Want to know the power of word-of-mouth? Just take a look at Webkinz, a product described as "Beanie Babies on Steroids" that have sold more than one million units without a single ad being run.
The stuffed animals help connect young users to the web by a coded tag attached to each doll. Kids type in their secret code and a virtual pet replica of their doll appears on screen. According to the company, Webkinz' customers typically range from six and up with kids between eight and 11 often owning more than two of the stuffed animals.
NPD analyst Anita Frazier told AdAge.com, Webkinz' success provides a roadmap she expects many others to follow. "This will be an increasing trend going into the future, as toy manufacturers attempt to use what is appealing about the internet (engagement and interactivity) to keep their products as current and relevant to today's 'digi-native' kids as possible."
The dolls, sold through specialty retailers and gift shops, have relied upon sales reps from the Canadian gift wholesaler Ganz to get products into stores. From there, word-of-mouth, media coverage (including "Good Morning America," "Regis & Kelly" and "Rachael Ray") and retailer support have created a mass-market success from a grassroots beginning.
Webkinz has figured prominently on YouTube, where owners have shown off their collections and also developed original scripts such as "The Webkinz Murderer," by a child apparently sick of a sibling's preoccupation with the stuffed toys.
Steve and Chris Tini, owners of Sweet Be's Candy & Gifts in the St. Louis area, not only carry the full line of Webkinz in their store but also collect the toys for themselves.
"Everyone is so excited about it," Ms. Tini said. "The kids just love them, and parents love them too because they're fun and safe. ... The challenge for retailers is going to be keeping them in stock."
Discussion Questions: What is your assessment of the Webkinz road to success? Do you see this approach, both in product development, sell-in and promotion, as becoming more prevalent in the future? Does the success of the Webkinz approach suggest the rate of failure among new products will be lower than traditional mass-market rollouts?