LeapFrog 2010 Annual Report Download - page 17

platforms and stand-alone products, although we use licensed technology if warranted. For example, we
use a version of Macromedia’s Flash player in our Leapster handheld platform. We also use optical
pattern recognition hardware and software from Anoto AB in our Tag reading system.
•Content Development: Our content production department has developed large portions of the content
for our interactive books, educational games, and stand-alone products, applying our proprietary
pedagogical approach, which is based on established educational standards. Much of our content uses
licensed characters, such as the Disney Princesses, Dora the Explorer, Scooby-Doo, SpongeBob and
Thomas the Tank Engine, and characters from the movies Penguins of Madagascar, Toy Story 3,
Tangled, Star Wars: The Clone Wars and Wolverine. We develop most of our concept designs in-house
and most members of our in-house content development and production team have prior experience in
the education, entertainment and educational software or video game industries.
•Development of online web capabilities: Our web-connected products provide accessibility to the
Learning Path, which is a key competitive differentiator. The Learning Path enables parents to track
their children’s learning progress and provides personalized product recommendations. Additionally, the
Learning Path provides children a variety of downloadable content, online rewards programs and access
to an online learning experience. Our online capabilities are developed through a combination of
in-house and third party resources and members of our development and production team have prior
experience in the online engineering and development areas.
Some elements of our product development cycle and most of our game production are performed by third-party
contractors to improve efficiency and control costs.
Advertising and Marketing
Our advertising and marketing strategy is designed to position LeapFrog as a leader in providing engaging,
effective, technology-based learning solutions for children. Our strategy is designed to promote a strong brand
that parents seek out to teach children in a fun and engaging way, with the goal of building their love of learning.
We strive to utilize the best practices in integrated marketing campaigns. In 2009, we shifted our strategy to
leverage more efficient forms of advertisement, such as direct-to-consumer marketing programs via our Learning
Path, with less dependence on traditional marketing programs such as television advertising.
We have well-established retailer relationships and communicate our messages and offers through in-store
advertisements and in local newspapers. Advertisements run by our retail partners, such as Target, Toys “R” Us,
and Wal-Mart, highlight promotional activities and the availability of particular LeapFrog products at these
retailers’ outlets. In key retail stores, we use in-store demonstration display units to highlight LeapFrog products
and demonstrate the features of our products through in-store user experience.
We leverage public relations globally as a strategy to gain additional momentum for our brand and products
through media outreach focused on garnering both product-specific and corporate media coverage. We strive to
utilize best practices in media outreach campaigns that target both traditional print and broadcast media with
Internet/viral media outreach globally.
Distribution
Our customers generally fit into one of the following categories:
•Retailers that resell our products to consumers, through their retail stores and their own online channels,
in the United States and some international regions;
•Distributors that purchase our products for resale to retailers, generally internationally, and also to U.S.
schools and school districts as education market resellers; and
•Direct consumers who purchase our products via our website, www.LeapFrog.com.
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