Well, I think it's possible that they just didn't put out enough "flashy" and updated product for the young generation. I know sales were dismal before they were bought. Think about it, who is buying 3rd edition and d20 right now? Also, they didn't quite make their products as interdependent as Wizards of the Boast does.

The first post is the rise and fall in the 80's...



Here is the view from Ryan Dancey, VP of WotC (at that time) concerning the buy-out of TSR in 1997:



Manga

Dranoel,



that was exactly what I was looking for. Thanks for sharing with us the insights of Ryan Dancey, one of the few who should know what really happened.



Great description of fear and loathing in Lake Geneva!

Ralf,



Glad that info was able to shine a little insight into your question. There are a few other postings in the archive section that give you a glimpse inside the gaming industry as well.

Ralf Toth wrote: Ciro, this is a fantastic interview you had with Gary Gygax. It explains everything (from Gary's view) until after Lorraine Williams took over TSR. Very interesting insight indeed, especially the mechanics behind the Blume take-over (though Gary obviously didn't want to or didn't have the power to object the buying of Don Kaye's shares by Blumes father). Unbelievable is the mismanagement by the Blumes. It seems as if they have made nearly every mistake they could have done. Now it becomes clear how Lorraine Williams was able to take over TSR. A lot of dirty laundry comes to light ...



If we add Ryan Dancey's information about the looming death situation in 1997 and the reasons for it it forms a nice picture of the decline of TSR in the nineties. Though I am still not completely satisfied. The reason is the time gap of 8 years between the release of 2E and the financial death of TSR in 1997.



Gary Gygax states that approx. 50 % of the audience was lost with the release of 2E. I still doubt that figure heavily, but of course, I am a complete outsider concerning such questions. In 1989, the year of the release of 2E, TSR had two very successful gaming lines with Forgotten Realms and Dragonlance. They produced some (financial) flops with their campaign worlds, with Spelljammer and Al-Qadim being the obvious ones (probably also Ravenloft), but Dark Sun and Planescape were successful examples. TSR released hundreds of 2E products in the years following 1989. I read elsewhere that they only made money with the hardcover items which fits nicely with Ryan Dancey's description of products which costs exceeded the price the company was receiving for selling them.



Still, 8 years is an awful long time. Is it possible to produce only mistakes and keep a company alive and growing for such a long time? Sure, Lorraine Williams made many mistakes and she was as bad for TSR as the Blumes in the 80s, but was it really all black? Wasn't there also some success stories in the 90s?



The pictured formed out of the mists is becoming clearer and clearer. I'd appreciate it muchly if someone was able to shed some more light on the period between 1987 and 1997, especially the release of 2E and financial success and failures of the various campaign worlds.

Here are my two eurocents. Now that I am a retailer from 1997, I can see things much more clearly than the past. First, if there was a major mistake TSR did, it was killing D&D and focusing on AD&D. Perhaps D&D didn't fare too well financially, but it was the best instrument to bring in new customers attracted by its simplicity and the boxed format (a big selling point for newcomers that would be 'shocked and awed' by three big rulebooks ). I think that TSR's Dragon Lady choose to focus on AD&D because she believed there was a core audience TSR needed to chase and keeping interested, if only because the game was at the strongest in the hobby market. When TSR realized this huge mistake started to release new D&D boxed intro games, but it was too little too late (albet I was told that in Italy the Big Black Box sold very well, after that there was nothing to entice newcomers so the effort virtualy went nowhere unless you was willing to buy a mammoth book of 300+ pages!). In the mass market only D&D got significant penetration and its popularity and interest for buyers of big chains was starting to fade away in '90s. Hobby market usually is safe and predictable (to a point as the success of Magic and Mage Knight proves), while the mass market is quite unstable and exposed to an extreme competition, requiring big bocks just for promoting your products. In the hobby market TSR was THE company, in thr mass market just another middle siezed vendor...  



In Europe D&D had always big audiences and I am amazed to see such a short sighted business strategy regarding such an important market like our continent.



Second: I share your opinion that TSR had its success stories. AD&D 2nd Edition was itself a success story, despite Gary's words. It was the first ever AD&D edition translated into Italian and in hobby stores sold well, really well at the time. A problem: most of buyers were D&D fans wishing to 'update' their games and when the supply    of willing fans started to dwindle the game and RPGs in general suffered harsh consequences. In the US I suppose that gamers were eager to have some better organized manuals than the 13 books needed. Anyway, it sold a lot of copies (250,000 copies it seems). I'm sure the main problem of TSR was producing too many campaign settings, settings that started to compete with each other for the same customers base. The possible idea that a fan would have bought everything for a setting then, fed up, starting buying books for another setting was wrong. If I'm tired of AD&D, perhaps I'll try another RPG, not a variant of the same. But die hard fans of campaign settings I'm sure were quite upset in seeing this flood of books with highs and lows of quality. It seems that for some time TSR's strategy was simply to flood stores' shelves crowding out competitors - a high risk and high cost strategy if your products didn't sell well.



Third. I am pretty sure the only true money making settings for TSR were Forgotten Realms and DragonLance (with the big push of the novels). The other ones were loss making or no profit lines. I'm saying this for the simple reason that when Third Edition was launched only the Forgotten Realms were published by WotC. Ravenloft was produced by a White Wolf imprint (with lower expectations for sales and a black and white format), DragonLance was 'farmed' to Sovereign press for the core rulebook (published anyway by Hasbro itself) and licensed to the same publisher for other products. This I suppose can be explained with the fact that some very well known authors of DragonLance books are Sovereign Press' owners and this perhaps gave them some real clout in discussing with Hasbro. The other lines so far haven't been resurrected by anybody, Planescape too. This is because I'm sure publishers aren't at all convinced about their sales potential and this really means something.



Last, the concept that just hardback books have the capability to generate profits. I disagree strongly with this. It's a true fact the sales of everything are lower (sometimes far lower) than the main book(s). Such books are priced in a way that reflects this reality however (for example, the Monster Manuale had a price of 24,95 euros here, the far thinner and not hardback Monsters of Faerun 22,00 euros!). More, an 'optional' book can have really good sales - for example, Third Edition campaign Return to the Temple of Elemental Evil has a really strong success story here. The fact it costs 24,95 euros in Italy doesn't bother at all customers, especially when they compare the price to the 9,95 euros, 32 pages adventures... The splat books for the classes are strong sellers too and I'm sure the Italian publisher makes a good profit out of them (and Hasbro too): the accusations to these books to be 'useless' are perhaps true, but in sales terms absolutely insignificant.



Well, perhaps my eurocents went a little   overboard

Ralf Toth wrote:

LOL!

Uh? What is the meaning of LOL?