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Spring 2008 Unique Concepts Spring 2008

Nine Hot Ideas

By combining 3-D scanning with vitrography, Germany-based LOOXIS has created a unique kiosk concept that’s a hit overseas and recently expanded to the US.

Customers vote at the cash register and wins.

Expanding with a mall cart turned out to be a sweet deal for two Canadian business owners.

Retailer David Serata opened a Webkinz cart and temp in-line to make the most sales possible while the toy is still hot, hot, hot.

Two sisters in two countries use seasonal kiosks and in-store demos to build a unique retail and wholesale business.

Nicholas Hurlburt launched his cart with a solid strategy: By selling unusual products he’d have less competition and catch the attention of more shoppers. His approach has paid off.

A kind of headband for the hips, the Hipband is getting around, thanks to a new year-round kiosk.

At Hattitude, if you’re not wearing a hat, you’re not where it’s at.

There might be other massage concepts out there, but Steven Chen’s Oriental Chi reaches a higher level of service to land the sales. His commitment to quality not only attracts customers, but they’re willing to pay a bit more, too.

LOOXIS 3D Portraits Concept Expands to US

Emily Lambert

At more than 50 LOOXIS locations in 18 countries, including about a dozen new to the US, shoppers can have their own 3D Facescan forever immortalized in glass—creating a one-of-a-kind keepsake or gift that takes personalization to a new level.

This specialty retail concept was developed about five years ago by Germany-based LOOXIS, which combined three-dimensional face scanning technology with vitrography, the process of laser-cutting glass from the inside.

Bjoern Lauen, co-owner and co-founder of LOOXIS, explains that a standard 3D Facescan takes less than a second to complete. Once the scan is finished, an employee adjusts the contrast and brightness of the image, then a laser creates the 3-D image inside a glass block.

Getting a 3D Facescan is a unique experience for shoppers, and the process attracts crowds. When passersby see the scan’s striped shadows sweep over someone’s face, they can’t help but stop and take note. In fact, LOOXIS prefers common-area locations to inline stores for the front-and-center visibility. On a kiosk, “traffic is around you, instead of you being around traffic,” Lauen says.

imageA standard-size 3D Portrait glass block measures about 2″w by 3″h by 2″d and retails for approximately $80. Smaller and larger glass blocks are available, as well as special shapes such as hearts for Valentine’s Day. Kiosks stock an average of 10 to 15 different sizes, Lauen says. The LOOXIS system can also create 3D Portraits from two-dimensional images such as photo prints.

The company’s turnkey start-up package for US licensees costs about $130,000, plus the cost of the custom kiosk unit, which varies. “An average location can gain between $350,000 and $400,000″ in sales per year, Lauen says.

He expects US licensees to open an additional 20 to 30 US locations in 2008 and has high hopes for the concept to be a hit with US consumers coast to coast. “A wide range of shoppers are drawn to this new and unique personalization concept and we see a great deal of growth ahead for LOOXIS in the US kiosk market,” Lauen says. “We’re currently looking for knowledgeable, savvy kiosk operators who want to open a unique LOOXIS location of their own in 2008.”

All Politics are National (and Profitable) at Kiosk

Emily Lambert

There’s no doubt that the 2008 presidential race has been a fascinating one for David DeMar. He started off watching the race heat up, then ended up in the thick of it with his own kiosk business. DeMar got into the race—the specialty retail race—after he started searching for a politically themed T-shirt online and realized there weren’t many online retailers—or brick-and-mortar, for that matter—who focused on political merchandise.

Faster than an Iowan can say “caucus,” DeMar hit the trail running, opening a website and a kiosk in the Chandler Fashion Center in Chandler, AZ. With no time to have a kiosk custom-made, he used IKEA cube fixtures to create his own six-foot-square selling area—and overnight became a retail contender.

