From the source: Gavin Port, Build-a-Bear
BIO: Gavin Port joined Build-a-Bear as CEO in 2008 when he invested in the company and helped grow the business into a national brand. Prior to his current role, Port spent nearly 10 years in corporate retail, incorporating multiple roles at several multinational companies.
COMPANY PROFILE: Build-a-Bear first launched in 1997 in Missouri and opened its first Australian store in 2004. The business now has 400 stores around the world in Europe, Brazil, Asia, the Middle East, Canada and Puerto Rico.
IRW: What has it been like for Build-a-Bear since it arrived in Australia?
GP: “It came to Australia in 2004 and started in New South Wales. There were some rapid growth in the early days to bring the brand some sort of awareness but it took some time to build. The expertise was a little light-on.
I looked at the business in 2008 and felt that we could significantly upsize the brand with the right skill sets, so combined with some added skills, I took it to the next level. We put an emphasis on marketing and PR around being in the right locations at the right price points to drive awareness and excitement about the brand. It just flourished into more sites. It was interesting how Build-a-Bear had so many touch points in areas where there were no store locations – word-of-mouth and marketing had a huge spread for us. So from there, we grew into the national brand that it is now.
There was some significant double digit growth in early 2010 for a good three or four years ‘til we capped our stores and since then it’s been moderate growth. Significant growth was based on store openings, but since then we’ve had a solid business.”
IRW: And what business plans do you have for the year ahead?
GP: “2017 is almost a new era for us for retailing opportunities. We’re broadening the brand to more locations in areas that we haven’t previously been able to enter due to capital expenditure requirements.
The new kiosks and concession stores allow us to open more locations in sub-regional shopping centres. It’s something we’re very excited about. Traditionally, Build-a-Bear was a shopfront-only retailer and by having these new opportunities, kiosks allow us to go to markets where there are smaller populations and it’s not commercially viable for us to open a full in-line store.
The kiosks are almost like miniature stores. Our traditional stores are generally a circular design in terms of the step-by-step process of the kids building their bears. It’s the same with the kiosk, you go around from purchasing the skin of the animal, to the sound, the stuffer and so on and you work your way around the kiosk. The kiosks are around 6 x 3, so the limited space capacity doesn’t allow us to sell our full range, but we’ll sell the best selling lines.
We’ve got a three-stage process in terms of trailing and rolling them out two or three by mid-year and strategically and commercially, if they are as we expect, we’ll have another five to ten by the end of the year. The first two are planned for Cairns and Shellharbour.”
IRW: Build-a-Bear is often an emotional experience for customers coming into the store. Can you explain the meaning behind customers ‘putting a heart’ into their bears?
GP: “It’s always age-appropriate depending on who is building the bear, but that’s the step of bringing your bear to life. We’ll have you play games with your bear, hold the heart and hop on one leg or rub the heart on your funny bone so your bear will be funny – then you give it a kiss, make a wish and place it in your bear.
Once your bear alive and you’ve created your best friend, then you’ll want to dress it up or add accessories. Children might want to give their bear a profession, so they can personalise their bear and turn into a character that they want to play with. That’s the big difference between us and the other retailers – the heart ceremony.”
IRW: Experiential retailing is on the minds of a lot of retailers right now, but it seems that it’s always been inherent at Build-a-Bear.
GP: “I’ve often heard comments about the technology age and iPads and iPhones and how it’s going to detract children’s attention away from traditional plush toys but by the end of the day, since I’ve been involved at Build-a-Bear, the business has only continued to grow. At the end of the day, every child wants to hug a teddy bear and you can’t take that away from them. It’ll be there forever. There’s an emotional feel and touch component that will always be there.
There’s a big difference between us and a retail store that sells a plush toy off the shelf. Our adult guests have a real affinity with our brand because it allows them to create an experience for themselves and their child. You’re bringing that bear to life and that animal is cherished and respected because you’ve built it. You’ve given it a heart and created something together, so for us, it’s all about offering that in-store experience.”
