Capturing a "Growing" Market

When we were young, back-to-school shopping tended to be a drag. Mom carted us to Sears to stock up on socks, underwear and notebooks. Today, however, visiting the mall is anything but a hassle for kids."Just five years ago, virtually all back-to-school marketing was targeted to parents," notes Dr. James McNeal, a professor of marketing at Texas A&M University, College Station, Texas. "Now, half to three-quarters of it is in one way or another targeted to the children themselves."I don't know of any consumer goods industry that doesn't target kids, as either a primary market, an influence market or a future market," he says. McNeal has authored three books on children's consumer behavior with a fourth one due out soon.A proliferation of books, newsletters, conferences and articles like this one attempt to understand and quantify the kids' market. And with good reason. Not only are today's kids tomorrow's adult shoppers, but kids themselves represent a significant market in their own right.According to research conducted by McNeal, children between the ages of 4 and 12 are spending $23.8 billion of their own money annually and influencing close to $200 billion worth of their parents' purchases. "Children 12 and under have a potential market value of $500 billion," he estimates.Rena Wallenius, director of Encinitas, Calif.-based North Shore Communications Inc., producers of The Marketing to Kids Report, has watched the spending power of kids age 18 and under grow from $50 billion just over a decade ago to its current $162 billion valuation. Generation Y, kids between the ages of 10 and 19, alone spent $91.5 billion in 1997. "That's almost 60 percent higher than the discretionary spending of that age group 10 years ago," she says.So whether you're marketing a product to kids or to their parents, "It's important to ensure that point-of-sale materials are kid-friendly in a way that will inspire a child to make a request," notes Gene Delvecchio, a youth marketing consultant and author of "Creating Ever-Cool: A Marketer's Guide to a Kid's Heart."KIDS HAVE CHANGEDIf you think kids are more "with it" than you were at their age, you're probably not imagining things.Today's youth "are more independent as consumers at an earlier age," says McNeal. Furthermore, children who are reared in a single-parent household enter the market as consumers at a much earlier age than do children from two-parent households. And the number of children raised by single parents is growing.Earlier this year, Mott's Inc., Stamford, Conn., made its first effort to "swing the pendulum from mom-approved to kid-requested," according to Rose Grabowski, director of promotions. In the past, she says, "we've pretty much targeted moms with a kid premium, like last year's educational computer disk." This year, Mott's is appealing directly to children, using Nickelodeon as the vehicle.First, the applesauce maker partnered with Nick Jr.'s preschool television hit, "Blue's Clues," by introducing "Blue's Clue's" Berry applesauce. An on-pack offer invited kids to mail-in for a free toy. In-store signage, custom shippers and specially designed cases promoted the program on Nickelodeon. And everywhere, Blue The Dog smiled out at kids.With the release of the "Rug Rats" movie in August, Mott's targeted 6- to 11-year-olds. Key retailers received in-store shippers offering a kid's accessory premium and were encouraged to build a "big event" around the program, according to Grabowski.SITTING DUCKSNot all marketers target kids directly with displays. Indeed, some find the very concept objectionable. But most use bright colors and graphics to capture little eyes and imaginations, with text to inform older buyers.Ralph Giuffre is executive vice president of marketing and licensing for Humongous Entertainment, Woodinville, Wash., marketers of point-and-click computer adventures on CD-ROM.While most of its products appeal to kids between the ages of 3 and 10, Humongous makes it a point not to speak to the kids directly in the store. "We do not market to the kids," says Giuffre. "That's a no-no here. We don't want to create the nag factor."In the store, we want to convey the happy qualities, the color, the fun of our characters," Giuffre adds. "We do not attempt to get [the kids] to spend mom and dad's money."Other brand marketers, like New York-based Nickelodeon, draw a distinction between talking at and talking to children. "The Nickelodeon manifesto ... puts kids first," says Pam Kaufman, vice president of marketing. "We don't use the terms cool or fun [on our displays] and we don't hype or over-promise."A RECEPTIVE AUDIENCE"Today's kids are more sensitive consumers to P-O-P materials," says Texas A&M's McNeal. For one thing, children are more visually oriented than adults. "And the visual aspects of displays, along with the multidimensions, the colors and sounds that marketers are able to incorporate, make the medium more appealing to a child."To a great extent, adults are jaded by any marketing efforts," he continues. "Study after study shows that adults mistrust advertising and two-thirds of them try to ignore it. But this is not true of children." At least not until age 11 or 12, he adds.P-O-P can be a particularly strong access road to children by the simple fact that it attempts to reach them. Despite the visibility of major licenses, most products for kids are not advertised. Last year, 25,000 new products were introduced to the marketplace, of which about 5,000 were for children, according to McNeal. "Many of those were small producers who do not advertise to children at all," he contends.So what sends a child into the store? The experience. They enjoy exploring and discovering new things, and stores can be a magical place of information and adventure. "The store is a major source of satisfaction for children," McNeal says."I think kids come to expect P-O-P," notes Lory Zimbalatti, marketing communications manager for Cambridge, Mass.