He opened the kiosk November 1st with a selection of T-shirts and other merchandise relating to all the major presidential candidates at the time. The products, many officially produced by the campaigns themselves, were presented “in a serious way, with no political statement” or bias, says DeMar. As it turns out, though, his customers had something else in mind.

imageRight off the bat, “People came up to me and asked for this slogan or that one” on a T-shirt or mug, says Demar, noting that the slogans his customers had in mind were definitely not the slogans the candidates had on their official T-shirts.

Like any smart retailer, DeMar listened to his customers and adjusted his merchandise mix accordingly. Soon he was stocking outrageous buttons, pithy bumper stickers and humorous T-shirts and mugs that appealed to customers from all political parties. Sales took off.

The new products were “really hit for us,” he says. Another surprise: Despite a political field dominated by men, it soon became apparent that women were DeMar’s best customers. Whether purchasing T-shirts for themselves or gag gifts for friends, women turned out to be major buyers of political products.

T-shirts are DeMar’s best sellers, accounting for more than 50 percent of sales. Popular tees range from those bearing official campaign slogans to those with the type of biting political humor his customers find so appealing. “Sometimes low brow outsells high brow,” says DeMar, who shows his own sense of humor—and marketing savvy—by pricing all of his T-shirts at $20.08.

Of course, DeMar stocks more products online than on his kiosk. features more than 600 pages of merchandise. At the kiosk, promotional materials with the company’s URL are placed in every customer’s bag. The kiosk and website “compliment each other in a lot of ways,” says DeMar.

Because DeMar’s kiosk is so unusual and has such an immediate connection to current events, he’s captured the attention of local media, which has helped boost his kiosk and online sales. He’s been featured in The Arizona Republic newspaper and on local KTAR radio. Specialty leasing managers have noticed, too, approaching him to open additional locations in their centers.

“When you have something unique like this,” he says, “it lends itself to getting attention.” And when it comes to specialty retail, getting attention means landing sales.

Oodles of Strudels Makes Oodles of Sales

Claude Solnik

When Catherine Roncetti made apple strudel for Michael Grosdanoff in his basement a few years ago, he took one bite and knew she was onto something. The taste was enough to convince the longtime butcher to get into the baking business.

“I thought, ‘Wow! Is that ever good! I can make money off of that,’” Grosdanoff recalls. “I’m not a big sweet eater. That’s how I knew it was marketable. I couldn’t stop eating it.”

Roncetti and Grosdanoff are now partners in an Oshawa, Ontario, Canada-based business called Oodles of Strudels. They sell retail year-round from a cart at Oshawa Centre in Oshawa, Ontario, and have booths at the nearby St. Lawrence Farmers Market in Toronto and the St. Jacobs Farmers Market in Waterloo. The mall cart launched in February of 2007, as a way for the company to boost sales during the harsh winter, when shoppers’ trips to the farmers markets decreased from their summer and fall highs.

As soon as the smell of fresh-baked strudel (and breads) started wafting through Oshawa Centre, sales took off. When the peak holiday buying season started, shoppers flocked to the cart and sales went through the roof. “Sales were… Oh my God!” Grosdanoff says. “I just couldn’t believe it.” There was no question that they had found a new market for their product and decided to continue the cart year-round.

imageAlthough strudel typically is made with common fruits such as apples and cherries, Roncetti and Grosdanoff offer their customers the standard flavors plus wild blueberry, apple-cranberry, cherry with cream cheese, brambleberry and poppy seed strudel. “Traditional strudel wouldn’t be made in the varieties I make,” Roncetti says. “I always say I Anglo-fied strudel.”

Oodles of Strudels now has 15 employees (10 full-time) who spend every day baking, packaging, labeling and selling product at breakneck speed. “We hustle,” Grosdanoff says.

In addition to selling through three retail locations, Oodles routinely makes batches of 20 to 50 strudels for a variety of groups, including churches and banquet halls. The company also wholesales to more than 50 retail outlets, including supermarkets. Especially around Christmas and Thanksgiving when strudels sell, well, like hotcakes. “Any product we bake that day is sold out” by closing, Grosdanoff says.

