More and more toy sales are happening online, and as a result, the way many toy companies launch new product is changing.
As Alan Dorfman, President of Super Impulse pointed out, “Manufacturers do not have to be committed to retail buying windows for new products,” in brick-and-mortar stores.
And for Blip Toys, though increasing numbers of toy sales on websites like Amazon has not affected shipment schedules with brick-and-mortar, “Amazon has, however, offered a more flexible avenue of revenue where we as the vendor are able to schedule our own timelines,” said Jenna Harlander, director of brands and marketing.
There are numerous advantages to toy companies when it comes to selling online. Dorfman noted that companies can launch “‘as ready’ and get a read on sales, track reviews, experiment with advertising [and] promotional spends.”
“A good early read provides a good indicator as to how much inventory to commit to, or not, for later in the year,” Dorfman said.
Matt Nuccio, president of Design Edge, observed that his clients are starting to put more focus on online sales and less onto brick-and-mortar. Like Dorfman, Nuccio said that selling online helps equip companies with useful information.
“Selling online allows the toy manufacturer to more easily test products and receive precise data on demographics enabling them to tweak and perfect products with each new inventory batch. And, with no absolute launch and cutoff dates they can be as aggressive or conservative in their approach as they deem necessary for the launch of their product,” Nuccio said.
According to Steve Totzke, Chief Commercial Officer for Mattel, pre-selling products online is more effective than pre-selling in-store, “and enables us to gauge consumer interest prior to a launch.”
For example, when Mattel secured a license to manufacture plush Star Wars “The Child” dolls –popularly known as “Baby Yoda” from the Disney+ series, The Mandalorian — the company launched a pre-sale with its retail partners.
“The response was tremendous,” Totzke said. “The pre-sale helped inform our production schedule.”
Still, for many toy industry executives, brick-and-mortar retailers remain a key part of releasing new toys.
Eric Nyman, Chief Consumer Officer for Hasbro, said that “in-store shopping experiences are still a valuable component for many customers.”
Nyman continued that the company employs an omni-channel strategy, “which includes a mix of support for both online retailers and brick-and-mortar stores in its overall retail strategy to ultimately create a varied shopping experience, reaching the consumer where and when they are seeking to make a purchase.”
Similarly, Annie Laurie Zomermaand, Chief Commercial Officer of Schleich USA, said that brick-and-mortar retail remains a top priority for the company.
“We have clear data to indicate that while there is significant sales potential online, our consumers resonate deeply with the intimate experiences they have with Schleich at the shelf,” she said.
YULU Toys co-founder Jochem van Rijn said that having a strong online presence can contribute to a successful in-store launch.
“We know that consumers don’t shop exclusively online or in-stores, so all channels must be aligned to run effective marketing campaigns,” Van Rijn stated.
And in marketing a product leading up to a launch, social media has become an important component.
“A decade ago, New York Toy Fair was the place to launch your product,” Nuccio explained. “The media would be there interviewing and filming.”
And while Toy Fair is still a big part of generating publicity around a product, Nuccio said his clients are now seeking out partnerships with social influencers and online retailers, “creating a buzz weeks, if not months, before they walk into the Javits Center.”
Nyman said that Hasbro recently found success incorporating social influencers into the 2019 launch of its Nerf Ultra, with the first-ever Ultra Championship.
“Not only were we able to engage their fans directly via content on each creator’s channels with a swipe up to buy message, we also captured content to be used across marketing sizzles, product testimonials, retailer videos, and more to amplify the engagement,” he said.
With social media, Dorfman said toy companies can generate awareness about a product “and not have to wait and hope that people find it on the shelf.”
“We can generate consumer awareness of a product as it is hitting the shelves, position the product as we want to position it with information, context, and instructions,” he said.
There are ways that brick-and-mortar retailers can keep up with the transition to launching products online. Dorfman said that “the best situation is when retailers can do both online and brick-and-mortar retailing.”
Likewise, Totzke explained that most large global retailers are omnichannel. “The growth of buy online, pick up in store across the industry is a great example of this.”
Totzke has found that although many global retailers still have “set” dates and timelines, “most have become more flexible over the past several years on how they stock and promote toys,” he said.
“This flexibility gives us room to respond to consumer demand,” Totzke added. “I have also found that – the hotter the toy, the more flexibility there is.”
Across the board, toy companies emphasized that a crucial part of brick-and-mortar stores’ ability to compete with online shopping lies in their ability to create a unique in-store experience for shoppers. These experiences are ones that “can’t be found online,” Totzke said.
Zomermaand has also observed a trend in retailers striving to provide shoppers with unique experiences.
“We know that retailers are looking to provide more immersive, entertaining experiences for their customers,” she said. Zomermaand listed “waterfalls, interactive digital media experiences, larger-than-life animals, [and] play spaces” among the in-store features that consumers can find at Schleich’s retail partners like Toys’R’Us, Fao Schwarz, and Mall of America.
Nyman also acknowledged retailers adapting to the online shopping shift “by altering the in-store experience to make obtaining and purchasing product more interesting and effective for shoppers.”
Meanwhile, Nyman said that internet retailers with no physical stores have also begun identifying ways to combine online and in-store shopping experiences.
“Online ‘pure-play’ retailers are looking for engaging ways to extend their online presence to brick and mortar stores or pop-up experiences in order to make that face-to-face or product-in-hand connection with consumers,” he said.