Finding the Baby Niche

Although a number of retailers are expanding their offerings to encompass more SKUs in both toys and juvenile, major stores appear to be maintaining separate sections for both categories. Don Rice and Dan Blau of SoftPlay, Chicago, feel this approach works well for the educated customer. Consumers have “a good idea of what they are looking for when it comes to these categories, and the distinction of the two benefits them,” they say.

In fact, industry insiders believe it's critical that retailers keep these sections distinct and not blur the lines between toy and juvenile.

“Juvenile products and toys are very different businesses and need to be addressed that way,” says Ellen Portantino of Baby Einstein, Glendale, Calif. “Consumers shop for infant products and toys at different times and the right products need to be in the appropriate aisle. ”

Retail management consultant George Whalin cautions, “It may seem like a logical thing to marry the two categories, but I don't believe such a move best serves the needs of consumers.”

However, Howard Bennett of Small World Toys, Culver City, Calif., says it can be done effectively by showcasing select product that make sense together. “For example, if a store is displaying cribs, they may also include some crib toys nearby,” he tells Playthings. “We have also seen some strollers sold together with stroller toys.” The idea, he notes, is to present an all encompassing children's environment.

Perhaps this 'everything in moderation' merchandising technique is one that toy specialists can employ in their own venues when expanding into juvenile. Without the luxury of floor space of the big boxes, independent stores may be limited by square feet—but not by their innovative ideas for broadening their inventory.

Phil Wrzesinski, vice president of Jackson, Mich.-based Toy House and Baby Too, says today's retail movement from toy into juvenile is much like it was when his family opened its store, more than a half-century ago. “Back in 1949, there were no year-round toy sellers,” he recalls. “Department stores carried toys during the holidays, but if you were looking for a gift for a child's birthday, you had to travel.”

Once Toy House had filled this void, Wrzesinski says his family began to notice that the same customers were also looking for juvenile items, prompting the opening of a juvenile store. “We saw an increase in toy purchases when Fisher-Price was having its heyday in the late 1950s,” he tells Playthings. In the early 1960s, the two venues were housed under one roof as Toy House and Baby Too, offering one-stop shopping.

But it was during the 1990s, when big boxes like Target, Wal-Mart and Toys “R” Us began to creep into the area, that Wrzesinski and his family began to place an emphasis on the store's juvenile section. “It helped take some of the gap away from the increasing competition,” he says, noting how his baby department experienced an increase from 10 to 25 percent. “Juvenile products are a perfect match for us because we get the customers from the start—before they're even buying toys—and hopefully, have them as customers for life.”

In the last seven or eight years, Wrzesinski has taken a particular interest in car seats. “This category has been one of the best tools for expanding into the toy market,” he says. “Just like I wouldn't sell my customers an unsafe toy, I want to educate them on how to ride with their children safely.”

Down the road, in Battle Creek, Mich., Patty Meyer, co-owner of Meyer's Toy World/USA Baby, recounts a similar story. She and her husband Fred's family's toy store opened in 1947 and commanded a strong presence in its Midwestern community. But once the town acquired a Toys “R” Us in 1986, the competition increased. “We knew we needed to diversify into juvenile furniture,” she tells Playthings.

In 1990, Meyer's Toy World signed on to become a USA Baby franchise, and it turned out to be a smart move. “It was not only good for our toy business, but our business as a whole,” says this member of ASTRA (American Specialty Toy Retailers Association). “As in any retail business, you have to know who your customer is, and ours is looking for juvenile furniture first,” says Meyer, adding that the store draws customers from a 100-plus mile radius.

Carrying furniture complements the toy side of the business well; as the furniture portion slows down in the fourth quarter, toy sales pick up for the holidays. “It's a great marriage,” she says of the combined categories.

And creativity is definitely on the agenda for Tricia Alfod, owner of Button and Bows in Richmond, Va. When she opened her independent store 17 years ago, children's clothing was her main focus. But after two upscale shopping malls opened in Richmond last year, Alfod noticed a change in her clientele's shopping interests. “We had to look for something to make up for the fact that people were beginning to dress more casual,” she tells Playthings. She began buying a complete range of furnishings and related accessories—everything from bookends and lamps to bulletin boards, fabric line baskets and decorative trashcans.

Another category that's big with Buttons and Bows' patrons is travel, so Alfod stocks sleeping bags, tents and luggage in whimsical prints of toile and polka dots.

Quite a change from dresses and overalls. But, Alfod says, it was all a matter of assessing what her customers are all about. “People in this area have shifted their interests to traveling with their kids and furnishing their homes,” she explains. “As a retailer today, you have to keep your ear to the ground—and be flexible.”

