When Paul and Christina Clark opened Kidding Around in 1991, they didn't want to carry plush.

"We tried to be a little different," Paul says. He and his wife didn't want their New York City store to be filled with the same products as other specialty retailers.

Consumer demand quickly changed their tune.

"More and more people asked if we carried various products and we started to bring in items from Gund and other manufacturers," Paul explains. Over time the owners say that the store did carry more and more plush, and now North American Bear is one of their most popular plush lines. Groovy Girl, Manhattan Toys' line of dressable, plush dolls has become an extremely hot seller, Christina says. "They kept expanding more and more. It started small, and then they added more nationalities and more hair and skin colors. They've expanded exponentially, and (the line) keeps getting bigger and bigger."

New product lines and quality items are what retailers say is contributing to continued consumer demand of plush. Innovation has been the key to many manufacturers who have seen their new product lines really take off.

"Overall business was up. We attribute it to constant development of new products and we saw growth in the impulse category," explains Judy Berwick, spokeswoman for Gund. Providing consumers with a range of new products was just part of the recipe for success, with timing and quick turnover of new items rounding out the ingredients. "We also expanded our seasonal product lines, and this year will be the second introduction of Halloween products. Our holiday products have done very well, which had previously included Christmas, Easter and Valentine's Day."

Lower price points, more variety and originality are what have helped keep the plush products favorites for children's birthday presents while still attracting the adult collector market. Whereas the classic plush toys like bears, dogs and cats remain; new plush-on-the-block has shown up in recent years in the form of food, accessories and even tools.

The plush market has changed dramatically over the past five years. "With the introduction of so many 'collectibles,' the market has been oversaturated in many respects with fewer collectors adding to their collections with the intensity that once fueled the market to new heights," says Lorene C. Shiraiwa, a North American Bear Company spokeswoman.

Shiraiwa also suggests that the collectible niche will continue through the current transition period and eventually stabilize again with the core collectors—especially those who demand higher quality and more uniqueness in their collections. Retailers say that they've seen a dramatic decrease in anything collectible this year, especially plush.

Even if the collectors don't return in droves, the plush sector seems likely to hang on. While different stores carry different plush products, one thing seems to be universal: It appeals to a large range of consumers. Alice Bergman, co-owner of New York City's West Side Kids, sees how kids from 8 to 12 love them, little kids love to play with them, and how they're always bought as birth and birthday gifts. With the vast variety, she adds, there really is something for everyone.

"It appeals to young children, adult collectors and snugglers," says Maryalice Miner, owner of Miner's Doll & Toy Store in Ocean Springs, Miss. "Teenagers can take them to college, and young children can play with the smaller plush."

Sales of plush toys are at what Miner calls 'normal.' "It is never outrageously good," she stresses, "but it is still doing fine." Old favorites remain the lifeblood for the store, and she emphasizes that her customers are looking for traditional plush toys, with Gund bears doing well as the store's steady staple.

Some retail stores, however, are beginning to see small tears in the fabric of the plush market. "Our plush business has gone to the dogs, with some cats thrown in for good measure," FUNdamentally Toys' owner Deborah A. Scholl tells PLAYTHINGS . The Houston, Texas, toy store has seen better days with established plush products. "Traditional teddy bear plush business is in hibernation."

Attempts to branch out with different types of plush products have also been mixed for Scholl, "we tried Hands On's plush Wiggly Giggly, but customers aren't interested. We also stay away from monsters or silly-looking plush."

It hasn't been all bad news, and Scholl admits she is surprised that the main buyer of plush is a tween girl often looking for a special birthday gift.

"We're happy to see items moving down to a $10 to $15 price point," agrees Doug Morris, owner of Little Hands Toy Shop in Glen Ellyn, Ill. "It has really helped the category a lot. It used to be that you couldn't get a nice plush dog for under $25, and it meant that it wasn't something you'd buy for a birthday present or that kids would save up for. Now with the $10 to $15 price point, we're seeing plush move pretty well."

Specialty stores continue to steer away from interactive plush. Customers are simply not interested, retailers say.

"Anything that is interactive defines the way a child plays with it. I think the play should be open," says Alice Bergman. "The child should bring as much imagination to their play, and if the toy is talking, it is defining it."

Miner agrees, adding that interactive toys seem to be much more short-lived than the more traditional plush toys she sells. Miner believes that could change as the toys get better and the computer hardware and software allows the users to do more.

Electronic toys were strong sellers last year and remain very popular. Only time will tell when robotic technology will successfully merge with the soft and cuddly aspects of plush. At the moment, the LeapFrog plush toys generally do enough steady business for Morris and the Little Hands Toy Shop that he keeps them in stock year round.

The other important questions to consider are: Who is interacting with the toy? Does the toy simply run on its own? Does it have something to offer the user? "Our strength is vastly different from the standard 'interactive' market where the interaction is centered between the child and the toy," North American Bear's Shiraiwa tells PLAYTHINGS . "Our designs encourage a three-way interaction between the child, toy and parent/adult where all three elements are engaged in the world of play. The success of our activity books has shown us that this type of interactive toy design is a category which will continue to expand."

