a high turnover of products on their shelves and would
only stock the top-selling items.
Even with the ever-crowding market, Barbie remained very popular with an
average of eight Barbie dolls owned per child.18 However, little girls were not buying
Barbie dolls as often as their mothers did.19 Barbie’s core demographic was narrowing
from ages 3 to 9 to ages 3 to 6.20 Sales of Barbie had been going down over the last
decade, with a 6% decline in sales of Barbie dolls and accessories from 2012 to 2013.
Taking all of this market movement into consideration, Nickolay saw a gap in the
fashion doll market. He felt that there were no dolls that encompassed a four-pronged
value proposition of being 1) realistic in terms of body image, 2) wholesome, or
suggestive of good health and physical well-being, 3) of high quality, and 4) affordable
(Table 3).
TABLE 3: Competitors’ value propositions according to Nickolay
Realistic Wholesome High Affordable
Body Image quality
Barbie No No Yes Yes
American Girl No Yes Yes No (>$100)
Bratz No No Yes Yes
Happy to Be Me Attempted Yes No Off-market
Average is Beautiful Yes Yes Yes Yes
If Nickolay moved forward with his idea for the realistically proportioned doll, he
believed the first step would be to market the value proposition of being “realistic,
wholesome, high quality, and affordable” to parents. Then, the kids would get excited
about follow-on dolls and product line extensions, leveraging a business model with
multiple, interdependent revenue streams.
Nickolay realized his largest and most visible competitor would be Mattel (MAT
on NASDAQ). In 2013, Mattel employed almost 29,000 people worldwide, had
revenues of $7.1 billion and more than $900 million in net income. Mattel owned the
top four doll franchises in the world: Barbie®, American Girl®, Monster High® and
Disney Princess®. Of note, in 2013, sales of Barbie-branded products fell by 6%, but
sales for American Girl rose by 11%.21 Table 4 outlines Mattel’s consolidated gross
sales by brand for 2012 and 2013. 22
TABLE 4: Mattel’s consolidated gross sales

by brand, in millions, for 2012 and 201323
For the year % Change
2013 2012 2012 to 2013
Mattel® Girls & Boys Brands:
Barbie . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . $1,202.8 $1,275.3 –6%
Other Girls . . . . . . . . . . . . . . . . . . . . . . . . . 1,322.8 1,059.9 25%
Wheels. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 747.7 813.4 -8%
Entertainment . . . . . . . . . . . . . . . . . . . . . . . 1,042.6 1038.0 0%
4,315.9 4,186.6 3%
Fisher-Price® Brands:
Core Fisher-Price . . . . . . . . . . . . . . . . . . . . . 1,374.9 1,505.8 -9%
Fisher-Price Friends . . . . . . . . . . . . . . . . . . . 608.6 571.7 6%
Other Fisher-Price . . . . . . . . . . . . . . . . . . . . 137.2 174.8 –21%
2,120.7 2,252.3 –6%
American Girl® Brands: 632.5 567.5 11%

