Click here to see the February 2005 TDmonthly Magazine coverage on the battle with Wal-Mart.
Is less more when it comes to toy prices?
Holiday shopping seasons have seen the growing trend of consumers turning to stores like Wal-Mart and Target to make toy purchases, due in large part to lower prices. But that doesn’t mean toy stores can’t bounce back. After all, selling toys is their business.
Retailers need to stay at the top of their game and appeal to customers with creative strategies other than offering the lowest price. The following tips will help retailers show customers how shopping with them will offer the greater benefit.
Don’t lower prices. Toy retailers have an anxious eye on their sales after Wal-Mart became last year’s winner in the holiday price break category. Even though USA Today names Wal-Mart as “the number 1 seller of toys and the industry’s price leader,” that doesn’t mean specialty retailers have to lower their prices. Instead, retailers show confidence in the product and that they believe in the loyalty of their customers by keeping prices steady.
Stephen Arnold, general manager of OnlyToys.com said, “We don’t adjust pricing, but in fact some of our specialty competitors actually raise their prices during the last quarter as they believe their regular customers have already purchased and these new customers are willing to spend whatever it takes to get the specific merchandise they desire.”
Show customers the value of your merchandise. According to a survey done for The Discovery Channel Store, creativity, imagination, and education were valued most by parents when shopping for toys -- attributes they felt were not at the forefront of the toy selection today. Offering a better selection of educational toys will likely attract more parents, according to the survey. Scott Eichler, vice president of Product Development for Discovery Channel Stores, said, “We believe it is possible to satisfy both parents’ demand for enriching toys and kids’ desire for fun.”
Stock original items. As important as it is to have items for the everyday toy consumer, it is just as important to appeal to serious toy buyers by carving out a niche. “Our clientele is looking for unique, traditional toys,” said Richard Ross, owner of Silly Goose, Inc. “Our motto is, no video games and no batteries. We find our clientele shies away from the discount-type stores.”
Offer online services. According to a survey conducted by NPD Funworld, 41percent of shoppers polled plan to buy holiday gifts online, proving that convenience is a big decision-maker during the holidays. If a store is hard to get to or in a high traffic area, people will want other options. Making sure a store is Internet friendly, the Web site is easy to navigate and updated at least once per week can make a huge difference.
Ross said Silly Goose, Inc. has been online for four years and the store is averaging 30,000 hits per day. “We buy a lot of keywords, and I think search engines recognize we’re a real business, and that helps,” he said. “A lot of it is word of mouth from our customers. If you have a good site, word will get around.” Ross finds that opening up to feedback is very important as well. “That’s been helpful because we listen to what the customer wants to make their shopping experience easier,” he said.