We’re not a traditional retailer where we need our guests to come and purchase a product. We’re all about the experience play feel and touch, so we’ll run events where guests can come in and have their bear refreshed, re-fluffed and share that experience with their loved ones. We hold events where you can book in to do that.
It’s all about coming in and feeling and touching – we certainly don’t drive sales. If the guest would like to purchase, wonderful, If not, wonderful. For us, it’s about the constant touching of the brand and the kids staying related to the brand as they grow.
Our teddy bear parties are certainly a big part of our business and they’re a great marketing tool for us because the kids who are invited get to touch and feel the brand and often we’ll have further bookings made through each party because some of the party guests will go, ‘Wow, I’ve never been here before. I want party too.’
There are no additional costs for the customers when they book a party [apart from the costs of a bear], but we always play games with the guests to add some fun and excitement to the group and generally, depending on the age group, a ‘heart’ goes into the bear. It may be that every child at the party will add a heart to the birthday child’s bear. We make it special for the birthday boy or girl and we want the guests to feel part of the experience.
If there’s a movie or product launch that we know is going to be a very strong seller, with strong consumer demand, we’ll run a pre-launch event so customers get to feel and touch the brand with like-minded people. Then we’ll play a game based on the movie or product that’s being promoted at the time.
We have stuff and fluff events too, where kids can book in to have their bears groomed so they come out clean and fresh again – some kids take their bears everywhere, sitting on chairs in restaurants and on planes! The experience is so different to just purchasing a plush toy off the shelf from another retailer – you’ve made your bear with us and you’ve brought it to life.
We do a lot of cross-promotion of licensed products that add integrity to both businesses. Not only are customers buying into the experience, they’re buying into the brand. It fluctuates depending on movie launches but generally, there’s a reasonable range of licensed product around the year in our stores, such as X, X and X. I think we’ve ordered three months’ worth of stock in the lead-up to Beauty and the Beast and we’ll probably run out in under two months!
The essence of who we are is guest engagement and offering customers an experience. That’s what consumers are looking for. I’ve seen surveys that show guests are prepared to pay for that service and I think that’s the key today for retailers – it’s about offering a personalised service and building a relationship with customers.”
IRW: Tell me about the activations Build-a-Bear has been running in shopping centres lately.
GP: “Again, there have been a lot of malls we haven’t been able to open in due to commercial reasons and they’re in communities that are out-of-reach from our stores, so we often have landlords asking us to run school events during the holidays, whether it’s for a day or five days to allow their guests touch the brand.
We’ll take a portable stuffer and we’ll take some staff and products [to the mall] and it allows guests to experience what we have to offer. We’ll always ensure that whether it’s in-store or off-site that the experience is there – the essence of putting the heart in the bear and making a wish is non-negotiable.
The events are generally pre-booked and they usually sell out within days. We’ve been doing them for a year or so, but it’s starting to snowball over the last three to six months. For us, it’s all about having the brand in more locations and allowing more people to experience it. It is certainly something we’re looking at expanding.”
IRW: Do you see yourselves expanding your Myer concession stores?
GP: “The stores are all part of the long-term strategy of getting the brand in more places and Myer has the same alignment with the same guests as us, so it’s a great partnership. We have a concession store in Myer in Melbourne and Sydney. It’s still going though the testing stages, but the intention is to move forward with more sites and build that relationship further.”
IRW: How is the launch of the discovery stores going?
GP: “The discovery format has only been around for a short period of time. The US launched them last year and generally, international franchisees don’t take these new rollouts until there are some proven commercials behind them.
The international side only moved into the new format late last year and we’ve only had one store format converted so far in Chermisde Westfield in Queensland. Our Joondaloop store in Western Australia will be converting in May.
Early indications have shown very positive feedback from the guests, so it is something that as leases renewal, we’ll look at converting our traditional stores to the ‘discovery’ format where it’s commercially viable.
The colours are different, they’re not primary colours anymore – the stores are blue and white with some wood. The layout of the store is different, so it’s certainly a significant modern refresh. The discovery stores have a more modern look and feel.
It certainly brings our brand up to the 20th century. The previous stores had a more craft-y look and feel as opposed to the newer stores where it’s all about imagination, creativity.”