PLEASANT CO. HOW TO COMPETE WITH A CHAMP
By Brian Dumaine

(FORTUNE Magazine) – SAMANTHA PARKINGTON fights for women's suffrage. Addy Walker escapes from slavery. Kirsten Larson builds a life on the frontier. Characters from a feminist novel? No, these plucky heroines are part of the American Girls Collection, a mail-order line of historical dolls that are the darlings of 7- to 12-year-olds. Christmas orders piled up so fast at Pleasant Co. -- the privately held dollmaker in Middleton, Wisconsin -- that vice presidents had to pack boxes in the warehouse. Sales will exceed $100 million in 1993, 40% more than in 1992. But Pleasant Co.'s boom is not merely a tale of one company's success. It is also about how to prosper by setting yourself apart from competitors -- in this case, Mattel's Barbie, a $1-billion-a-year baby. Pleasant Co.'s strategy holds lessons for anyone looking to launch a new business or revitalize an old one. President Pleasant Rowland, who began the company eight years ago with royalties she received from writing primary school reading books, knew her vision had to be broad. Simply launching a me-too doll would have meant failure. Rowland, 52, decided to give young girls anti-Barbies, dolls that could teach American history, family values, and self reliance. Says she: ''We're in the little-girl business, not the doll business. We want to have a positive impact on their lives.'' Rowland got her idea after she went shopping for dolls for her two nieces. All she found were Barbies that wore spiked heels, drove pink Corvettes, and looked as if they belonged in strip joints. Though industry sources told her she couldn't sell a mass-market doll for over $40 -- some Barbies cost less than $10 -- Rowland gambled that boomer parents would pay more for one that was fun and educational. Each of Pleasant Co.'s five dolls represents an era of American history. Addy is from the Civil War, and Samantha is described as a ''bright Victorian beauty.'' Parents can also buy historically accurate replicas of clothes, furniture, and memorabilia, such as the June 6, 1944, Chicago Daily Tribune headlined ALLIES INVADE FRANCE, made for Molly McIntire, the 1940s doll. The 18-inch dolls cost $82; add in all the accessories, including $80 dresses for the doll's owner, and the price exceeds $1,000. Every doll also stars in its own series of novels, with titles like Kirsten Learns a Lesson and Samantha Saves the Day. The heroines go on adventures and cope with moral dilemmas; for example, Felicity Merriman, a colonial girl, has to decide whether to continue her tea parties while her father fights King George III's tea tax. Says Rowland: ''We try to give girls chocolate cake with vitamins.'' Pleasant Co. decided early not to compete doll-to-doll on toy-store shelves. Defying industry wisdom, Rowland began selling only through her own catalogue. She counted on her dolls' being so different that word of mouth would take care of sales. She also coddled her customers. Pleasant Co. opened a ''hospital'' for broken dolls, so that when brother sticks a pair of scissors through Molly's head, Mom can return her to Pleasant Co. for repairs. For $35 the company does the surgery, then mails Molly -- now wearing a hospital gown and carrying a certificate of health from the house doctor -- home to recuperate. Will Pleasant Co.'s dolls have legs? Rowland says movies, CD-ROMs, and theme parks aren't out of the question. But she'll expand only as long as she can keep the business special. She refuses to license her products on T-shirts and lunch boxes, fearing that too much exposure would cheapen the dolls' image. Says Rowland: ''It never hurts to play hard to get.''