Why so many people believed their Beanie Babies would be worth a fortune

An 18-wheeler packed full of Beanie Babies spilled the plush toys onto Interstate 285 during rush hour. It was the height of Beanie Baby mania, in June 1999. Motorists “risked life and limb” to secure handfuls of the precious toys, per an account in Journal Times. Several drivers were seen hanging out of car windows with one hand on the road scooping up Beanie Babies while the other precariously steered the wheel.

The toy was created for children. But it made adults go mad.

That same year, a judge ordered a divorced couple who couldn’t agree on how to divide their massive Beanie Baby collection to split the babies up one by one in a courtroom, per The Los Angeles Times.

“Beanie Babies were originally intended as fun playthings for children, but as the old saying goes, ‘Whenever you have something intended as innocent fun for children, you can count on adults to turn it into an obsessive, grotesquely over-commercialized ‘hobby’ with the same whimsy content as the Bataan Death March,’” humorist Dave Barry wrote in a 1998 column, as cited by Zac Bissonnette in “The Great Beanie Baby Bubble,” per WBUR.

My parents bought me one. It’s decked out in blue and red stars and has an American flag embroidered on its synthetic plush chest. They stored it in a zip-close bag in the depths of our basement for roughly two decades before presenting the long-lost gift to me.

“Dad and I got this for you when you were a baby,” my mom told me as she handed the compressed stuffed toy to me.

“We thought it would be valuable one day and you could sell it.”

How Ty Warner created a Beanie Baby obsession

I don’t have a trust fund. But I have a Beanie Baby. You can buy the same one on eBay today for roughly $25 (it’s part of a two-pack). It typically lives in the depths of my closet, but around the Fourth of July, I like to display it on my nightstand. And who knows? Maybe one day it will be worth something.

Hundreds of thousands of people believed their Beanie Babies would be worth a fortune. And that made Ty Warner, the founder of Beanie Babies, a billionaire.

Through unconventional business tactics, such as refusing to sell his products to Toys “R” Us or Walmart, limiting Beanie availability and giving each plush toy a name and birthday — so they seemed like real pets, per Insider — Warner had the world convinced that his stuffed animals would one day be worth more than gold. A recent Apple TV+ release, “The Beanie Bubble,” unpacks the stuffed-animal craze that made people go bonkers.

As seen in “The Beanie Bubble,” which is rated R for language, Warner sold the plush animals for just $5 a piece.

“At that time, there wasn’t anything in the $5 range that I wouldn’t consider real garbage,” Warner said, according to Chicago Magazine.

The inexpensive toys were under-stuffed with tiny PVC pellets because Warner believed it made them look and feel more realistic, per Chicago Magazine. But it wasn’t just the cute beanie names (ex. Bubbles, Cottonball), the low price or their lifelike movement that made the toys wildly popular. Warner manipulated supply and demand to create an obsession with Beanie Babies.

Warner only sold small batches of the toys to independent businesses. He refused to supply large quantities of Beanies to big-box retailers, which made the toys come off as a novelty, per Slate. Also, he “retired” each toy soon after introducing it, replacing it with a new character, so collectors would rush to buy each new release before it suddenly disappeared.

“At the height, they were shipping more than 15,000 orders per day to retailers,” Bissonnette wrote in “The Great Beanie Baby Bubble,” per Chicago Magazine. “It just never seemed as ubiquitous, because he was limiting each store to 36 of a style. That’s actually why they were able to work as a collectible: People just had no idea how many of them he was shipping.”

The toys’ presumed scarcity made room for a resale market on eBay — which further fueled the frenzy. After just weeks, the $5 toys could be resold to collectors for thousands.

During the toy fad’s peak, Beanie Babies accounted for 10% of all eBay sales, reports Fortune. “On eBay, Beanie Babies sold for an average of 30 dollars — six times the price they had originally retailed for. Within a few weeks, #1 Bears would be selling for $5,000 or more apiece,” according to “The Great Beanie Baby Bubble,” per WBUR.

The Beanie Baby empire comes crashing down

Economists David Tuckett and Richard Taffler have theorized that people sometimes view new, exciting creations as “phantastic objects,” and become convinced that obtaining them will provide a profound satisfaction, per Slate.

But even experts cannot entirely explain what caused Beanie Baby mania — or why grown-ups believed their Beanie collections would one day become mega-valuable.

It made Warner a billionaire and Ty Inc. the first $1 billion plush toy company, per Fortune. But, like any fad, the Beanie empire eventually came crashing down. The toys no longer held value, and collectors gave up.

The Beanie Baby bubble crashed suddenly. In September 1999, Warner announced that the end of Beanies was quickly approaching.

“VERY IMPORTANT NOTICE: On December 31, 1999-11:59 p.m. (CST) All Beanies will be retired,” the company revealed in a press release, per History.

Collectors worried about how this would impact the value of their Beanie collections, but just a few months later, Ty Inc. retracted their announcement and said that instead of discontinuing Beanies, they would release a line to celebrate the new millennium, starting with a star-spangled bear called “The Beginning.”

Fans felt betrayed by Warner’s publicity stunt and sales plummeted, per History. Within a few years, the toy’s novelty had worn off and there were too many of each Beanie for them to retain value.

“There were just too many of them,” says Beanies expert Leon Schlossberg, per Chicago Magazine. “He oversold the market.”