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48.7 46.2 5%
Total Gross sales . . . . . . . . . . . . . . . . . . . $7,117.8 $7,052.6 1%
FINANCIAL AND OPERATIONAL FEASIBILITY
In order to make a decision as to his path forward, taking into account the intense
competition from industry giants, Nickolay needed to be able to determine the financial
feasibility of a potential venture. During August of 2013 he conducted some additional
research.
First, he needed to understand what price he could charge for an “average is
beautiful” doll. He needed to determine a price that was affordable for potential
customers, but high enough so he would not only break even, but enjoy some healthy
margins for future product development and company growth. Barbie dolls were quite
affordable, at a price point starting at $12.99. But Nickolay would have to charge more
than $12.99 because his production runs would be significantly lower than those at
Mattel. On the other hand, a realistically proportioned doll based on Nickolay’s four-
pronged value proposition could command a higher price point. After weighing these
factors, he felt that $25 a doll, which would include shipping within the United States,
could work for the customer.
Second, in order to be able to determine the financial feasibility of his venture idea,
he needed a digital rendering of the doll to show to potential manufacturers. He paid
a subcontractor $7,500 for the digital rendering to make it easier to communicate with
manufacturers.
Third, he had to determine the range of manufacturing costs. After Googling
“China Product Sourcing,” he identified and then contacted more than 10 companies
that could help him fill this gap in his expertise. Nickolay eventually contracted with
three companies that specialized in product sourcing from China and could connect
him with manufacturers in order to obtain quotes for a first run of the product.
Nickolay paid a total of $7,500 to retain the services of these three sourcing companies.
Each of these companies identified two or three potential manufacturers,
providing him with seven manufacturing contacts and a good sense of what would be
a low, average, or high cost. Casting the net wide ended up being a good strategy. Some
manufacturers said they could not provide a quote either because they did not have
enough information or because they did not have enough experience in producing a
doll. Others provided specific quotes based on a minimum order quantity of 5,000
dolls. Based on this research, and a minimum order quantity of 5,000 dolls, he
estimated the manufacturing cost at $6 per doll, which included the doll, her clothing
and the packaging. In addition to the minimum quantity, Nickolay would also need to
pay approximately $28,000 for the tooling to develop the required molds to
manufacture the dolls.
Fourth, Nickolay needed to design a physical prototype of what the actual doll
would look like in order to show potential manufacturers and speak with potential
investors. He would have to contract with a designer to support these efforts. Based
on his experience working with freelancers, he estimated the total cost of this next
stage prototype to be around $10,000.
Fifth, he had to figure out how the dolls would get to the customer after they were
manufactured. He would have to work either with a retailer, which would expect a
significant margin, or with a company specializing in fulfillment and packaging. After
more research and communication with fulfillment companies, he estimated that
packaging and shipping to the customer would cost about $6 per doll. As Nickolay did
not want to charge US customers an additional shipping and handling charge, he would
include this as a variable expense he would incur.
In addition to these projected start-up expenses which would have to be paid out-
of-pocket (Table 5), there would be the opportunity cost of having to neglect his
freelance work due to the time he was devoting to moving the “average is beautiful”
idea forward. He would miss out on about $24,000 of freelancer income.
TABLE 5: Projected Start-Up Costs
Consulting with product sourcing companies (already paid) $7,500
Digital doll rendering (already paid) $7,500
Physical doll prototype $10,000
Tooling to develop mold $28,000
Manufacturing (*minimum order 5,000 dolls) $6/doll*
Fulfillment (shipping and handling) $6/doll
One-year foregone freelancer income $24,000
WHAT’S NEXT?
By the beginning of September 2013, a few months after the market buzz began about
his “average is beautiful” illustrations, Nickolay had completed a good amount of
research into the fashion doll industry. In addition, his skill in developing virtual teams
continued in the context of body image. Via collaboration with an expert on body
shape measurement, he created 3D models of the average man from different countries
by utilizing body measurements from the CDC and other country-specific databases.
This next round of visual representations was picked up by online sites including The
Atlantic, Business Insider, Huffington Post, LA Times and MSNBC.23
With the many requests by potential customers for a doll based on his first “average
is beautiful” images at the forefront of his mind, Nickolay knew it was time to make a
decision about what to do next.
Should he venture into product development, a new area of entrepreneurship for
him? Assuming he could charge $25 per doll, inclusive of shipping and handling costs,
how many dolls would he need to sell to break even? Where would he find the capital
required to start producing the dolls?
People also told him that he should consider reaching out to an established toy
company because he did not have an established brand. But would a high quality
rendering or prototype of an “average is beautiful” concept be enough to approach
incumbent companies?
In the end, Nickolay knew he had a number of avenues from which to choose:
 Should he explore the feasibility of a partnership with Mattel, Hasbro or
another established player related to his “average is beautiful” concept?
They had deep pockets and established distribution networks…
 Should he launch his own company and manufacture and market this new
doll himself? If so, should he identify business partners with skills and
resources that he lacked? These potential co-founders could also help to
finance the venture…
 Should he launch a new company as a solo entrepreneur? If he went solo,
how was he going to finance the start-up? Balancing all of the tasks of
starting a new company just by himself would be challenging…
 Or should he just ignore the market interest in the doll and continue to
pursue his passion of making beautiful speculative illustrations as a
freelancer? Another entrepreneurial opportunity may also emerge…
NOTES
1 Search engine optimization is “a methodology of strategies, techniques and tactics used
to increase the amount of visitors to a website by obtaining a high-ranking placement
in the search results page of a search engine…including Google, Bing, Yahoo and
other search engines.” Retrieved December 12, 2016 from
http://www.webopedia.com/TERM/S/SEO.html
2 Bahadur, N. July 1, 2013. “Normal” Barbie By Nickolay Lamm Shows Us What Mattel
Dolls Might Look Like If Based On Actual Women (PHOTOS). Huffington Post,
retrieved November 21, 2016, from
http://www.huffingtonpost.com/2013/07/01/normal-barbie-nickolay-
lamm_n_3529460.html.
3 Lamm, N., March 22, 2013, “What Will the Royal Baby Look Like at 25?,” Nickolay
Lamm, retrieved July 27, 2015, from http://nickolaylamm.com/art-for-clients/what-
will-the-royal-baby-look-like-at-25/
4 Composed based on information from www.nickolaylamm.com
5 Lamm, N. (2013, April 16). “Barbie, Bratz, and Disney princess dolls without makeup,”
http://nickolaylamm.com/art-for-clients/barbie-bratz-and-disney-princess-dolls-
without-makeup/
6 Moore, T. (1997, November 18). “Barbie doll to get more real / Smaller bust, wider
waist, flatter feet -- even her smile is changing,” SFGate, retrieved June 23, 2016, from
http://www.sfgate.com/news/article/Barbie-Doll-to-Get-More-Real-Smaller-bust-
2795230.php.
7 Dittmar, H., Halliwell, E., & Ive, S. (2006: 283). “Does Barbie make girls want to be
thin? The effect of experimental exposure to images of dolls on the body image of 5-
to 8-year-old girls,” Developmental Psychology, 42(2), 283–292.
8 Slayen, G., April 8, 2011, “The scary reality of a real-life Barbie doll,” The Huffington
Post, The Blog, retrieved from http://www.huffingtonpost.com/galia-slayen/the-scary-
reality-of-a-re_b_845239.html
9 Pearce, L. (Ed.). (2011). SIC 3942: “Dolls and stuffed toys,” Encyclopedia of American
Industries (6th edition, Vol. Manufacturing industries, pp. 1370–1371). Detroit: Gale,
Cengage Learning.
10 These images were downloaded from Nickolay Lamm’s blog because the original post
is no longer available on the client’s website. Images are identical. Lamm, N. (2013,
December 22). “What would Barbie look like as an average woman,”
http://nickolaylamm.com/art-for-clients/what-would-barbie-look-like-as-an-average-
woman/
11 Bahadur, N. July 1,2013. “Normal” Barbie By Nickolay Lamm Shows Us What Mattel
Dolls Might Look Like If Based On Actual Women (PHOTOS). Huffington Post,
retrieved November 21, 2016, from
http://www.huffingtonpost.com/2013/07/01/normal-barbie-nickolay-
lamm_n_3529460.html.
Cengage Learning.
13 Palmer, M., & Correspondent, T., October 14, 2011, “Companies target children’s
tablet aptitude,” Financial Times, retrieved August 22, 2016 from
http://www.ft.com/cms/s/0/fe945968-f055-11e0-96d2-
00144feab49a.html#axzz4I5X47CL6
14 Lazich, R. S. (Ed.). (2013). “Top toy and game firms worldwide, 2010-2012,” Market
Share Reporter, Farmington Hills, MI: Gale, Cengage Learning. Business Insights: Essentials.
Retrieved 22 Nov. 2015.
15 GlobalData. (2013). “Mattel, inc. (MAT) - Financial and strategic analysis review.”
16 2013 Mattel Annual Report.
Cengage Learning.
Cengage Learning.
19 Brown, A., July 17, 2013, “Little girls aren’t playing with Barbie dolls,” Forbes, retrieved
June 23, 2016, from http://www.forbes.com/sites/abrambrown/2013/07/17/little-
girls-arent-playing-with-barbie-dolls/#3148d3b91eb5
20 Ibid
Cengage Learning.
22 2013 Mattel Annual Report.
23 Lamm, N. (2013, October 16). “The Average Man,” http://nickolaylamm.com/art-
for-clients/the-average-man/

