At the time I was still working part-time selling trains at a local hobby shop. The true hobbyist customers knew M-T-H, their quality, and especially their smoke units. In spite of this, more than half of them remained loyal to Lionel because Lionel was "their hobby".
Everyone else who came in knew only Lionel, American Flyer, and perhaps Tyco from the 70's.
From a pure marketing standpoint, the Lionel name still outweighed the M-T-H quality and innovation. I predicted at the time that if Lionel ever got their act together, all things being equal, the blue and orange box would always outsell the purple. It was just that ingrained in people's minds from their childhood.
When I spoke with customers, they would speak of M-T-H trains in terms of detail, smoke, prototypical fidelity. But when they spoke of Lionel trains, it was always in emotional terms... smells, rumbles, the joy of the little man in the milk car, dad, grand dad, falling asleep under the tree with the train whizzing by... very difficult for a new brand to capture that.
Jon 
