Summer 2008
Kid-sumers: Today’s Super-Spenders

Sales are Growing

How fast is the US children’s market growing? Packaged Facts, a division of MarketResearch.com based in New York City, estimates that the annual buying power of children in the US will grow to $21.4 billion in 2010, up from $18.3 billion in 2005. And that’s just a fraction of the $143 billion parents will spend annually on their children by 2010. Specialty retailers across the country are tapping into the huge-and-growing children’s market by offering a mix of new and traditional products designed to appeal to both youngsters and their parents. Some companies are offering tried-and-true products that grab the attention of kids (and their parents) year after year, while others are introducing fresh new products to the common area in hopes of catching the eye of kid-sumers who want something new-perhaps a product they can design themselves. Here’s the scoop on the latest products making the kids scene in specialty retail.

Personalizing the music

Personalized music CDs that include a child’s name multiple times in a variety of songs are consistent sellers year after year, says Michael Kennedy, director of sales and marketing for Brooksville, FL-based GiggleMedia. The company expects to supply its music-personalization system to about 300 independent cart and kiosk retailers across the US by the winter holiday season.

image“This kind of product seems almost recession-proof,” Kennedy says. “Parents are not as likely to cut back on things that they know give joy to their children… and keep them engaged. And this is not a huge investment.” GiggleMedia CDs, which feature popular licensed characters such as Barney & Friends, The Wiggles and Mickey Mouse, among others, retail for $29.95, which parents aren’t afraid to spend even during tough economic times, Kennedy says.

Start-up as a GiggleMedia independent operator costs $899, which “will generate $1,500 in sales for an instant $600 profit,” Kennedy says. The start-up package includes a USB external hard drive that contains the software (plus documentation) needed to produce the personalized CDs and run demos, a library of more than 10,000 names and songs from seven different CDs, and the CD-copying hardware and supplies to produce and label 50 CDs. Operators plug the hard drive into their own personal computers and they’re ready to produce personalized CDs in just a few minutes. Once they hit 50 burns, they can replenish the system by calling GiggleMedia or order more burns through the company’s website. “Parents love seeing the joy on the faces of their children when they hear the CDs,” Kennedy says. “It’s not like the children hear their names once or twice; they hear their names up to 80 or 90 times on a studio-quality recording as well as having their own name on the CD label-and all this in under five minutes.”

Smarter toys

imageChildren don’t necessarily associate learning with fun. But MindWare, a St. Paul, MN-based wholesaler of strategy games, books and puzzles, has managed to combine fun with education, offering a series of products that are not only enjoyable but teach critical thinking and problem-solving skills.

The company’s strategy has worked well enough so that more than 4,000 retail locations-including inline specialty retailers, zoos, aquariums and museums-sell MindWare products.

“We do brainy toys for kids of all ages,” says Erik Quam, general manager of MindWare. “Our products promote critical thinking and visual thinking. They promote accidental learning. Children are learning when they play our games, but they don’t realize it.”

An example is the company’s popular Rush Hour game, in which children attempt to maneuver colorful plastic cars through a series of increasingly complicated “traffic jams.” Children think they’re merely trying to drive their car home. The game, though, actually teaches children how to think visually and problem solve.

In 2007, the company tested its first cart, opening in Rosedale Center in Roseville, MN, for the winter holiday season. The test was successful and the same location’s scheduled to reopen in October. To make the cart experience a success, every employee who staffed the Rosedale Center cart went through a five-day training process on how to use MindWare’s games and puzzles. This way, the cart staffers were able to demonstrate all the games that they were selling.

“I think the unique nature of our products means that they’re ones that are good to sell from carts,” Quam says. “There’s a specific MindWare customer out there. They understand what our products are about. They get that [MindWare games] are a great way to spend a Sunday evening as a family together.”

The plush rush

imageStuffed animals and plush toys have long been favorites of both children and their parents. It’s little surprise, then, that Little Ferry, NJ-based BearHands & Buddies has seen steady growth as it enters its fifth year in business.

The company’s core line, BearHands, are oversized, warm “bear paw” mittens that have a “secret opening” that lets kids fingers out, so they don’t have to take off their mittens to get a good hold on something with their bare fingers, which has obvious appeal for parents who’ve spent countless hours searching for that missing mitten. The company also sells a line of “buddy” hats, scarves, baseball caps and other branded items that have small plush animals peeking out from under cap bills or perching on scarves, baseball hats and other branded products.

