The death of the brick and mortar toy store

In my area, while there are certainly fewer game/toy stores than there used to be, the ones that are left are doing great and are always busy.

My experience in a large US city is surprisingly the opposite. The toy stores I visit are doing great. I suspect this is is because a large portion of their business is for birthday parties.

I assumed many or most were gone because of Amazon. But after having kids and getting gifts for birthday parties, I've learned there are a lot of them and they are doing healthy business. Almost always a line on weekends.

Many or most in line take advantage of free gift wrap because they're on their way to a party.

In many ways it is more convenient than Amazon because you're going out anyway, why not get it at the last second with careful gift wrapping.

But even a recent trip to the suburbs surprised me. The Lego store in the mall had a velvet rope and long line of kids waiting to get in. I had never seen anything like this and apparently it is usually this busy.

I own a reasonably well performing indie bookstore. I've noticed for the model to work you need a critical mass of other local shops clustered to make the trip an experience for families and diverse tastes. My working theory is that three of such small businesses are sufficient and could operate well with a common inventory strategy and manager (e.g. a bookstore, a toy store, and a tea or candy shop...nothing that spoils in the very short term). When I've got a bit more time I want to try that idea and see if it works as a way to revitalize otherwise charming old downtown areas with vacant retail space and communities wishing to bring back their main street. Giving this idea away in case anyone else has tried or wants to try sooner than me and report back.

I have a 7 year old and for the past 3-4 years we make a weekly pilgrimage to a local boutique toy store specifically for birthday party gifts. It’s usually packed with others just like us doing exactly the same thing. They do provide the free wrapping service and they slap their story sticker on every box and it’s a good marketing strategy. But they also stock toys that are pretty unique and change the stock frequently, every kid we know practically has every toy you’d see at a place like Target. Their toy section seems to have been the same the entire time. Occasionally a new movie related toy comes and goes and a couple new big toy trends have entered but generally it’s all the same. Even the baby toys they sell are the same ones my kid had and has outgrown years ago. I’m not certain what their strategy is but it’s definitely not a good shopping experience for maximizing LTV of a childhood.

We also have the Lego store with the velvet ropes and always queued in our neighborhood mall.

Now the only observation I can say is this really only seems to work in affluent suburbs only. My neighborhood mall just so happens to be the top shopping mall in my huge city. It’s a destination for most of the suburbs and exurbs. The boutique toy story birthday present runs is usually around $50 per kid and we go to usually around 2 birthday parties a week during school year (on average). I don’t think most parents are allocating that type of budget for other people’s kids. I have 1 kid, many of my peers are doing the same for 2-3 kids and we all are varying levels of affluent by regional standards (expensive homes/cars, nannies, private schools, etc).

I always wanted to open an indie book store + coffee shop and had a similar analysis. I read recently they are having a come back.

Barnes and noble is opening in my city after a decade ago books a million closed and our local indie closed during Covid.