The tiny faces of a holiday toy craze: How Shopkins became big business

By Sarah Halzack

A selection of Shopkins, the hottest toy in toy stores. Photo / Bill O'Leary
A selection of Shopkins, the hottest toy in toy stores. Photo / Bill O'Leary

Vicki Vanilla. Susie Sausage. Buncho Bananas.

If these names sound like gibberish to you now, consider yourself warned: There's a good chance you'll soon be on a frantic hunt to get them under your Christmas tree. These tiny plastic characters are part of an explosively growing line of toys called Shopkins, which can perhaps best be described as personified versions of items you'd find at the grocery store or the mall - miniature pastries or high heels with cute faces.

After just over two years in stores, Shopkins has become a huge business: Market research firm NPD Group reports that a 12-pack of assorted Shopkins was the single best-selling toy in 2015, edging out items from popular properties such as Star Wars and Barbie.

The line's US market share rivals that of established brands such as My Little Pony and American Girl, according to Euromonitor. And so far this year, Shopkins has seen a 98 percent increase in sales.

As with any toy craze - Cabbage Patch Kids, Tickle Me Elmo, Skylanders - it's hard to pinpoint exactly why these characters have captured kids' attention and parents' wallets to the extent they have. But industry analysts say that much of it has to do with finding a niche in the noisy toy marketplace that wasn't being filled.

Shopkins are designed to be collectibles. Like baseball cards or Pokémon, you trade them with your friends. There are rare characters that keep you constantly scouring the toy store, hoping to add to your trove.

Prior to Shopkins' arrival, "there really hadn't been a strong collectible for girls," said Laurie Schacht, co-publisher at toy review site The Toy Insider.

Indeed, that was an opening that executives at Moose Toys noticed when they decided to develop Shopkins, whose primary audience is 6- to 10-year-old girls.

The relatively small Australian toy company had seen some healthy sales for a boy-centric line called Trash Pack, a collectible set of what chief executive Paul Solomon describes as "gross little characters who live in garbage cans."

"We saw the opportunity to come out with more of a girl-skewed or girl-themed line," Solomon said.

At a moment when properties such as Lego, Star Wars and Teenage Mutant Ninja Turtles are relying on movie tie-ins to boost sales, Shopkins has taken a different tack, relying heavily on YouTube to connect with kids.

From the get-go, the brand has posted one- or two-minute cartoons on the video site - short bits that can easily be watched on a smartphone or tablet. Collectively, the videos have been viewed some 100 million times.

"We call it snackable content," Solomon said.

That's not the only way YouTube fueled the rise of Shopkins: They have also become popular subjects for so-called unboxing videos, where people film themselves opening a new item. The company has recently pushed to expand its media tie-ins, releasing a full-length movie on DVD this fall.

In this era of fast fashion and same-day delivery, Shopkins has made it a practice to introduce new toys at a breakneck pace. It rolls out an army of new characters about every six months, betting that a focus on freshness is important at a moment when kids (and parents) have so many programming and toy choices. Jim Silver, chief executive of toy review site TTPM, said this strategy may be another reason the brand has gained traction.

"You can go back to Beanie Baby, how that lasted for many years," Silver said.

"What was part of the key is continually refreshing the lines."

We saw the opportunity to come out with more of a girl-skewed or girl-themed line.
Paul Solomon

The price point doesn't hurt either, Silver said. Some items in the line are priced at $2.99, and Solomon says 80 percent of sales are on items that cost $19.99 or less. That means it's the kind of thing kids can buy with their allowance money.

It's hard to know whether Shopkins has sparked a broader wave of interest in collectibles, or has simply been the beneficiary of it. But, either way, NPD has found that the category has "significant momentum" heading into the important holiday selling season, with sales up 64 per cent so far this year.

Juli Lennett, NPD's toy industry analyst, says there is especially strong growth in sales of what are known as "blind bags," where you buy a toy pack not knowing which characters are inside.

Retailers are anticipating a holiday season haul for the brand: US-based Walmart, Toys R Us, Target and Kmart each have some Shopkins property on their "hot toy" lists for the season. Toys R Us has also launched "store within a store" areas for Shopkins at all of its locations that peddle Shopkins and Shopkins-bedecked bedding, jewelry, bicycles and other goods.

To be sure, though, the tiny toys will be up against some stiff competition.

"Rogue One: A Star Wars Story" is set to hit theaters December 16, providing a jolt of momentum to that property. Old-school toys such as games and puzzles have seen monster sales growth so far this year, so items such as Pie Face and Pie Face Showdown are likely to draw big dollars, too.

And then there's Hatchimals, a new toy from a company called Spinmaster in which a fuzzy, dancing-and-singing creature hatches from an egg. Stores were starting to run out of Hatchimals in early November, and the US$59.99 (NZ$85) toy is already popping up on eBay with three- and four-figure price tags.

Silver said he predicts Hatchimals will sell three times as many units as Tickle Me Elmo did in its 1996 holiday heyday.

- Washington Post

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