Jeff Golden, president and owner of BearHands & Buddies, expects demand for the company’s products to increase. “These products are unique. They’re cute,” Golden says. “We’re an entire line of products. You can get a mitten, hat and scarf set from us.”

imageRetailers offer the company’s products in more than 500 stores across the country, Golden says. Last year, Bearhands & Buddies sold their products to 12 independent cart operators during the holiday season. Start-up package costs for a cart location are $3,500. That includes about three weeks worth of inventory, signs and information for the media. “Without a crystal ball, it’s hard to say how fast we will continue to grow, but I know we had a good response from the cart operators last year,” Golden says. “Gauging from that response, I think we will be adding more and growing in 2008.”

Design-your-own creativity

Parents are always looking for creative activities to tackle with their children. For Ran Schilo, president of Shanghai, China-based My Design, this is good news.

My Design offers its own Paintable Boots kit for kids (of all ages). The kit, which includes a pair of rubber boots, six waterproof paints, 32 erasing pads, two paint brushes and a mixing palette, allows children to paint their boots with whatever color schemes or designs they can imagine. When they grow tired of their masterpiece, they can erase-yes, erase-the paint and start over with a new design.

imageThe boots, which retail for about $55, are now available from cart-based and traditional retailers in the US and several other countries. Schilo, who invented the product, says kids and parents “enjoy painting their boots. For younger people, they can change their designs depending on the season. They can paint their favorite animal. They can paint fish or roses. Even parents like to paint their own boots.”

My Design Paintable Boots startup kits for independent operators include 300 paintable boot sets, a promotional DVD, signs and product catalogs. As the inventor, Schilo says his product is truly unique. “This is a product that has never been seen before.”

image“People like these because they can be personalized,” he adds. “You can change them, erase them and make new ones.” If there’s anything today’s “what’s next?” consumers love-kids or parents-it’s a product that can become something totally new each day. Another design-your-own unique product is the LauraLi Design-a-Purse created by Laura Elrick, president of Centerville, MA-based LauraLi. She has been selling her Design-a-Purse products for about two years through the Web, traditional retailers and home parties, and only recently turned to the cart and kiosk market to explore opportunities there. Design-A-Purse kits allow children and adults to decorate their own purses by picking their own straps, jewels, colors and trims to create a one-of-a-kind purse. The products appeal to both children and parents who want to express their creativity, Elrick says.

She came up with the idea for Design-a-Purse after her favorite purse broke. Instead of searching for a replacement, Elrick began making a purse of her own, adding jewels, fabric scraps and whatever else she could find. Along the way, she discovered that the process was fun.

“Little by little, I started to create the product,” Elrick says. Now that it’s in stores, she’s had the chance to get a lot of feedback from her customer base, which is very enthusiastic. “Every age group loves this product,” she says. “There’s no cutoff. I’ve seen children as young as four or five putting these together.”

imageCarts are ideal locations for the Design-A-Purse line, she says. Retailers can easily “display them all in their full glory, all their colors or styles together” to create a “magnificent look…. When all the components are visually together, [the display] looks beautiful.” Just the eye-catching type of display that lures kids-and their parents.

Kids rule

As these companies illustrate, there are several affordable entry points into this market available for specialty retailers. From complete start-up packages at less than $1,000 to fresh new wholesale products ready for you to create your own unique cart concept, tapping into the growing kids’ market could be your chance to let kids-and their billions in buying power-rule your register.

Pillow Pets Plush

Another company benefiting from the continued strength of the plush category is CJ Products, based in Oceanside, CA. The company’s My Pillow Pets line features soft children’s pillows that come in the shape of various animals, everything from ladybugs and dogs to turtles and cows.

Jennifer Telfer, vice president of operations for CJ Products and designer of the My Pillow Pets line, says that the company plans to sell My Pillow Pets from about 50 retail locations this year, mostly in malls, including 35 carts (a mix of company-owned and independents). Telfer says her children inspired her to create the My Pillow Pets line. She has several kids, but it was her son who always slept with a favorite stuffed animal as a pillow. “That gave us the concept, [but] we wanted to have something more functional, something more comfortable for him to sleep with,” Telfer says. “We wanted to create a product that was both a functional pillow and a lovable, plush animal. Basically, we wanted to create a pillow with character.”

imageStart-up packages for carts run about $1,900, which includes 312 Pillow Pets in a variety of styles, signs and a promotional DVD. The plush pillows retail for up to $29.95.

