Why is my character in the Mecanim Follow Example scene floating?

Hi all!

I don't seem to be picking up Mecanim too easily. I've watched a lot of the tutorials that are about and get on ok with the stock characters that they reference but when trying to use the Follow example scene with a custom character, it jumps much higher than the ground as pictured. Excuse the basic box man character :P The stock animations and behaviour used with the Teddies work fine except for the character being off the ground.

From what I've read it has something to do with the Root Motion which is currently set to "Handled By Script" as with the Teddies. If I change the "Root Transform Position (Y)" it doesn't seem to do anything but I would have thought that even if it did that it would affect the Teddies also?

It's probably something really simple but I seem to be having a hard time of grasping it.

Thanks