Hot toy may boost holiday sales

Ty Beanie Babies proved so profitable for Tom Ungrodt’s stores in the 1990s that he and fellow gift retailers figured they might never see the likes of them again.

A new plush toy combining real and virtual play has Ungrodt tossing aside that conventional wisdom.

“We’ve got another hot item,” said the president and CEO of gift-catalogue producer Ideation, Inc. in Ann Arbor and owner of three Michigan gift stores. “Webkinz are not only driving up sales right now, they’re looking like the hot item for this Christmas and beyond.”

Manufactured by the Toronto, Ontario-based Ganz company, Webkinz are “lovable plush pets” that come with a unique code allowing their owner to enter an elaborate Webkinz World website. In that virtual world, children can care for a virtual pet, answer trivia, earn KinzCash and play games.

“It’s good, clean entertainment for kids 6–13, both boys and girls,” said Ungrodt, also a member of the Michigan Retailers Association Board of Directors. “They really started to take off on the East Coast just before Christmas last year, and Michigan stores didn’t begin to see them until January.”

Ungrodt says his three stores combined currently are selling between 150 and 200 Webkinz a day, a figure he thinks will increase during the holiday shopping season.

“I expect it will drive my sales between now and Christmas. We anticipate our sales will be up 20 percent—15 percent related to Webkinz.”

Retailers also can expect spinoff sales from parents bringing their children into the stores, Ungrodt adds. “We’re projecting all sales to be up substantially.”

Frequent introductions of new pets, news stories about shortages of the Webkinz at some stores and frantic calls from parents looking for fresh deliveries are all reminiscent of the Beanie Babies craze.

Ideation’s recent Holiday Buying Meeting in Indianapolis featured Ganz’s vice president of U.S. sales, George Kacic. Ideation is offering five of the Webkinz pets in its fall catalogue and Ganz has guaranteed delivery of those orders, Ungrodt said.

“If retailers aren’t selling Webkinz, they should be,” he added. “They increase cash flow and can pay a lot of bills. We expect this to be a several-year concept.”