-based Necco. "There's so much now to compete for their attention that you constantly have to give them something new and interesting." With the recent introduction of its CyberSpeak candy -- a 21st century version of Necco's conversation hearts -- a fancy shipper featuring a lenticular 3-D motion header plays up the messages printed on the miniature computer-disc shaped candy.ALL PLAY AND NO WORKThe main difference between kids and adults is the prioritization of their needs, McNeal believes. "For children age 9 and under, the most important need is play," he says. "One of the problems of marketing successfully to children is that all the marketing is done by adults."Marketers who are also parents sometimes "feel like they have special insights into children," he notes. But this isn't necessarily so. And parenting is seldom anything like marketing, he adds: "Mom says, 'Don't play with your food.' McDonald's says, 'Come! Play with your food!' "Fun products, like candy and games, have no problem communicating "play value" at the point-of-sale. But for other brand marketers, it can be a creative challenge. One of McNeal's clients, the World Health Organization, had difficulty accepting the notion that they must offer children play value in their marketing efforts, because the subject -- health -- is a serious matter.ADDING PLAY VALUEMarketers disagree over at what age added value becomes a useful mechanism with which to reach a young buyer. But since play is so important, packaging and displays that promise and deliver extra fun can be enticing."We know what appeals to girls," says Kathleen Watson, marketing director for Purple Moon, Mountain View, Calif. "It's not about price, it's about added value." Purple Moon, makers of CD-ROM games, targets girls between the ages of 8 and 12. "This age group doesn't really care if you save $5. But they like to collect things, so our P-O-P message is the added value that you get with our products." Purple Moon often packages magic stones and dolls with its CD-ROM titles. For the holiday season, the company will bundle a purple Fossil watch on the side of the box.When Purple Moon launched its newest title, "Rocket's Tricky Decision," it included $10 worth of Bonnie Bell cosmetics in every box. At the point-of-sale, the promotion was supported with header cards, shelf talkers, on-pack stickers and shelf strips, as well as a sweepstakes overlay. The tie-in helped the company gain exposure in drugstores and supermarkets.In the same way, Foster Grant adds play value by packaging Sticker Mixers with its Sesame Street sunglasses. "The packaging clearly shows the product and the added value piece," says Bill Potts, vice president of marketing at Dallas-based Foster Grant Group, a division of AAi, Smithfield, R.I. "From a kid's perspective, it's a real challenge to make the package and product look fun."CO-BRANDINGAnother way to confer "fun" is to tie-in with brands that children are familiar with.This year, General Mills' Cheerios paired up with Domino's Pizza, Kellogg's partnered with McDonald's restaurants, and a slew of marketers rode the coattails of children's network leader Nickelodeon. In a tie-in with The Walt Disney Co., McDonald's restaurants came out with Mulan McNuggets to accompany this summer's animated movie "Mulan.""When the child sees promotions on the box for other manufacturers, suddenly he or she is enticed by a couple of different brands in a part of the store that they may not have expected to see those particular brands," notes Delvecchio.To launch its new game, Nintendo of America Inc., Redmond, Wash., and Keebler Foods Co., Elmhurst, Ill., have paired up to present a national instant-win game targeting children ages 8 to 15. George Harrison, vice president of marketing and corporate communications for Nintendo, says the "Find the Magic Puzzle Piece with Banjo-Kazooie" promotion mirrors the activities of the game itself. "Keebler has put Banjo-Kazooie on its packaging and kids will collect puzzle pieces to win prizes."Nintendo frequently pairs up with co-sponsors, as it did with Taco Bell and Kellogg's last year, "to convey the impression that Nintendo is everywhere -- not just on the TV where you expect it to be sold," Harrison says.In a back-to-school promotion with its Nickel-O-Zone programming, Nickelodeon is enabling Kraft to add play value to 13 brands and 100 million packages. Select products will provide kids with an O-scope red-reveal decoder that they can hold up to the TV to solve hidden puzzles. To call attention to the premium, Kraft designed a rotating display using the red-reveal technique.Also this month, Burger King is giving away toys relating to five Nickel-O-Zone programs in its kids' meals.Despite its many partners, Nickelodeon insists it only works with "companies that are relevant to kids and that talk responsibly to kids," says Kaufman. The brand provides a style guide so that co-marketers know what's acceptable for joint promotions.EXTENDING AN INVITATIONStudies have shown that kids often feel unwelcome in stores, where parents urge them to "Be careful" and "Don't touch." Hence, something as simple as a clear invitation to play can open the floodgates to product/child interaction."There's no greater message to children that they're welcome than [an in-store] playground," McNeal says. Play areas encouraging children to interact freely with toys, for sale and otherwise, are increasingly popular not only in toy stores, but in supermarkets and auto dealers as well. Such "displaygrounds" serve multiple purposes. "They not only please the children, but they may give the parent more time to shop," notes McNeal.Last year, Mattel recreated Winnie the Pooh's Hundred Acre Woods in select Toys "R" Us stores and experienced dramatic sales increases. Six-foot-tall trees, a bridge, and life-size storybook characters distinctly set off the Pooh product feature area. "We want to create environments at retail that are fun and exciting for children and parents alike," says Virginia King, director of marketing at the El Segundo, Calif.