Ted Lasso and Pokémon bears: Build-A-Bear bets big on 'kidulting'
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Build-A-Bear Workshop (BBW) is tapping into teens and adults in an attempt to boost sales, CEO Sharon Price said in an interview on Yahoo Finance Live.
As consumers cut back on discretionary spending elsewhere, Price said, the importance of "celebrations and memory making" is still high as consumers "want to be a little more lighthearted and have some fun together." The end game: Build-A-Bear fans purchasing more gifts and collectibles.
"We call (that) 'kidulting.' It's a big trend," she said. In other words: adult consumers' desire to reconnect with their inner children.
Such offerings are intended for an audience 18 years of age and older. For instance: the After Dark lineup now makes up a growing portion of the chain's business. "We expanded our addressable market...40% of our sales are teens and adults with collectibles and gifting," Price said.
In Build-A-Bear Workshop's latest quarter, net sales were $138.2 million, up 10% from the same quarter a year ago.
Merchandise in the The Bear Cave collection includes themed teddy bears for St. Patrick's Day, Valentine's Day, 21st birthdays, happy hour, and spring break, among others. It also includes Collabs, which is a huge draw-in for older customers with 75 different licenses to create bears tied to pop-culture, including Pokémon, Harry Potter, Star Wars, Super Mario, Peeps, Disney and most recently, Ted Lasso.
An older audience also means a boost to online sales too. In a call with investors, Price said the "e-commerce business tends to over-index with the older teen and adult consumer who have diverse product and participations...gifting for more reasons than kids' birthdays and collectibles."
"That older consumer really does want to do the most frictionless, fewer clicks," Price told Yahoo Finance, "I just want my next Pokemon."
Another plus of bears for adults, is the ability to set higher prices. "Some of these collectibles... that are targeted toward the older consumer, like Ted Lasso or the Harry Potter products, we have a little more price latitude there," meaning there's a broader range of price options for the chain to implement. As seen below, the "Ted Lasso Bear Bundle" can be priced at more than $60.
Typically with children, Build-A-Bear tries to keep costs lower, said CEO Price. "We always want to be accessible to, particularly, to our kid consumers," with a low-entry level price point, like its Birthday Treat Bear, she said.
She added: because the company is "a vertical retailer," it manufactures everything from start to finish. Thus it is able to have control over what it charges with "a lot of price discretion," Price said.
Meanwhile, investors should be happy. Compared to last year, shares up nearly 29%, outpacing the S&P 500 (^GSPC), which is down more than 12%.
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Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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