To keep up with the ever-increasing volume, the couple recently purchased additional strudel-making equipment to ensure they’re ready to fill every order that comes their way. In addition to customers, people continually approach them to find out how they can operate an Oodles of Strudels cart in their local mall. That’s led the couple to explore franchising, but no definite plans are in the works right now.

Today they’re focusing on making the best product possible for their customers. “I actually go out and pick the… rhubarb, strawberries and raspberries,” Roncetti says. Eating fresh-picked berries lovingly folded into a fresh-baked strudel “takes me back to my own childhood.”

Apparently there are a lot of hungry shoppers in Canada who want to take that trip with her.

Webkinz Cart, In-line Tap into Toy Craze

Emily Lambert

You know you have a craze when parents act like children,” says retailer David Serata, president of Ruth’s Hallmark, headquartered in Cherry Hill, NJ, speaking of the hottest plush product on the market these days: Webkinz.

Serata runs 13 Hallmark stores in Pennsylvania, New Jersey and Delaware, and he spent much of his summer fielding calls from frantic adults trying to track down the toy whose sales were so strong in 2007 that the manufacturer, Ganz, was sometimes unable to make them fast enough to meet demand. When supplies got tight over the summer, customers began calling Serata daily, sometimes pressing him for details on when he expected the next delivery and at which store, so they could be first in line.

Despite the short supply—in fact, because of it—Serata spotted an opportunity to land the most Webkinz sales possible by opening a few temporary stores featuring the line. Culling inventory from his Hallmark stores, he opened a Webkinz cart in the Philadelphia International Airport’s specialty leasing program last August. Two months later he opened a holiday in-line in the nearby Deptford Mall in Deptford, NJ.

imageKeeping up with the expected holiday demand wasn’t a problem, Serata says. Not only did supplies start to loosen toward the end of the summer, but he hedged his bets, accumulating inventory for months so that he had more than $1 million in Webkinz ready to go on shelves for the winter holidays. Now that supplies are better, the customer calls aren’t so frequent, he says, but his sales are as strong as ever, with some customers scooping up 10 Webkinz at a time.

If you’re not already familiar with Ganz’s plush creations, Webkinz are much more than just plush animals—they’re tickets to an interactive play land online called Webkinz World. Each Webkinz comes with a secret code that, once entered into, allows children to officially adopt their pet, decorate its online room with furniture and toys, buy items such as food and clothing to care for their pet, and play a bevy of safe, privacy-focused online games, solo or with other Webkinz lovers. A big part of the allure for parents, Serata says, is the fact that their kids can play online on a site that protects their kids’ privacy.

Like Beanie Babies before them, new Webkinz friends are constantly being introduced to keep the line fresh and generate new sales. “When newer styles come out, you can sell 60 to 70 pieces of that style in a day,” says Serata. Lil’Kinz, smaller versions of their bigger cousins, also sell well, “but not nearly as well as the larger ones,” says Serata.

And don’t forget the host of children’s products that are part of the Webkinz lineup, including lip gloss, jewelry, body spray, mouse pads and Webkinz trading cards. “One of the more popular things now are the charms,” says Serata.

If Ganz is able to manage supply and continually introduce new Webkinz accessories and children’s products, the franchise has a promising future, Serata says. But if the market gets over-saturated and Webkinz end up being sold everywhere, “It lessens ‘the hunt.’”

For now, though, he only needs to see desperate parents digging through displays in search of the latest Webkinz style their child just has to have, to know the hunt is still on.

The Olive Orchard Blends Quality and Selection

Dan Rafter

Whenever Patricia Hajifotiou visited friends in the Midwest, they would always beg her for some of the olive oils produced where she lived, on the Greek island of Evia.

