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A famous German mouse with large round feet, big ears, three strands of hair and a soft, cuddly body has set up camp in Delaware, but not many American children have heard of it.
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Diddl, a mouse, his girlfriend, Diddlina, their stuffed toy friends and a host of products from greeting cards to jewelry to soap can be found in a 2,100-square-foot warehouse in Middletown. Maryland entrepreneur Robert Steele has opened the sole Diddl distribution center for North and South America.

Popular in Europe, Diddl products are sold in 20 countries and in 16 different languages. It was the sixth-biggest toy license in Germany between 1994 and 2002, ahead of Batman, Sesame Street and the Lion King, according to a survey by the NPD Group, an international consumer research company in New York.

Diddl officially began test marketing in America in 1999, after Steele convinced Diddl's manufacturer to sell the product line using his Maryland-based company, KBI Inc. Steele, who makes a living selling candy in 65 locations including malls and colleges, was introduced to Diddl when his niece, who lives in Germany, showed him a stuffed toy, mug and pencils.

But Diddl remains virtually unknown in the United States.

One of Steele's early efforts to sell Diddls through mall kiosks and retail stores in Florida, Nevada, Pennsylvania, Georgia and other states failed. Now he hopes to introduce the toys to the U.S. market through Internet sales.

Although Diddl sales are small, they have been doubling every 10 months, reaching $100,000 last year, Steele said.

And Diddl's manufacturer isn't going to stop trying to get a share of the U.S. toy market, valued at $21 billion excluding video games. There are plans to open a concept store in a mall in Orange County, Calif., early next year and to hire sales people to target national toy and greeting card merchandisers.

Popular toy imports from Europe and Asia such as Teletubbies, Pokémon, Yu-Gi-Oh!, and even the Smurfs have penetrated the U.S. market by way of cartoons, video and card games and television shows. Most have relied on major advertising campaigns.

The manufacturer doesn't advertise, instead relying on word of mouth and point-of-sales connections with distributors.

"The whole goal of the line is not to be a fad item, but to become a constant in the marketplace," said Steele. "Our strategy is to do whatever grass-roots advertising we can do to stir interest in our product line."

A success in Europe

In Europe and other parts of the world, Diddl's popularity has spread through the exchange of gifts. The characters are often used to express friendship and love through greeting cards and other stationery. While Diddl products are purchased by people of all ages, the target market are girls between 6 to 14. Pen pals across the world are steady customers. Writing and drawing contests in different countries also has helped raise awareness.

But toy experts expect the company will have difficulty introducing Diddl to American children without some sort of aggressive advertising campaign or television show.

"They can't apply German marketing strategies in America," said Jay Kamhi, president of Kamhi World Inc. in Clearwater, Fla., which sells a line of talking key-chain mice called Spice Mice, originally marketed in Germany.

Kamhi, who used to sell Beanie Babies, believes advertising pays.

Appearing on television shows like Live with Regis & Kelly and in numerous newspapers have boosted sales of Spice Mice to 1 million units in the past year, he said.

Diddl was created in 1990 by artist Thomas Goletz and manufactured a year later by Depesche of Geesthacht, Germany, a greeting card and gift company. The first product was a line of postcards.

"The brand needs to be built," admitted Tom Graulich, managing director at Depesche. But he said advertising in the traditional sense is not the way to go.

"We like to have people discover Diddl - it has more value in that way. Once they dip into the Diddl world, the whole collection of friends and animals that there are, they like it."

Breaking cultural barriers

About 6,000 new toys are introduced in the United States each year, according to the Toy Industry Association Inc. in New York.

"It's a very big market in the United States, and there is a lot of competition," said Diane Cardinale, a spokeswoman for the toy association.

Al Kahn, chairman and chief executive of 4Kids Entertainment in New York, which helped introduce Pokémon and Yu-Gi-Oh! to the United States, said launching a foreign toy in America is challenging and costly.

"No one thought that these Japanese things would translate well for American or European children," Kahn said.

Before launching Pokémon in the U.S., Kahn said his company mailed about 1 million video tapes to 8- to 15-year-old boys on Nintendo's mailing list explaining the show and characters to an American audience.

Then the company created the television show, rewriting, editing and adapting it to this culture. This helped set the stage for other products that made the brand successful including toys, video games and trading cards. Acquiring the rights and marketing the launch of the television show costs $20 million to $25 million, he said.

"It's difficult because there are so many things vying for kids' attention," Kahn said. "We think if you can get television shows on every day, then kids start to embrace the programming they then might embrace the products."

Annual sales for Pokémon related products are now about $865 million worldwide.

Depesche officials don't expect Diddl to be the next Pokémon in America any time soon.

"Because we don't do advertising we build the business slowly," Graulich said. "It is not overhyped."

Some toys have succeeded without the hype.

Beanie Babies were not sold in mass market retail stores and they were sold in limited editions, making them collectible.

Steele hopes that will be the case with Diddl.

Depesche manufactures a limited edition of Diddl images on products.

And in some circles the products have become collectable.

Mark Bellomo, action figure columnist for Toy Shop magazine in Wisconsin, said that Diddl has potential. Diddl products range in price from 39 cents for a small notebook to $150 for 4-foot Diddl.

"The great thing about Diddl is that it is so understandable for people who don't speak German," said Bellomo. "Will it be accepted in American culture? I am not sure."

Copyright © 2004. The News Journal.