Build-A-Bear looks to Mall of America store as a revamped model for success
By Kavita Kumar • kavita.kumar@startribune.com
While its recently shuttered store on Fifth Avenue in Manhattan turned out to be a bust, Build-A-Bear Workshop Inc. has found a sweet spot at the Mall of America.
When executives were figuring out where to showcase their concept for remodeling the chain of 400 stores, the Minnesota shopping mecca rose to the top of their list. It fits with the brand's renewed focus on tourist destinations.
Executives unveiled the revamped store on Tuesday. The most obvious difference: Two supersized stuffing machines are front and center. Fluffy white stuff twirls around inside the contraptions and giant yellow teddy bears rotate on top.
In the multistep process of making a bear, the stuffing machine is the transformative spot where children's plush toys come to life as they are stuffed to the firmness of their choice.
"It's our most iconic moment," said Sharon Price John, Build-A-Bear's chief executive. "There's clearly nothing else like this in the mall. It's very engaging, very intriguing, very eye-catching. It's all part of that theater that draws in consumers."
The old stuffing machines were much smaller and tucked in the back of the store.
Build-A-Bear was all the rage when it first launched in 1997 near its headquarters in a St. Louis suburb and quickly multiplied in shopping malls around the country. But it ran into trouble during the recession as sales and profitability began to tank and the brand began to feel a bit stale.
Since she took over the helm a couple of years ago, John has been leading the retailer through a multiyear turnaround that has included closing money-losing stores, expanding the use of licensed products such as Disney's "Frozen" and Marvel's "Avengers," and cutting back on discounts. The stuffed animals start around $12 and can run $32 or more, depending on additional accessories or features.
Now she's focusing on giving stores, which had not had a major update since they first opened, a fresh look and homing in on the types of locations where its stores do best: tourist areas.
A prime example is the 12-year-old Mall of America store, which is one of the chain's top performers. Build-A-Bear also has a second flagship store at Disneyland in Anaheim, Calif.
When they pored through the data, John said executives noticed their best stores got half their customers from at least 50 miles away.
"That was an 'a-ha moment' for us," she said. "Fundamentally, Build-A-Bear is not about stuffed animals. It's about making memories. And so when you're on a trip, we're sometimes that number one choice for that souvenir."
The revamped Mall of America store now offers a stuffed moose exclusive to that store that has the mall's name on a hoof. And while it often carries the gear from local sports team in its stores, it will soon enable tourists to order their favorite team's items and have them shipped to their home.
Build-A-Bear's emphasis on tourist destinations can also be gleaned from the decision to close its 22,000-square-foot Fifth Avenue store this summer and to move it to a 3,000-square-foot space on the ground floor of the Empire State Building. The latter, which is similar in size to the Mall of America store, is a much more family-oriented tourist location compared with the fashion district, said Stephanie Wissink, a Minneapolis-based analyst with Piper Jaffray & Co.
"I don't think they're going to abandon malls, but they will look at malls with a high incidence of family tourism," she added.
Build-A-Bear has been targeting new stores for areas that draw lots of outside visitors such as Hilton Head, S.C., and Williamsburg, Va.
Its Mall of America store has prime real estate, located along a heavily trafficked corridor next to the rotunda where the mall holds events. It's also near the Sea Life Aquarium and American Girl store.
But like a lot of its stores, it was in need of an update.
"Like all great brands, you have to evolve over time to keep up with today's tastes," John said. "We really hadn't changed the branding since 1997."
Another change in the new store remodels is a more neutral color palette. Yellow walls have been replaced by more modern white walls and wood paneling. The company made that change to be more inviting to people of all ages. About 20 percent of its customers are over the age of 12.
"We don't want anyone to be embarrassed to come in," said Gina Collins, the company's chief marketing officer, adding that teenage boys sometimes come in to buy bears for their sweethearts.
Build-A-Bear's new store design has already been rolled out to two other new stores this summer, and the company plans to phase it in at other stores as those leases come up for renewal.
An hour or so after the Mall of America store reopened on Tuesday, Tara Decker of West Fargo, N.D., walked through. "It's more open," she said of the new design. "And they're definitely more friendly today."
She tried to excite her nearly 2-year-old daughter who she pushed in a stroller with some of the stuffed animals, but she was tired and hungry. So she planned to return after lunch and a nap.
Kavita Kumar • 612-673-4113
