Build-A-Bear Workshop aims to introduce its interactive teddy bear experience to children in Sao Paulo, Brazil. The toy market in Brazil is growing and Build-A-Bear hopes to capitalize on this by targeting children ages 5-14, dual income families, and grandparents. Key competitors include Mattel, which has a large market share, and Multibrink, which focuses on plush toys. Establishing brand recognition through in-store demonstrations and advertisements around National Children's Day will be important for entering this competitive market.
1. Group 6: Marketing Plan
Part I â The Consumer and Market Profile
MGCR 352, Section 006
Professor: Sameer Mathur
Shan Chun Chak (David): 260321705
Laura Galin: 260315116
Sophia Herbst: 260353577
Stephanie Taras: 260302965
Rebecca Varon: 260425752
Aminata Wurie: 260299751
Monday November 1st 2010
2. Section 1: Our Product and its introduction into a new market
Build-A-Bear Workshop, Inc. is a company based out of St. Louis, Missouri, that
was founded in 1997 by Maxine Clark. It is the only global company that specializes in
offering children an interactive experience in creating their own customized plush teddy
bear. The company operates 21 stores in Canada and more than 400 stores worldwide
(Build-A-Bear Workshop).
Build-A-Bear Workshop offers fun, unique, and customized products. When a
bear is created, the child goes through a number of steps â âchoose me, hear me, stuff me,
stitch me, fluff me (grooming), dress me, name me, and take me home.â These steps are
not just steps; they are an experience, making our product comparable to dolls. Prices
range from $12-$30CDN for the bears, with the clothes and accessories at an additional
cost. Also, a free online service called CyBEAR Space is offered, which allows the child
to create an online world for its bears (Build-A-Bear Workshop).
We hope to capitalize on the currently stable Brazilian economy by franchising in
Sao Paulo, Brazilâs largest and wealthiest metropolitan city (PricewaterhouseCoopers).
The Brazilian toy and games market is expanding due to the increase in demand for these
kinds of products. The reason for this is mainly the share of imported goods, which has
increased almost five-fold within five years. Imports are responsible for 63% of the toys
sold in Brazil, but national production has remained at a constant level for some years
(World of Toys: Home).
This growing demand illustrates that introducing Build-A-Bear Workshop in Sao
Paulo will satisfy customer needs and wants. Additionally, plush and active toys
encompass approximately one third of the toy market in Brazil (Industry Profile -Toys &
6. Dolls represent the second largest chunk (17.3%) and plush toys represent 8.9% (Industry
Profile âToys & Games in Brazil, 11). The Build-A-Bear product and its experience is a
combination of these 3 sectors. This is extremely important because the activity toys,
dolls and plush toys segments together represent 46.7% of the total toys and Games
market in Brazil. This huge potential market, along with forecasted market growth
provides support for our launch of Build-A-Bear in Brazil.
One trend in the market that will potentially contribute to our success is the
wealth of the grandparents of the baby-boomer generation. They are âmore able to spoil
their grandchildrenâ (Industry Profile âToys & Games in Brazil, 13). As well, demand for
new toys is always high, due to short-lived popularity inherent in toys (Industry Profile â
Toys & Games in Brazil, 13). Build-A-Bear offers thousands of different accessories,
which will hopefully extend the life of the product. Lastly, the growing economy and
rates of consumption in Brazil have seen a corresponding rise in wealth among a majority
of the population (Industry Profile âToys & Games in Brazil, 14). Due to the increase in
affluence, âDemand for [âŠ] toys [âŠ] has increased and the choice of domestic and
foreign toys [âŠ] is plentifulâ (Industry Profile âToys & Games in Brazil, 14).
Competitor Analysis:
The competitive field in the Brazilian toy market is very fragmented. There are
multiple manufacturers producing toys in various sub-sectors. These range from the
traditional plush toys we plan on introducing to class dolls, board games, puzzles and
much more. In 2008, Mattel was the clear market leader. There are many other reputable
manufacturers, but none represent the market power of Mattel. Mattel is an international
manufacturer that, in 2008, had an estimated market share of 30.5% (Appendix). As
7. Table 1a shows, there are many flaws in Mattel that will be advantageous to the launch of
Build-A-Bear in Brazil. Piracy and product recalls weaken Mattel's market share and
negatively affect the brand image. This is beneficial to us as we will be seen as a viable
alternative. Despite this, Mattel's undeniable market size and brand loyalty are a
significant threat.