-based toy maker. "The P-O-P designs are intricate, fun and inviting ... creating a special place for children and parents to spend time."Marketers can also make the store environment more welcoming by segregating product clearly. "The number one way girls are finding out about our product is in-store, via merchandising," says Purple Moon's Watson. To make it easier for girls and parents to find the company's products, the brand has worked with retailers to develop "Girls Only" sections in computer superstores, kids' specialty stores, mass merchants and toy stores."Our research showed that girls and parents were twice as likely to buy our product if they were able to find it in a girls' dedicated section," Watson says. During the 1997 holiday season, "stores that had permanent girls sections had a three to five times sales lift over their competitors who did not," she recalls.BABY STEPSDelvecchio says there are some basic things marketers can do to increase the odds that children will throw their influence to a specific brand. One is to try to own the overall environment, like Mattel does with its Barbie pink. From a distance, even preliterate youngsters can glance up and know "there's Barbie," he says.It also helps to connect the environment, packaging and P-O-P to larger brand elements, especially characters and people, which possess an emotional pull. For example, he says, the Trix rabbit connects the brand's commercials with the cereal box in kids' minds.Accessible packaging is also key. "An open-box format lets kids press the stuff and test it out," says Michele Silver, editor in chief of Small World, a juvenile products industry magazine. And that's an important step in the buying process. "If you can get the child's fingers on your product, you're going to be that much closer to the sale," Delvecchio stresses.Executives at Mattel certainly agree. "Our displays encourage 'try me' because that makes it fun. It's our goal to put it in their hands," says Shelia Anderson, manager of customized product. "We know if they walk over to the display and pick a toy up, it becomes a part of their life, and parents usually put it in the basket."At Akron, Ohio-based Nibble Me Books, Debbie D'Andrea, president, says she relies heavily on floor and countertop displays to attract preschool and early elementary school students' attention. "We like to use photographs of children on our displays when possible," she says. "It helps relate the theme that the child can become different characters in our Picture Me books. And children are attracted to [the image of] other children."The brand's workhorse display features bright polka dot colors direct-printed onto the base, a four-color header with the cartoon mouse logo character, and big bold shapes. "We stay away from too much detail in either words or illustration," says D'Andrea. "It has to be bold, simple and colorful."A SIGHT TO SEETo understand kids, it helps to understand the things they love. Sometimes relating to the appeal of, say, a grinning purple dinosaur, can be a challenge. "Parents hate Barney, but kids really like Barney," notes Small World's Silver. "I think part of the reason is that Barney is very bright and children respond to the color. They love to listen to songs and hear music, and the 'Barney Show' has a big musical element to it." Last year's Tickle Me Elmo appeals, she suspects, "because he's red and he talks in a baby voice, so maybe they're relating to some of the sound, too."That's a good lesson to apply to displays. Marketers are discovering that light, color, sound and motion are perhaps better spent on kids' displays than anywhere else."Motion, however small, can make a big difference" in a display's ability to attract, says Humongous Entertainment's Giuffre. When launching its "Putt Putt game," the company attached a small, battery-operated "time machine" to a floor display that bobbed back and forth in an upper corner. "We try to include many different layers on our P-O-P because we want it to come to life as much as possible," he says. "'Putt Putt' was one of our biggest sellers ever -- and the P-O-P had a lot to do with that."OLD BEFORE THEIR TIMEThe kids market, as opposed to the teen market, comprises multiple subgroups, from toddlers to "tweens," (the 8- to 12-year-old crowd.) These kids go shopping two to five times a week, often under their own recognizance, seeking food, clothing, entertainment and personal care items."The older you get, the less kid-like [young shoppers] want to see a display or package in terms of its graphic treatment, presentation and choice of colors. If it looks like you're talking to kids, a 12-year-old isn't going to be excited about it because he thinks he's a grown-up already," says Foster Grant's Potts.Mattel's Anderson agrees: "Kids are insulted if we treat them like kids." But that can actually make designing point-of-purchase materials for the older kids easier, she adds, because "you can think more progressive.""It's really hard trying to relate to a preschooler," Anderson says. "But if you know that the little kids are reacting to what the older kids are reacting to, it's easier to meet them halfway. Three- and 5-year-old girls tend to emulate the 12- to 14-year-olds, so you have to do things that are trendy and cool."It makes sense, therefore, that if teenage girls flock to the Lillith Fair tour, Mattel's Barbie would naturally form her first girl band. She'll play lead guitar and Sony Music is already planning her first CD.Perhaps the key to marketing to kids is simply to recognize the fact that they are different, from previous generations, from toddlers, from teens and from each other. Anderson hits it on the head: "Kids understand us a lot more than we can understand them." But that's no excuse not to try.

Capturing a "Growing" Market

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