'Plush' decision not so 'easy'
BY PAUL ROCHE -- Playthings, 4/1/2001
Walking both sides of the retail street—mass and specialty—calls for the dexterity of a master juggler. Of course, a focused marketing plan helps too! This is especially true for a manufacturer whose product has longevity and mass appeal, like plush. While the appeal of plush toys is timeless, the selling of them has undergone enormous changes. And like most change, there have been good and bad consequences.
The over-riding positive consequences are that more types and kinds of plush are available to more consumers than ever before and at attractive price points. The major negative consequence is that profits for the plush toy manufacturer generally are razor-thin.
Nevertheless, these manufacturers do have marketing options. They can concentrate on the mass market and hope to overcome very narrow profit by sheer volume. They can focus on the specialty market, which is very different from the mass market, yet inherently more profitable. A third option is to steer a middle course with products geared to both the mass and specialty markets.
As a young company, Aurora by A&A Plush was confronted with these difficult choices and decided to choose the third option: opting to do business with all niches of the toy and gift industries using different labels and designs. This is the option for manufacturers believing that all consumers, mass and class, are their customers.
The particular challenge here, though, is to devise a marketing plan that does not cannibalize sales or hurt the independent retailer. Aurora found the best counter to this challenge was to create separate, definite lines that appeal to each segment.
The mass market is complex, with unique designs per customer, very tight margins and sometimes-difficult challenges in timing, logistics and branding; not to mention the competitive nature of both buyers and manufacturers to reduce margins and still remain profitable.
Long before Priceline.com came on the scene to sell airline tickets, the toy industry was already being 'pricelined' by mass market and variety store/drug chains. Buyers at these mass selling operations had abrogated to themselves the setting of prices, terms of payment and length of payment.
The specialty market, of course, has its own particular set of challenges. Unlike the mass market where one buyer sitting in his or her office can order one million teddy bears at a time, the specialty market is far more fractionalized. And the specialty market demands the very highest in quality plush.
In addition, many of our particular specialty stores, which include small chains and independents, demand personal selling. Thus, old-fashioned salesmanship, using plenty of shoe leather, becomes a prime requisite.
Walking both sides of the retail street can be accomplished with commitment; including commitment to keeping each market separate and distinct, and, of course, commitment to quality.
Quality must go into a product whether it is a mass-produced funky little bear retailing for $5 or a customized panda selling for $150.
Know your markets, stick to them and don't confuse one with the other. I can't count the times a "mass" buyer has asked me to 'knock off' one of Aurora's gift items or to scale down product for mass production.
I have refused every time.
If you start mixing your markets, whether deliberately or inadvertently, you are concocting a recipe for disaster.
Keep your markets clear and clearly distinct.
Paul Roche is sr. vice president of sales for Aurora by A&A Plush, a Compton, Calif.-based company.
