March 17, 2018
April 2008 | Vol. VII - No. 4
Says "Pressure" on Retailers Was Self-Generated
At Toy Fair 2008, George Kacic, vice president of sales and marketing for Ganz, said he felt TDmonthly Magazine hadn’t covered his company’s point of view about the Webkinz shortage last year. So after the show, TDmonthly gave George a call:
| “They didn't have to buy anything from us to get Webkinz, but we limited the quantity based on what they were buying.” — George Kacic, Ganz
TDmonthly: There were a lot of rumors circulating about what caused last year’s Webkinz shortage. What’s the real story?
George: We weren’t expecting such a huge explosion. Everybody ordered at the same time.Also, we weren’t expecting people to collect them. A child needs just one toy to get on the website.
TDmonthly: Why was Ganz not getting the message through to its retailers that the company was overwhelmed?
George: There was high demand all at one time. Not only orders, but phone calls, emails.
TDmonthly: Couldn’t the company have sent out mass emails to their retailers?
George: We did email blasts to our customers; the problem is that you don't have email addresses from all your customers.
We expected a tidal wave to come in at 20 feet, but it came at 80 feet, so we got buried.
TDmonthly: Retailers complained to TDmonthly that they were being forced to buy unwanted product, such as the everyday line, to get Webkinz.
George: They didn't have to buy anything from us to get Webkinz, but we limited the quantity based on what they were buying. If someone wanted to place an order for 36 pieces, they didn't have to buy anything. But if they wanted 2,000 pieces, we had to create different levels.
We had to rank them by what they were buying. If they wanted something from us and wanted to get higher ranking, there was only one way to get there.
TDmonthly: I attended a meeting of about 50 retailers, many of whom felt pressured by Ganz to buy product, such as a 6-foot witch, that they later had to raffle off or discount heavily to buy Halloween Webkinz.
George: If [retailers] felt pressured, it was only to be the first with the most Webkinz.
A lot of that [complaining about pressure] started on a retailer's website … so we had to put up our own website where you could put up any questions you wanted.
The day it came out that Wal-Mart was going to have Webkinz, everybody [in the chat rooms] said we did it. But we didn’t do it.
TDmonthly: The toys are still in Hallmark and J.C. Penney.
George: I think J.C. Penney is on our website. [Editor’s Note: www.webkinz.com, store locator, Janesville, Wisc.] Hallmark stores are where we do the majority of our business. Webkinz were developed for Hallmark-type stores (i.e., card and gift stores). The first 200 stores where we tested the product in April 2005 were Hallmark stores.
TDmonthly: What about Webkinz being sold in leather stores and gas stations?
George: That was all third party. We don't think we can stop it all, but we stopped a lot of it this year.
TDmonthly: If things are under control, how are you getting that message out to specialty retailers?
George: We have their email addresses now. …We send email blasts to all of them and encourage sales reps to have them go onto our retailer website.
TDmonthly: How do you think toy-store owners feel about Ganz and Webkinz in 2008?
George: The retailers who stayed with us, their sales are up over last year.
The biggest concern they have now is can they get enough? We're limiting what we put out there [because we’re] trying to control the gas stations, 7-Elevens — that kind of reselling of the product.
TDmonthly: How many specialty retailers did you lose during the shortage?
George: We lost the ones we shut down because they were reselling the products.
TDmonthly: Is the number of small stores that carry Webkinz up or down from last year?
George: We’re about the same.
TDmonthly: What about sales?
George: They’re definitely up.
TDmonthly: What can you say that might help regain the trust of retailers who felt burned by Ganz?
George: Retailers told me they never thought they'd see another item as big as [Ty’s] Beanie Babies. They've experienced something twice. It was our first experience. …. We learned a lot in a year and things are going pretty smooth right now. [Editor's Note: Ganz is now promoting a "Webkinz Day Extravaganza," which will allow retailers to give away free Webkinz with minimum purchases on April 25, 26 and 27.]
To find out how to deal with a burning hot toy, read How to Survive a Monster Hit. To learn more about retailers’ frustration during the shortage, read Webkinz Get Sued. To read about one retailer's experience with Ganz's Loyalty Program, visit TDmonthly's Forums.
And here are the Webkinz:
Webkinz Duck by GANZ
This cute little duck comes with a code that allows its owner to access Webkinz World online.
— Over 26 percent of 45 retailers surveyed by TDmonthly in early 2008 named Webkinz as their hottest selling item.
— “Webkinz by Ganz — they still sell out every shipment,” Melodie Ingwersen, owner of Creativity for Kids in Columbia, S.C., told TDmonthly in early 2008.
— “[They] have been really hot for the last couple of years,” she added. 2/18/2008
Webkinz Dalmatian by GANZ
This adorable Webkinz pup is the life of the party, as long as you bring along some of his favorite five-alarm chili from the W Shop. As with the entire Webkinz line, the Dalmatian comes with a special code that allows a child to interact with it on the Web. His "special item" includes the Ganz Rapid Rescue Fire Truck.
— "We just got the relatively new Dalmatian. Their new stuff is great," said Chris Walsh, owner of The Whiz Store in Westborough, Mass., about Ganz. "The demand for Webkinz is going down, supply is up and prices are coming down. Yet, it's still selling quite strongly.”
— Almost 25 percent of the 58 retailers TDmonthly spoke with expect strong holiday sales of Webkinz.
— Although many specialty retailers have complained about how Ganz has handled Webkinz’ sudden popularity, they haven’t quibbled at all about the thousands of dollars these little plush toys have added to their cash registers. The extra publicity the toys have generated hasn’t hurt either, which makes Webkinz a shoo-in for the TDmonthly Top Seller 2007 award. 9/20/2007 (MSRP: $7.75; Age: 3 and Up)
Webkinz Trading Cards by GANZ
Kids can collect, trade and play awesome games with these cards. The first series of Webkinz Trading Cards includes 80 base-set cards featuring favorite Webkinz pets, characters, items and recipes to collect and enjoy. Kids can also collect three exciting subsets of cards: Challenge Cards, Curio Shop Curiosities and Webkinz Doodlez. Each set comes with 10 packs of cards and six cards per pack. Other amounts and booster packs are also available.
— When asked about the current hot-seller in her store, Kate Tanner, owner of Kidstop Toys & Books in Scottsdale, Ariz., said, "Webkinz of all kinds —from the Googles and Chihuahua to the trading card games and booster packs."
— “I would probably have to say any Webkinz by Ganz accessories,” Bill DeFusco, owner of Toyz Toy Store in Chesire, Conn., told TDmonthly, when asked about what he predicted would be his store’s most popular stocking stuffer. “Whatever accessories for Webkinz can be found—lip glosses, body spritz, trading cards.”
—Eleven of 58 retailers who spoke with TDmonthly cited Webkinz accessories as highly popular stocking-stuffer items. 7/27/2007
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