And why not? The oil produced from the island’s olives is tastier than any found on the shelves of US stores, Hajifotiou says. “The olive oil you can buy here in the United States is of generally poor quality,” she says. On the other hand, Mediterranean olive oils “are of the highest quality,” with rich taste and color.

After friends kept begging her for the Greek oils, Hajifotiou and her sister, Ohio resident Sue Kluchar, realized there might be demand for high-quality oils well beyond their circle of friends. They developed a business strategy drawing on each of their strengths, put their plans into motion and in 2004 celebrated the grand opening of The Olive Orchard, a Chagrin Falls, OH wholesaler of everything olive-from oils and tapenades to olive-derived soaps and lotions to olive-inspired jewelry and artwork.

Kluchar runs the Chagrin Falls headquarters while Hajifotiou operates from Evia, where she’s constantly on the hunt for new oils and olive products from the region.

So far, their dual-country business strategy has worked well. In addition to wholesaling to a number of US gourmet and gift shops-where they routinely set up sampling stations to let customers taste their products and ask questions-they’ve developed a private label line, a variety of corporate gift sets, and built a robust retail business online. Last year, they expanded into retail, opening two kiosks in Ohio malls for the 2007 holiday season.

imageShoppers at both Beachwood Place Mall in Beachwood and Easton Town Center in Columbus were surprised and delighted by the chance to purchase high-quality oils and olive-related products from the Mediterranean, hand selected by the sisters. Customers were “very happy with the products,” Hajifotiou says. In addition to generating sales, the kiosks increased their company’s visibility-which attracted several new wholesale accounts.

Wholesale or retail, the sisters have been rewarded by customers who “really appreciate” their products, Hajifotiou says. The Olive Orchard might be a small, entrepreneurial company run by two sisters, she says, but “we really are a small international company.”

Exquisite Gifts Features the Unusual

Dan Rafter

For shoppers on the hunt for something unique-maybe a miniature pyramid, a life-sized statue of the jackal-headed Egyptian god Anubis, or a hand mirror in the shape of an ankh-Nicholas Hurlburt has what they’re looking for.

Hurlburt opened Exquisite Gifts in March of last year. From a cart in the Queens Center Mall in Elmhurst, NY, Hurlburt sells Egyptian, Greek, Roman and Eastern cultural products-everything from $3 pyramid-shaped key chains to $550 gargoyles.

Hurlburt says his diverse products attract customers of all types, from serious art collectors to fans of kitsch. Plus, he says, the uniqueness of his products has helped him successfully navigate economic ups and downs.

One key is to offer every shopper a product price point within their budget. Acknowledging that only select customers purchase the $550 gargoyles, “everyone can afford a $3 key chain,” he says. “Someone who comes to our cart and likes our statuary may not be able to afford our bigger items, but they can at least purchase a key chain or a hand mirror.”

imageBefore opening his cart, Hurlburt had to decide whether to base his operations from a cart, kiosk or inline. He eventually opted for a cart to keep start-up costs as low as possible, something he considered important for a business that’s unusual enough to be inherently risky at the outset.

The more unusual the product, the higher the chance that shoppers will not embrace it, but Hurlburt felt that carrying items shoppers can’t find anywhere else in the mall is a key selling advantage. The lack of competition shifts the risk factor back in his favor.

Browsing shoppers never fail to notice his eclectic selection, but the fact that his products are culturally significant presents its own challenges. Hurlburt and his staff of four are “selling to customers who want to know about the pieces they’re buying,” Hurlburt says. “If you don’t know about that piece, they’re going to be turned off. If they’re turned off, you won’t see them again. You can easily lose customers by not understanding what you’re selling.”

Overcoming this challenge requires effort. That’s why Hurlburt spends long hours studying the histories of the cultural items he sells-and he encourages his staff to do the same.

Although launching Exquisite Gifts and building the business for nearly a year has proven to be a challenge, it’s one that Hurlburt says has been rewarding financially and personally.