Average Is Beautiful An Opportunity Worth Pursuing

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Nickolay Lamm, a freelance designer working in Search Engine Optimization (SEO)1,

Average is Beautiful: An Opportunity Worth Pursuing? 1

EARLY EXPERIENCE WITH ENTREPRENEURSHIP

AN UEXPECTED TURN OF EVENTS

2 Case Research Journal  Volume 37  Issue 1  Winter 2017

A NEW PATH FOR 2013: SPECULATIVE ILLUSTRATION

Average is Beautiful: An Opportunity Worth Pursuing? 3

TABLE 1: Nickolay Lamm’s 2013 (February – June)

2013 Original Visual Content Selection of Media Placements

4 Case Research Journal  Volume 37  Issue 1  Winter 2017

SPECULATIVE ILLUSTRATIONS AROUND BODY IMAGE

FIGURE 2: Image from

Average is Beautiful: An Opportunity Worth Pursuing? 5

FIGURE 3: Images from

6 Case Research Journal  Volume 37  Issue 1  Winter 2017

THE DOLL, TOY, AND GAME MANUFACTURING INDUSTRY

Average is Beautiful: An Opportunity Worth Pursuing? 7

COMPETING WITH FASHION DOLLS

8 Case Research Journal  Volume 37  Issue 1  Winter 2017

TABLE 4: Mattel’s consolidated gross sales

American Girl® Brands: 632.5 567.5 11%

Total Gross sales . . . . . . . . . . . . . . . . . . . $7,117.8 $7,052.6 1%

Average is Beautiful: An Opportunity Worth Pursuing? 9

10 Case Research Journal  Volume 37  Issue 1  Winter 2017

Average is Beautiful: An Opportunity Worth Pursuing? 11

12 Case Research Journal  Volume 37  Issue 1  Winter 2017

Average is Beautiful: An Opportunity Worth Pursuing? 13

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