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Archive for Thursday, December 15, 2005

Hot holiday toys send shoppers scurrying for gifts

December 15, 2005

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— If parents haven't gotten their hands on some of this season's hot holiday toys by now, they may have to give their children an IOU slip under the tree.

With both Christmas and Hanukkah about a week and a half away, the nation's toy sellers are running short on a number of items beyond just the Xbox 360, the latest new game console from Microsoft Corp.

Toys in demand include Amazing Amanda, an interactive doll; Dora's Talking Kitchen, a make-believe kitchen set that allows children to play along with cartoon character Dora in Spanish and English; I-Dog, an electronic dog that hooks up to a digital music player; ChatNow, a two-way radio communicator; and Shell Shocker, a radio-controlled vehicle.

"It's frustrating. I'm going to keep waiting and then go to plan B: gift cards," said Dan Green, 34, of Round Lake Beach, Ill. He has been scouring the malls and the Internet for not only Xbox 360 for his 9-year-old son but also for two toys for his 9-year-old goddaughter - a board game called Mall Madness from Hasbro Inc. and a styling head related to Mattel Inc.'s DVD and video "Barbie and the Magic of Pegasus."

Toy makers Hasbro, which produced ChatNow and I-Dog, and Playmates Toys Inc., the maker of Amazing Amanda, say they ramped up production back in October based on early demand, but they can't guarantee that everyone who wants the toys will get them in time for the holidays.

"We're shipping every piece we can make," said Wayne Charness, a spokesman at Hasbro.


Amazing Amanda, an interactive doll, is among toys that are in demand this holiday season.

Amazing Amanda, an interactive doll, is among toys that are in demand this holiday season.

Turning to eBay

All of this is a boon to eBay Inc., which is selling 85 toys a minute, according to Jim Migdal, a senior category manager for toys.

Last week, the online auction house sold 2,350 units of I-Dog, up 68 percent from the previous week; and 1,600 units of ChatNow, up 45 percent from the previous week.

As in the past few years, there isn't one must-have holiday hit. But toy sellers such as Toys R Us, Wal-Mart Stores Inc. and KB Toys Inc. report that they have been pleased with sales, fueled by strong demand across all toy categories, particularly kid-friendly gadgets. That's good news for the industry, which has been in a slump for two years.

"It spreads the wealth around the industry, and acknowledges that not every kid wants the same toys," said Chris Byrne, an independent toy consultant.


Dora's Talking Kitchen is among this season's hot toy buys.

Dora's Talking Kitchen is among this season's hot toy buys.

Toy retailers are having a "pretty good holiday season," said Sean McGowan, analyst at Harris Nesbitt, who estimated that holiday toy sales growth would be anywhere from unchanged to up 2 percent from the year-ago period, reversing a downward trend.

That's a big relief for the industry, which has struggled with sluggish traditional sales as children are growing out of toys at a younger age and are more interested in trendy clothing and gadgets like digital music players. Toy retailers also were concerned that high gasoline prices would make parents more conservative.

Aggressive discounts

Amid such challenges, the nation's toy sellers came out with a slew of kid-friendly gadgets like ChatNow and VCamNow, a video recorder. Retailers also have aggressively discounted toys, with Wal-Mart, the nation's top toy seller, taking the lead. And while toy shortages are surfacing in the final stretch, McGowan said retailers had done an overall better job than last year in keeping the hottest toys in stock - even if some shipments are coming in dribbles in the season's final days.

There were some surprises, particularly Amazing Amanda, a doll that shows emotions and recognizes certain items, because of its high $99.99 price tag. Another surprise was ChatNow, a pair of $74.99 cell phones that allows kids to communicate within a two-mile radius without paying for airtime.

Byrne said he mistakenly thought parents would wait another year or so until their children were ready to get "the real thing," rather than spend money now.

Ed Schmults, CEO of luxury toy store FAO Schwarz- which has refocused on exclusive toys not found at discounters in its post-bankruptcy life - noted that some surprises were $140 Barbie dolls sporting Judith Leiber and Carolina Herrera designs, as well as a $1,600 life-size reindeer, under its store label. Both items are sold out.

Sheliah Gilliland, spokeswoman at online toy seller eToys.com, said the retailer sold out of Spin Master Ltd.'s Slurpee maker and Fisher-Price's Star Station Karaoke system last week. It's also close to selling out of V.Smile Pocket, a portable learning game system from VTech Holdings Ltd. and Tyco R/C's Shell Shocker.

With time running out to order online, the best bet is for shoppers to keep popping into different stores.

Gary Severson, senior vice president at Wal-Mart, noted that some Wal-Mart stores were running out of some of the hottest toys before others do.

Kathleen Waugh, a spokeswoman at Toys R Us, noted the retailer is having a hard time keeping up with demand for certain items like I-Dog, Fisher-Price's Dora's Talking Kitchen, and Amazing Amanda, though it's still getting shipments.

"Shop early in the morning," Waugh advises. "We do get replenishments."

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