“I really enjoy learning about our products and dealing with the customers,” he says. “When you have customers who are truly interested in what you’re selling, it’s a lot of fun. They can teach you things that you didn’t know. You get a chance to really talk about and learn about our products.”

Hipband Kiosk Helps Inventor Launch New Line

Dan Rafter

As accidents go, Canadian retail entrepreneur Hadija Gabunga’s creation of the Hipband has been a lucrative one. So lucrative, that Gabunga has put her planned law career on hold to become a full-time retailer of what she hopes will one day become the hottest fashion accessory in North America.

The Hipband is a deceptively simple product: a swath of fabric that runs along its wearer’s hips. Think of it like a headband designed for the hips.

The product was the result of a happy accident: Gabunga had a last-minute dinner to attend and, while getting ready, slipped the tube top she was wearing down to her hips. She liked the layered look it created so much that it became the foundation of her new business.

She initially sold her new Hipbands online and at consumer tradeshows and various public events. She already knew that young adults favored the layered look when it came to fashion, and they confirmed as much by snapping up Hipbands at various festivals where Gabunga set up shop.

“I never planned on owning my own business,” she says. “I’m supposed to be in law school right now. But I’m all about things happening for a reason. If this business is meant to be, then it’s meant to be.”

imageAfter a series of successful shows and festivals, she turned to specialty retail as a way to increase her brand’s visibility. Gabunga opened her kiosk last September in Sunridge Mall in Calgary, Alberta.

The kiosk’s goal is “to put the brand out there all the time,” she says. “I didn’t just want to do a show here and there. I wanted an actual location where people could go and see the products. I wanted traffic. A mall gave me that.” Sales there have been strong enough to convince Gabunga to put law school on hold. The kiosk constantly attracts the attention of casual shoppers and gives her the ability to have a retail location with very little overhead. “Not only is the kiosk small [and] less expensive for a newer business to operate, it’s also cute and fun,” she said. “I wanted my location to be something completely different, completely out of the ordinary. Aesthetics were everything. This is something new that I’m selling. I wanted the location to be accessible to everyone.” Gabunga sees this early success as just the beginning for Hipband. She’s already scouting malls in Canada and the United States for future kiosks.

“This is the year for Hipband,” Gabunga says. “This is the year the product really goes somewhere. For someone who makes their own products, displaying them in a kiosk is a great way to help grow name recognition. People walking through the mall see Hipband, and the name sticks with them. I want to get the word out across North America.”

Hats Off to Hattitude!

Claude Solnik

Tourists in Las Vegas aren’t easily impressed. After seeing towering pyramids, a reproduction of New York City and a ship that sinks on cue, how is a retailer expected to attract attention?

Stephen and June Wood, co-owners of Hattitude, have found a way, by wearing-and selling-many hats. They’ve opened two stores on the Vegas strip: a permanent 700 square-foot inline in Planet Hollywood Hotel & Casino, and a second 1,400 square-foot temp inline in The Grand Canal Shoppes at The Venetian Resort Hotel & Casino.

While boats drift by in The Venetian’s canal, customers in Hattitude stores enter a world honeycombed with hats in just about every color. There they can don trilby (the style Justin Timberlake often wears), outback, derby or bowler, gambler or a multitude of western-style hats.

“We have hundreds and hundreds of styles,” Stephen Wood says. “You feel, ‘This is amazing! I have to get one, because I’m never going to see this again.’”

If you’re a Vegas tourist worried about what will happen should you need to pack your hat for the trip home, Hattitude has the answer. The company has its own brand, including hats that fit nicely into-and emerge unscathed from-tightly packed luggage.

Hattitude’s house brand has boosted profit margins, Stephen says. “It’s less expensive, and we’ve been moving such an enormous amount of product-so it’s been worth it.”

imageHats in the Planet Hollywood store typically go for $30 to $40; those in the Venetian can sell for $150 or more. The Venetian store has “items you won’t find in other stores,” Wood says. “We searched different parts of the world to find them.”

