It’s Good To Be Different: Why Independent Toy Stores Need To Work To Differentiate Themselves From The Crowd

It’s Good To Be Different: Why Independent Toy Stores Need To Work To Differentiate Themselves From The Crowd

Independent toy stores are often viewed as the lifeblood of the toy business, and rightly so. While generalist retailers can often deliver the greatest sales volume, their commitment to the toy department and their allocation of space are variable dependent on what else is happening and how their business is doing overall. Of course, independent toy stores have no choice but to fill a shop full of toys, and therefore they are the only guaranteed outlet for our products along with toy specialist chains.

The size of the independent distribution channel varies by country – from the vast array of ‘mom & pop’ stores in the USA, through to the one per town in Germany (both markets where independents are rightly high up the pecking order), through to my own home market, the UK, where there are only around 10% of the total independent stores vs USA & Germany. Even in the UK though the independent toy stores have a greater focus and more ‘clout’/attention from toy companies than perhaps the potential sales volume suggests. There is no doubt that toy companies in general highly value & seek to help specialist toy stores & chains achieve advantage/sustainability versus cost cutting generalist retailers.

Independent toy stores of course do need all the help toy companies can offer, as it is hard for independent toy stores to thrive in this day and age when everything can be bought via the internet at the lowest price on offer. There are some in the toy trade who believe that independents should be able to stand on their own two feet, and should be left to sink or swim – I don’t believe the toy industry is as short sighted as to adopt that perspective en masse, but there is a kernel of truth in the need for independents to differentiate or die! Toy specialist retail chains will often request or be offered exclusive products – maybe a brand extension or a particular licensed product which won’t find full mass market distribution, but which will still appeal to kids – this allows them to differentiate their range from grocers and generalists such as Walmart, Carrefour etc.

Independent retailers won’t get offered an exclusive for their one store, so clearly they need to find another way to differentiate their offer. Generally speaking there are two key ways they do this – firstly, many become affiliated to buying groups, via these groups they can get better terms/pricing from suppliers and better product offerings. Secondly, they can really work on their in store setting to create a really compelling experience/destination for children and families. This is easily said, but often somewhat harder to actually deliver – many independent toy stores are family owned, so staff are often family who aren’t always available to do more than keep up with the basics of shop keeping. Yet above all this is the one thing that independent stores can do above bigger competitors – such corporate stores have very little autonomy at store level typically, everything is planogrammed by someone at head office.

An independent toy store therefore has one key advantage, a customized, flexible offering –fidget spinners, loom bands or whatever is the latest must have toy are easier for independents to take advantage of. These fads offer a comparatively brief but lucrative selling window, and an independent store can really take advantage of the opportunity – with window displays, ‘try me’ outside the store, special promotions/in store events – all offer good opportunities to achieve incremental sales, whereas such a trend is often in and out before bigger retailers can truly capitalize on the opportunity.

One other area where independent retailers can draw people into store is that ‘WOW’ factor – there are some products that you won’t ever see in Carrefour or Target or Argos, some toys that are either very niche or very expensive but really compelling/aspirational for kids to see or play with in store. Generalist retailers don’t need to create the wow factor, they work on pricing, in stocks and having the right hot toys, because they already have huge footfall. Independent toy stores need to work harder on attracting footfall, and then the basics of retailing still apply – good merchandising, good range of products that are appealing and prompting/offers to get products off the shelves and through the tills.

One thing is for certain, toy companies will continue to help the toy specialists, but toy specialists should be very focused on helping themselves by actively seeking differentiation versus their bigger generalist competition – it isn’t ever likely to be easy, but that’s the game!

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