Not everyone has the same view on interaction, but all agree that creating and selling superior products is what will set many manufacturers apart. "Our customers in the specialty market are not especially looking for interactive plush," explains Robert A. Zeif, vice president of marketing and business development at Mary Meyer, adding that customers and retailers alike really look for "design, texture and quality."

Consumers are looking for more than the basic brown teddy bear these days, manufacturers say. The task at hand is to create toys sporting contemporary flair, but with that classic, timeless appeal. Kevin Meyer, president of Mary Meyer stresses, "design innovation will continue to be the key factor in our industry, whether mass market or specialty market."

"Just before the millennium started, there seemed to be a focus on bold patterns and bright colors along with wild prints mirroring some of the trends of the fashion industry," describes Shiraiwa. Now the company sticks to more natural color palettes.

The traditional appeal of North American Bear has garnered the company many fans at the retail level, including West Side Kids' Bergman. "North American (Bear) always comes out with some really beautiful, not quite classic, but stuff that really sets it apart from all the others out there. A little bit different but always stunning."

Beanie Babies aren't the only major brand to take a hit last year. Many retailers experienced quite a softening—and we don't mean of the fabric—of most licensed plush toys. Alan Myer, vice president of purchasing at the Pittsburgh, Pa.-based Family Toy Stores chain, pronounces that it is indeed a very rough time right now for licensed products.

"There are new products," Myer says, "but nothing I'd call very exciting. It is a very tough business right now. There really isn't that new hot license like previous years."

JoAnn Barrett, owner of Michigan's White Rabbit Toys micro-chain, says that most products with character recognition have been weaker. "I think our vendors saturate the market," she says, "so we see character categories die faster than they used to. Even Madeline is down."

If even cute little Madeline is feeling the pinch then things must be bad, but some retailers are beginning to see a turnaround. Helping save real animals is part of the draw of Beverly Hills Teddy Bear Company's Stars in the Wild brand of plush toys.

"These are a little pricier plush animal," says Kitty Drury, owner of Da Vinci Toys in Virginia Beach, Va., "but with light-up eyes and sound voice box, they are cute. And who wouldn't love a bear or tiger sponsored by Christina Aguilera or *NSYNC? Part of the proceeds goes to (the animal's) protection."

One animal in no danger of extinction is Scholastic's Clifford The Big Red Dog. It's the one licensed brand that does interest Family Toy Stores' Myer, who believes the red dog might be closest to that breakout product that the chain hopes to see.

"Sell-through has been fantastic," says Peter Van Raalte, vice president of licensing at Scholastic Entertainment. "Clifford's doing better in plush than we ever could imagine."

Finding the room to display the latest products can be one of the biggest hurdles for a specialty retailer.

Denver's Kazoo & Company is among the few specialty retailers where floor space is less of an issue, and owner Diana Nelson explains that the 21-year-old store is one of the largest in North America, complete with its own plush department on the main floor. Sales of all things soft and cuddly account for 12 to 14 percent of the store's business year round with items like classic bears selling quite well.

"We have plush on the main floor," Nelson says, "and we carry everything from $400 bears and $300 dragons to $6 Beanie Babies. Basically, we cover the whole gamut."

Displaying the same products at multiple stores can also be a problem for specialty retailers to overcome. Dan Koenig, co-owner of The Toy Connection stores in Illinois, explains he's overcome the physical differences of their four stores by carrying and displaying plush with many other items. "We put plush with lots of other products," says Koenig. "I see plush as the nuts and cherry on an ice cream sundae." The Toy Connection also makes use of a friendly, inviting, zoo-like environment by creating a mini-store within one of the stores. "We have a classic European look to our stores, and we want to make the plush items inviting to touch, to cuddle, to hug and purchase and take home."

Even smaller stores can utilize eye-catching displays, often with themes that help the plush section of the store stand out. Douglas Cuddle Toys is one manufacturer that works closely with retailers to provide anchor pieces to draw attention to their products. "It has been a strong technique of display," says company President Scott Clarke. "We've used displays like a specially built dog house, allowing our strong breeds to be displayed around the house and with a large dog sitting on top. We like to use displays that might even make people laugh."

Creativity is key to making the best use out of limited space. Necessity proves to be the mother of innovative ideas. "We display our plush on a wedding cake type fixture," explains White Rabbit Toys' Barrett. "This works well as it invites picking the pieces up, which is the key to purchasing. I like to carry large pieces but have to display them up high. I'll sacrifice an occasional large cuddly piece to the floor."

The staff at FUNdamentally Toys often rearranges their store so that they don't devote the space to the same product type for too long, says owner Scholl. Focusing on turnover and keeping its stock levels in line according to sales trends is also important for a store with limited space.

"Merchandizing plush is always a challenge," says Sally Lesser, owner of Henry Bear's Park in Cambridge, Mass. "We try to keep some of the smaller ones together in a couple of units and grouped by family. We also try whenever possible to keep species together and habitat—wild animals, farm animals, etc."

Stuffed animals, she adds, "also soften up the hard edges of boxed goods so they add interest to displays. Big animals get sprinkled around the stores—on the tops of units, as a centerpiece for a display or in a window."