Staking a claim in the resurgent toys category ahead of the holidays, struggling mid-tier department store Kohl’s Thursday announced it’s boosting its toy assortment, including a limited offering of popular American Girl dolls.
The dolls, previously only available through its catalog, online or at its own flagship American Girl stores in major cities, will also be sold at dedicated shop-in-stores at several Toys R Us stores nationwide, the companies announced last month.
Sales of toys in the U.S. rose 7.5% in the first half of the year, past last year’s mid-year and annual growth rates, according to global information company The NPD Group. In previous research NPD Group found that toy sales Christmas week (Dec. 20-26) last year grew 25%, more than all other Q4 weeks combined, and that week accounted for 8% of the toy sales for the year. The week before Christmas topped that at 8.5%.
Perhaps even more than changing leaves and falling temps, announcement like these from Kohl’s and Toys 'R' Us, with their Santa-like lists of toys, are a sure sign that the holidays are coming.
With toy sales rising, retailers that sell them are staking some hope on the category. "Star Wars" last year had a major impact on that boom — "Star Wars" toy merchandise had the force as the biggest contributor to the industry’s mid-year growth, with sales rising nearly 200% through June, according to NPD. Lucky for retailers, another installment, "Star Wars: Rogue One," premieres in December.
Both these retailers are leveraging another toy phenom — the American Girl series of dolls and accessories that have been making best friends and enchanting children (and extracting money from grandparents) for decades.
But the brand has begun to slip, and parent Mattel has struggled: In its most recent quarter, American Girl’s revenue fell 19% year-over-year.
Flagship American Girl stores in cities like Chicago and New York are more than merchandise on shelves — they include cafes (reservations advised, dolls invited), a hospital (for doll repair) and other experiences designed to charm doll owners (and extract yet more money from grandparents.) Moving into other retail ventures with Kohl’s and Toys 'R' Us is quite a departure from its experiential flagship shops, although the Kohl’s run is limited and the concessions at Toys 'R' Us will be run by the doll company. Clearly Mattel hopes those moves will revive sales, but there’s a risk that having dolls in less-than-premium outlets could hobble the American Girl brand’s premium stance and impair its ability to ask for top dollar.