Richard Gottlieb

After KB

After KB’s demise, will malls become a wasteland for the toy industry or will other toy retailers move in and create new growth? KB has been the sick man of the toy industry for a very long time. It’s been a bit like having a beloved uncle on life support that kept fighting back but you knew it was only a matter of time. Well, that time came and KB is gone. No more trips to Pittsfield, MA.

There were some terrific people who worked in the KB offices and stores and we all regret the loss of their jobs and hope to see them in new positions in other organizations very soon. They were our friends as well as business associates.

KB and its management certainly fought the good fight but a business model originally predicated on highly trafficked malls ultimately failed as that traffic went elsewhere. In the final analysis, KB was ultimately never able to overcome the downturn in mall traffic and the change in that traffic from families to adult women, teens and tweens.

There will now be no national toy presence in U.S. shopping malls. Sure, one can find the Macy’s / FAO Schwarz store within a store, Calendar Club and the Build A Bear Workshops, but these are very specialized and don’t offer the true toy store experience of being able to choose from a broad variety of products.

This absence challenges all of us to ask some hard questions:

• Was KB all this time taking up space in the mall that could have been better utilized by a toy retailer with a better concept?

• Is there a toy business model suitable for malls?

• What company or companies can and will replace KB?

• Will mall based department stores finally go back to dedicating full departments to toys?

• Will retailers currently engaged in marketing to teens and tweens expand their offerings?

This industry needs as many alternative retail outlets as possible. It does not need to be a national chain. It could be a series of excellent regional retailers or one off independents. Whatever happens, it is in everyone’s best interests (and that includes malls) that toys return to the malls and return soon.

Posted by Richard Gottlieb on December 17, 2008 | Comments (3)