Hooked on a New 'Phonics' Product

Remember "Hooked on Phonics"?

Actually, who could forget?

A few years back, you'd hear the company's farfetched claims of success--"I read a 120-page book after using one tape"--every time you turned on the radio. In 1995, however, the ads were silenced when the Orange-based company went belly-up.

Bankruptcy, though, didn't alter the value of the name. Tens of millions of advertising dollars had created a public awareness that, as with Kleenex or Xerox, transcended the product itself. The name "Hooked on Phonics" was recognizable by 90% of Americans, according to a marketing survey.

Enter Chip Adams, a Bay Area venture capitalist whose Rosewood Capital fund had given a boost to such consumer favorites as Noah's Bagels and Jamba Juice. Adams and his wife, Thayer, had four children and they'd been among the million or so buyers who'd been "hooked" by the phonics kit's ubiquitous ads.

They considered the kit's taped drills--letter sounds chanted to rhythmic elevator music--to be the equivalent of teaching a kid to field grounders in baseball or dribble left-handed. They weren't a substitute for "the game of reading," as Adams calls it. But they were valuable nonetheless. Especially if they were supplemented with books chosen to help reinforce the newly mastered skills.

So, convinced he could improve on the kit while capitalizing on its well-known name, and convinced too that there was a large market for "Hooked on Phonics," Adams decided to buy the company.

First he needed investors. Among those signed up to help Rosewood Capital were the Ford and Rockefeller foundations, the Fisher family (founders of the Gap stores) and USC, the standard-bearer of the entrepreneurial spirit among universities.

Two years--and $4 million to $5 million in development costs later--the company now has relaunched the product. The 10 tapes, five workbooks, 30 paperback stories, wall chart, stickers and other doodads are packaged in six brightly colored boxes. The tapes still feature the say-along drills--"A," "Ah," "Apple"; "B," "Buh," "Bell"--chanted by the same cloying cheerleader-like voice. But now the kit also has original stories by children's authors such as Charlotte Zolotow and David McPhail, all illustrated.