Mattel Unveils New Elmo, but Will Consumers Be Tickled?

The latest Elmo incarnation was unveiled Thursday -- a new version of last year's hit T.M.X. Elmo that allows kids to induce a case of the hiccups or a laughing fit to the tune of "She's a Maniac."

Fisher-Price, a unit of the world's largest toy maker Mattel , said T.M.X. Elmo eXtra Special Edition would hit U.S. shelves on Nov. 13, relatively late into a holiday season that has so far lacked a dominant toy.

Last year, analysts credited the popularity of T.M.X. Elmo, which debuted in September, with helping get holiday toy shopping started early.

Sean McGowan, a retail analyst with Needham, said the new toy sounds like "a clever idea" and a smart extension to the brand, but said it will not generate as much excitement as did its predecessor.

"It may drive people to buy this particular product, but anything launched at this point forward is not going to drive incremental traffic into stores," McGowan said.

The plush red monster is emblazoned with a gold badge to distinguish him from other versions of the doll.

Since Tickle Me Elmo's 1996 debut, there have been numerous incarnations of the plush doll, including "Knows Your Name Elmo," which could greet children by name.

This year's Elmo, which will retail for about $39.99 and will be available only through the end of the year, includes "hidden silly surprises" that can be unlocked when the consumer plays with him and poses him in a particular sequence.

The special features include a tickle sequence that will cause Elmo to fall to the ground laughing and kicking while singing, "Elmo's ticklish, ticklish, and he's laughing like he's never laughed before."

Fisher-Price said it will post weekly clues on new hidden features on its Web site between Nov. 19 through Dec. 17.

Recalls on Consumers' Minds

Reyne Rice, a toy trend specialist with the Toy Industry Association, said the new version will appeal to parents concerned about recent toy-related concerns due to lead paint.

"One benefit with this toy is that plush is less fraught with issues right now," she said.

Recalls of millions of toys, most involving Chinese-made products with lead paint and many sold by Mattel, have alarmed consumers recently and caused concern among retailers already concerned about constrained spending due to fuel costs and a credit crunch.

About 4.2 million Chinese-made Aqua Dots toys were recalled on Wednesday for possibly containing a chemical compound also found in so-called "date rape" drugs. The toys, which include a chemical on their beads that can cause seizures, was on Wal-Mart Stores' list of top-12 Christmas toys.

The holidays are the most crucial time of year for toy makers and sellers. Nearly 50 percent of all toy sales are rung up in the fourth quarter alone, according to market research firm NPD Group.

Toy industry analyst Chris Byrne said he doesn't expect the new Elmo to become the pop culture phenomenon of last year's T.M.X Elmo but said Elmo is a perennial best seller.

"It's a season when the toy industry needs a couple of laughs," he said.