Multibrink will represent the second most serious threat to Build-A-Bear. This is
because it focuses on the same market segment as our product, dolls and soft/plush toys
(Multibrink, Toys and Game â Brazil). It also incorporates the use of licensed children's
products in order to attract young consumers. This is a threat to us as we plan on doing
something similar with our customization options. Furthermore, Multibrink positions
itself as a manufacturer of low priced items which are distributed using various channels.
The ease in purchasing this established product will deter interest in visiting our location.
Indirect competition also exists in the market. This includes toy companies such
as Estrela and Grow as well as video gaming companies. Leading manufacturers have
been increasingly investing in the Brazilian market (Traditional Toys and Games â
Brazil). For more information on all competition, please refer to Table 1a and 1b in the
Appendix.
8. Bibliography:
Build-A-Bear Workshop-Canada: Home Page. Web. Oct. 2010.
<http://www.buildabear.ca/>.
Toy Industry Association. (Feb 15, 2010). 2010 Toy Trends Get Straight âA'sâ at
107th American International Toy Fair. Earth Times. Retrieved Sept. 26,
2010 from earthtimes.org/articles/press.
Industry Profile â Toys & Games in Brazil. DATAMONITOR. June 2010. Retrieved
from Marketline Database.
PricewaterhouseCoopers. "SP Sera 6a Cidade Mais Rica Do Mundo Ate 2025, Diz
Ranking." O Estado De S. Paulo - NotĂcias, VĂdeos, Fotos Do Brasil E Do Mundo,Online
E Celular. 9 Nov. 2009. Web. 29 Oct. 2010.
<http://www.estadao.com.br/noticias/geral,sp-sera-6-cidade-mais-rica-do-mundo-ate-
2025-diz-ranking,463359,0.htm>.
World of Toys: Home. Rep. Web. 29 Oct. 2010. <http://www.world-of-toys.org/south-
america/toy-market/?L=1>.
Brazil â Country Profile. Euromonitor International. July 2010. Retrieved from
Global Market Information Database.
Grow Jogos e Brinquedos SA - Toys and Games â Brazil, Competitive
Positioning. 30 Nov 2009. EUROMONITOR. Retrieved from Global Market
Information Database.
Gulliver Manufatura de Brinquedos SA - Toys and Games â Brazil, Company
Background and Competitive Positioning. 30 Nov 2009. EUROMONITOR.
Retrieved from Global Market Information Database.
Industry Profile âToys & Games in Brazil. DATAMONITOR. June 2010. Retrieved
from Marketline Database.
Manufatura de Brinquedos Estrela SA - Toys and Games â Brazil, Production
and Competitive Positioning. 30 Nov 2009. EUROMONITOR. Retrieved from
Global Market Information Database.
12. Table 1a â Main Direct Competitors
Manufacturer Information Market
Share
(2008)
Mattel - an international manufacturer 30.50%
- operates in many sub-sectors which include âdolls, action figures,
model vehicles, games and puzzles, and infant and pre-school
toysâ
- manufactures famous brands such as Barbie, Hot Wheels, and
Fischer-Price
- faces constant problems with piracy as well as recall problems
with individual product lines (OPPORTUNITY = negatively affects
the brand image of Mattel)
Multibrink - focuses on the same market segment as our product, dolls and top 10
soft/plush toys (THREAT)
- incorporates the use of licensed children's products in order to
attract young consumers (THREAT)
- positions itself as a manufacturer of low priced items which are
distributed using vary channels
- Super/hypermarkets account for nearly 20% of its sales, where it
faces little competition.
- also uses department stores and wholesalers, accounting for 21%
and 25% of sales respectively
Gulliver - focuses on the niche market of action figures and dolls 2.10%
- has been experiencing a decline in market share since 2004
- planned to launch 13 new toys in 2009 which would stimulate a
10% growth in their market share.
- focuses on selling toys with âslightly smaller unit prices than its
competitorsâ
- sales are heavily concentrated to the South-eastern region of
Brazil, particularly in SĂŁo Paulo (THREAT, this is where we plan to
launch)
Information retrieved from Global Market Information Database, Toys and Games
â Brazil, EUROMONITOR. Compiled for this report.