Much like toy retailers that are expanding into juvenile goods, many toy companies are translating their experience in the play market to fun children's furniture. With so many innovative offerings that are both well constructed and whimsical, kids will gladly heed the call to go to their room!

Spin Master, Toronto, Canada, entered the kids' furniture space three years ago with the release of a flip-open sofa. Because the sizable piece assumed quite a bit of shelf space, some buyers were a bit skeptical about carrying it. “But those who took the risk were transformed into believers,” Harold Chizick, vice president, tells Playthings. “Turnover was high and retailers were doing tons of volume very quickly.”

The success of Spin Master's furnishings foray quickly paved the way for two additional products—a high back chair and a ready bed—and today has evolved into between 50-75 SKUs. The company's Marshmallow line—aptly named for its soft coziness—now includes room décor accessories such as laundry hampers, canopies, headboards and play huts.

Alex of Northvale, N.J., applies its expertise in crafts to artfully designed pieces for both the playroom and bedroom. The company began the furnishings side of its business piece by piece—literally—producing and assembling components for a child's easel seven years ago. Other wooden products were imported from Thailand and China shortly thereafter.

A pre-established presence in the specialty toy market played a part in developing the furniture side of Alex's business. “As we began to create larger pieces like playhouses, theatres and our super art table, there was the obvious paradox of small stores having affluent customers, but minimal space to show off product versus big box stores that have the space, but have different socio-economic customer profiles,” president Rick Amdur tells Playthings. “So we extended our distribution by creating Alex Direct and building our catalogue and online relationships where these larger, more expensive pieces were welcome additions.”

Offering product in both the toy and furniture categories offers an advantage over competitors. For instance, Alex is able to bundle its pieces with related accessories, such as drop clothes, aprons, pads or paper rolls, paints, brushes and more, to offer the customer a complete product.

Another high-end children's furnishings company with roots in the toy business is Guidecraft, Englewood, N.J. The vendor began developing educational toys in 1964 and with the acquisition of Richcraft and its manufacturing facility in June 2000, entered into the schools and institutional furnishings market. “Our migration into the consumer-oriented juvenile furniture market was a natural evolution driven by customer needs and market demands,” explains President Jason Fein.

He believes Guidecraft's experience in toys came in useful during its entrée into furniture production. “Our roots in the school supply industry translate to every item being designed to stand up to the rigors of continuous play,” says Fein. Plus, each piece of furniture has play value built into its design, which speaks to the marriage of both sectors.

In addition, retailers that already carry Guidecraft toys have the ability to cross merchandise with its furnishings, which Fein believes gives them a competitive edge. “Our 'Playroom Accessory' concept allows store owners to capture sales from toy customers looking for more creative storage solutions that encourage children to play,” he explains. “It fills a niche between traditional furniture stores, big box retail stores and the traditional neighborhood toy store. It's a terrific opportunity for store owners to reclaim some of the revenue they have lost in the traditional toy market.”

Also keeping the element of fun top of mind in its furnishings is Deerfield, Ill.-based Levels of Discovery. The company launched into the children's market with rocking chairs boasting playful components, such as hidden music boxes and drawers. “We pack a lot of features into our products,” CEO and owner Jeff Hutsell tells Playthings.“It is those 'levels of discovery' or added surprises that make them special.”

He believes that paying attention to current trends, as well as maintaining a consistent look across product lines, helps stores sell Levels of Discovery inventory more effectively. “When our themes or color schemes fit into retailers' vignettes or looks, that makes it easier to buy from us,” says Hutsell.

The flip side of the toy manufacturer-turned-furniture-producer equation is also alive and well. KidKraft , Dallas, has honed its 30-plus years of expertise in the furnishings business and applied it to wooden toys sold in specialty stores across the country. According to spokesperson Jacqueline Lampert, the company's background “provided an invaluable foundation from which to launch into the toy market. The structural engineering and customer support required in kids furniture set a very high standard for our wooden toys.”

No matter which side of the field manufacturers originate, there appears to be an obvious crossover that results in viable presences in both categories. “We are seeing some activity from a few larger toy companies that are moving into kids' furniture,” observes Lampert.

“Some have managed this cross-over well,” she adds, “expanding the breadth of the kids' furniture category in new ways to make room for their items…basically, expanding the pie, and not necessarily taking away market share.” However, Lampert cautions, this could easily change.

Amdur notices a more apparent trend on the side of the retailers that are moving into juvenile furniture. “Just take a look at your mail, and you'll find three to five catalogues a month from Pottery Barn, The Company Store, Land of Nod, etc.”

Chizick believes the business can be boiled down to three key factors: quality of the execution (great product at a great price), fun factor and utility (does it have a real function?) “If you can develop a product that can deliver all these things, then who wouldn't want to be part of this trend?, ” he asks.