Telfer says she expects demand to continue growing for My Pillow Pets. She should know: She’s worked in the cart business with various concepts for 12 years. She says she knows a long-term hit when she sees one. Children drawn to the carts’ colorful animal menagerie become buyers once they get their hands on a Pillow Pet. “We use a high-end chenille fabric,” Telfer says. “It feels like you’re touching a fur coat. It gives children a companion, one that’s so snuggly and comfortable that they can sleep with it…. It becomes their new best friend.”


Fresh Fun for the Feet

Dave Levy describes Polliwalks as toys for feet. Kids agree. Newburyport, MA-based Polliwalks wholesales children’s clogs that are colorful ducks, frogs, gators and ladybugs, with new animals slated for birth in 2008. The critter clogs have proven so alluring to kids that they’re now sold in 1,000 retail locations, a mix of traditional gift stores, zoo gift shops and kids boutiques. Levy, president of the company, says he isn’t surprised by the positive reaction to the unique new product and hopes that there are good things ahead for Polliwalks in the cart and kiosk market.

“When we all saw the designs a year-and-a-half ago on paper, we all knew these were going to be a big thing,” Levy says. “But the shoes did so well when we first rolled them out that we were able to get them in 100 stores. We were really lucky to be able to roll them out before December of last year.”

imageSpecialty retailers hoping to sell the products this holiday season need only buy a first-order minimum of about $375 to get started, Levy says. There are no minimums on reorders. Polliwalks retail for $25.

“We want to be selective about where we sell our products,” Levy says. “We don’t want to be everywhere. But when a right fit happens, absolutely, we’ll consider growing our distribution network. We’re definitely in a growth mode right now.”


Made Ya Look! Five Display Tips that Attract Kids’ Attention

Nancy Tanker

With kids spending more than $18 billion of their own money every year and parents kicking in another $143 billion, selling to kids in a mall, airport, theme park or any other shopping venue isn’t just kids’ play. If you want to lure more pint-sized buyers to your cart, kiosk or inline store, focus on these top five display techniques:

1. Use movement. Like the rest of us, kids’ eyes are attracted involuntarily to movement. A bold prop that continually moves is best, but you don’t have to have a big spinning wheel atop your cart or in your store window to get the job done. You can imply movement in your signage and props by using graphic images such as shooting stars or floating bubbles. The It’s Magic cart shown here uses a wand-and-sparkles graphic to imply movement. The Toodles inline uses a funky typeface and bubbles to get its signage moving, and the Paint ‘N Fun uses a spilled paint blob front-and-center.
image

2. Add color. The color approach you take depends on the specific age group you want to reach. If you want to target infants or toddlers, for example, you might integrate geographic shapes and pastels or bold primary colors that appeal to parents. Check out the Cake and Ice Cream cart that relies on a pastel palette and a few key props to set the “Kids’ stuff sold here!” stage. Or the big splashes of primary colors used throughout the signage and store at Animaland. On the other hand, if you’re selling to tweens, you’ll want to focus more on abstract shapes and bold splashes of offbeat and trendy colors. In general, tweens are drawn to what’s new; babies and toddlers are drawn to what’s familiar.

3. Add great props. Props do two things: attract attention and fill in holes in your display, such as the space above products but under the roofline of a cart. Again, consider the age of the kids you want to reach. The Cake and Ice Cream cart shown here uses large cartoon-like animals to fill space and convey that the cart sells products for babies and toddlers. Carry Me Babies, which targets an older child, uses kid photo cutouts to attract kids’ eyes. (What do kids like to look at the most? Other kids!) Note that the clothing colors in the cutouts match and reinforce the rest of the product display-a nice touch that took either lots of luck or a little advance planning. We suggest you plan ahead.
image

4. Keep it on the down low. Note that on the Carry Me Babies cart, the kid cutouts are strategically placed eye-level to the cart’s kid customers, and products are within easy reach of little hands. The more you encourage customers big and small to touch your products, the better your chance of closing the sale. Also, keep product accessories low and close to the core product they go with, to boost your add-on sales.

5. Light it up. No matter whom you’re selling to, the right lighting can make your products shine. Don’t spend lots of time and attention adding movement and color, only to let poor lighting drag down your display. If your cart or kiosk doesn’t have the lighting you need, talk to your leasing manager about what lighting you can add under the confines of your license agreement.

A great way to get some easy, free color-palette, prop or general display ideas is to go online to a big-brand retailer’s site-one who targets the same age group you want to target-to review the graphic techniques they use to generate interest in their products. The biggest brands have huge marketing departments that spend millions analyzing shopper buying patterns (such as which products tend to get noticed under what circumstances) and spotting emerging trends (such as which colors will be hot with the tween set this Christmastime). You can benefit from the brands’ big-money research-for free.

