INSIDER / TOY STORY

Mega Brands Inc. knew it was in for a very merry Christmas way back in July. That's when Hamleys, the iconic U.K. toy chain, released its closely watched list of this year's must-haves. In the No.1 spot was the Battle Strikers Tournament Set, made by Montreal-based Mega Brands.

The idea for Battle Strikers had been kicking around for a while when Mega's product design team dusted it off for a brainstorm session three years ago. The concept was a twist on battling tops: Kids would use a joystick to launch a souped-up top (with names like Skullor, Ninjutsu and Tsunami), and then use a magnetic finger controller to try and knock their opponent out of the arena. "It's not a 'watch-me' toy," says Craig Johnson, Mega's director of sales and trade marketing. "The child is engaged in the battle and can control it." (And, at $40, it's affordable for parents hit by the recession.)

Battle Strikers got the go-ahead, and an army of designers, developers and engineers-both in Montreal and in China-set to work, using moulds and computer-generated 3-D sculptures, to build a prototype. Early feedback from retailers was good. More importantly, the kids and mums in Mega's test groups gave it a thumbs-up. By the fall of 2008, with the design team already working on the toys for the next couple of years, Mega had put the finishing touches on the entire line, from packaging for the 12 different collectible sets to marketing. Johnson says he knew Battle Strikers was going to be a hit when Mega took a demo to Hong Kong and a group of boys stood around and, though they spoke no English, got it right away. "They all screamed," says Johnson.

New York analyst Chris Byrne, a.k.a. the Toy Guy, first saw Battle Strikers at the October, 2008, Fall Toy Preview in Dallas, where toymakers from around the globe gather to gauge retailers' interest before starting production (which ramps up each year by early spring so that toys can get onto the shelves by October, the kickoff to the pre-Christmas buying season). "You have to get an early sense of where the market is," says Byrne, who put the tournament set on his 2009 "Most Wanted" list, which has accurately predicted bestsellers for 15 years. "You can have the most wonderful toy in the world, but if retailers aren't going to carry it, you might as well jump off a bridge."

Byrne calls Battle Strikers a perfect "boy" toy. "The 'wow' comes from a classic play pattern," he says. "It's power and conflict and competition."

So far, sales have been solid-not quite Cabbage Patch territory, but Mega is expecting big things. In the end, though, there's just no predicting what the kids will go crazy for. "You can't create a fad," says Byrne. "It's an emotional and cultural phenomenon. It's something that surpasses rational thought."

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3 million / Number of Cabbage Patch Kids sold in 1983 (the most successful toy debut ever)

GLOBAL TOY MARKET

2007 $78.7 billion

2008 $78.1 billion

2009 $75.0 billion