“I always liked hats, since I was a kid” in London, Wood says. “My grandfather always wore a hat. He always used to say, ‘If you’re not wearing a hat, you’re not dressed properly.’”
Hattitude will let you dress properly-or whimsically, if you’d like. Birthday hats that look like you’re wearing a birthday cake are attention grabbers. Or you can walk out with a hat that looks like a flamingo perched on your head.

Tourists from around the world tell the Woods they heard about the shop abroad and wanted see what it was all about. He’s attracted customers from as far away as Switzerland and Japan. Those customers will return home, Wood says, and someone will ask, “Where’d you get that hat?” and his store will be the topic of conversation once again.

Wood says his grandfather (who wore a trilby before Justin Timberlake was born) would be thrilled with the Hattitude stores. “I think he’d be very proud,” Wood says. “He would always have a hat to wear, for sure. He’d probably want to work here.”

Oriental Chi: The Quality Massage Concept

Bernadette Starzee

Steven Chen believes that his company, Oriental Chi, is the best specialty retail massage concept out there. But that’s not enough for Chen, whose goals include making Oriental Chi a household name-one associated with quality.

“What sets this concept apart is Chen’s focus on detail,” says Mark Klockner, president of Retail Infusion in Delray Beach, FL, whom Oriental Chi has retained to help it expand. “He truly wants to be the best.”

After offering massage services part-time for several years at a small Massachusetts mall and at numerous fairs, Chen decided to quit his job in the pharmaceutical industry, where he had worked for about 15 years, to concentrate on Oriental Chi full time. In 2003, he opened his first kiosk in the Foothills Mall in Tucson, AZ, where his business is now headquartered. Oriental Chi has since moved into an inline store in the mall and opened another 11 locations, a combination of inline stores and kiosks in 10 malls in Arizona, Colorado and southern California.

Excellence in customer service is Oriental Chi’s chief goal, Chen explains. “I can’t put enough emphasis on providing the best service,” he says. “It’s the most important thing.” Customers who are not completely satisfied are offered a 100-percent refund. “I make it clear to all my managers,” he says. “We’re here for the long run. We’re not short-sighted.”

Oriental Chi specializes in acupressure, Meridian and trigger point massage techniques. The approach is “different from Swedish massage” and different than any other massage-concept specialty retailer, “Our massage rebalances and rejuvenates the body,” he says. “People go back to their daily lives and then revisit us when stress and stiffness build up again.” One important distinction for the common area customer: They need not disrobe. “A loose T-shirt is fine,” Chen says.

imageMark Klockner, who’s seen his share of massage concepts over nearly 30 years in the mall management industry, says, “Oriental Chi is taking a totally different and totally focused approach to the massage category-creating the ambiance of a spa in the common area.” For example, in the inline stores and kiosks, a soothing waterfall and soft music combine with Asian-influenced fixtures and display accents to convey sophistication and tranquility. As in any spa, various massage-therapy products such as essential oils and lotions are available, and Oriental Chi’s prices are very reasonable. Essential oils, for example, range from $5 to $20 retail.

Prices for a massage are $8 for five minutes, $12 for 10 minutes, $55 for one hour and $75 for 1.5 hours. The one-hour massage is his most-popular service, Chen says, adding that his customers don’t mind paying a bit more for an Oriental Chi massage. “Our prices are a little higher than other companies who might offer 15 minutes for $12,” he says. “But for $12, we give a quality 10 minutes.”

In the future, he plans to offer private-label massage-therapy products, launch a website to attract more customers and open additional inline stores and kiosks in major metropolitan markets such as Dallas, Houston and New York City.

He’s also considering franchising, but doesn’t want to compromise on the level of excellence he’s been able to achieve. “I would have to find [franchisees]… who are committed to quality,” he says.

Emily Lambert

Lambert, a senior writer for SRR, resides in Philadelphia. She can be reached at .

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