As a specialty retail entrepreneur, you may not be Toys ‘R Us, but you still have a brand image to convey throughout your store. Create a flow among your display elements by starting with the right color palette for your audience and adding the right props, movement and lighting. Tie the various elements together visually to make your display pop, and don’t forget to position your products within easy reach of little hands. Before you can say, “Abigail needs a brand new toy,” you’ll be well on your way to capturing the most sales possible from the powerful kids demographic.

How Cool is That! Five More Unique Kid Products

R/C Still Flying High

The new Bugcopter Infrared Mini RC Helicopter from Hobbytron takes only 30 minutes to charge and comes with a full-function infrared controller. Users can even fly with their friends using three different frequency bands. Ready to fly right out of the box (batteries not included).

Hobbytron
800.494.1778
Hobbytron.com

Princess Trend Still Pink Hot!

High IntenCity’s Princess Collection includes gem necklaces and this sparkling tiara “with real crystal jewels!” for the ultimate in shimmer, sparkle and shine. The tiara’s packaging, with velvet insert, doubles as a keepsake box, making this a fantastic holiday gift for little girls everywhere.

High IntenCity
201.663.4538
HighIntenCity.com

Make Money With Make-Your-Own Products

Customers love make-your-own products that create an experience beyond unwrapping the gift and give kids a sense of accomplishment. Girls can rock their own individual flower power with funky do-it-yourself belt kits from Mugwaz. Each kit includes suede tong, large and small flowerz, and beadz for stringing. Additional kits feature Mugwaz Bagz make-your-own handbags, Mugwaz Flip Flops, and Party Boxes for up to 10 participants.

Mugwaz
212.871.0019
Mugwaz.com

Dozens of Puzzles

Puzzled wholesales dozens of unique, high-grade 3mm wood puzzles that kids love to put together and paint for a one-of-a-kind creation. Puzzles come individually shrink-wrapped with instructions and sandpaper included. Painted or left as natural wood, kids find these puzzles challenging, educational and fun. Easy to demo!

Puzzled
888.789.3533
PuzzledInc.com

Stocking Stuffers that Rock

These Jingle Bell Backpack Clips mean fun for the holidays! Girly jingle bells and beads make this backpack clip with key ring a perfect stocking stuffer. Available in a 12-piece assortment.

Three Cheers for Girls!
888.333.2260
ThreeCheersFun.com


Article Resources

BearHands & Buddies
201.807.9898
BearHands.net

Design-a-Purse/LauraLi
866.528.7254
Design-A-Purse.net

GiggleMedia/The Charmyn Group
800.306.3552
GiggleMedia.com

MindWare
800.936.6765
MindWare.com

My Design Paintable Boots
646.257.2145
iLoveMyDesign.com

My Pillow Pets/CJ Products
760.757.5347
MyPillowPets.com

Polliwalks
203.712.1315
Polliwalks.com

Additional Resources

3D Games
888.4.3D.GAMES
3DGamesCorp.com

Animaland
866.703.1338
AnimaLand.com

Awesome Specialties International
949.460.9192
AwesomeSpecialties.com

B.Dazzle, Inc.
310.374.3000
B-dazzle.com

Big Belly Banks
603.863.4910
Bigbellybanks.com

BootBops
312.315.4279
BootBop.com

CA Giant
626.307.8927
Anse.us

Cobra Toys
888.668.5444
Cobratoys.com

Designing Diva
606.923.3371
DesigningDiva1.com

Emirmage
877.ULTIMASS
Emirimage.com

Games That Rock/Aleken Games
877.295.2740
GamesThatRock.com

Go! Games, Go! Toys
888.422.5637
CalendarClub.com

Guard-A-Kid
800.679.4256
GuardAKid.com

High IntenCity Corp./Charm-It
201.703.5010
HighIntenCity.com
Charm-It.com

Hobbytron
800.494.1778
Hobbytron.com/wholesale

Initials by Joseph K. & Co.
800.459.9627
InitialsByJosephK.com

Mediak Kids Personalized CDs
800.797.7420
Retail.Mediak.com

Mugwaz
877.468.4929
Mugwaz.com

New Concord Toys
718.441.7018
NewConcordToys.com

Puzzled, Inc.
818.991.9245
PuzzledInc.com

Relaxus
888.668.5444
Relaxus.com/cart

Rhinestone Ruby
212.290.7699
RhinestoneRuby.com

TAT International
800.280.8198
TATstore.com

UJ Trading
800.536.2691
UJtrading.com

Zippy Animal Rides
866.739.3947
ZippyRides.com

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