What you need to know

• The toy market is changing significantly with new categories of consumer emerging, social media giving kids greater "pester power", new privacy laws specifically calling out advertising to kids, and traditional media channels giving way to retail media.
• These are some of the key drivers behind a major technology overhaul, that Moose Toys CMO Belinda Gruebner is kicking off. And she's started with an almost blank slate.
• While retailers remain the core partners, the rise of the 'kidult' market has created a direct-to-consumer opportunity for Moose Toys. Cue a data overhaul and the need to look at CDPs.
• On the B2B side, meanwhile, everything from CRMs to payment gateways is on the table.

Australian toy retailing success story Moose Toys is in the midst of a major overhaul of its technology infrastructure in response to changing market conditions driven by the rise of retail media and commerce, new rules about marketing to kids, changing consumer habits, and the emergence of a fresh category of consumers – kidults.

Those market forces are also driving changes in media mix and distribution, according to CMO Belinda Gruebner.

Moose Toys sells in over 100 countries worldwide, and Gruebner describes retailers the company works with as “the key partner in getting toys into the hands of kids.”

“Our focus has been on B2B and really making sure we're supporting our retail partners to be best in class, including their own ecommerce and digital shelf strategies," she tells Mi3. “We also very much take accountability for driving kids' demand, which feeds our direct consumer component.”

She stressed however that this does not mean getting five-year-olds to go online and buy toys. But the CMO does recognise the potential purchasing power of those big baby blue eyes.

“We are accountable, and we drive how they engage with our brands in the digital space to have that 'pester power' with their parents to buy them the toys," says Gruebner. "Our responsibility to the retailer is to make sure they can do their best job to sell to the end consumer. But we're also driving that demand to ensure our toy sales will be the best they can possibly be.”

As reported earlier this year when Arktic Fox and Six Degrees Executive's 2024 Digital Marketing and Ecommerce in Focus was released, growth, data strategies, brand development and purpose, and digital transformation remain top marketing priorities, and Moose Toys ticks all those boxes. But where is differs from its peers is in the tech. While others are trimming, it's expanding.

Here come the kidults

Covid lockdowns in the early part of the decade also led to the rise of a new category of toy customer – what the industry calls “Kidults” – basically adults buying toys. Gruebner says Moose Toys is only starting to scratch the surface when it comes to having a direct relationship with this new class of buyers.

“It's[a market] that has always been there, but Covid really made it a much bigger part of the industry," she says.

Indeed in some countries, it now represents almost 20 per cent of sales. “Teenagers and above, people in their 20s and 30s, are buying deeply into toys to compete or start collections. So it's opening an opportunity for a lot of toy companies, ourselves included, to have a meaningful reason to have a direct-to-consumer relationship."

Core kiddy business

Kids, however, remain core business for the brand. For the majority of its toys, the sweet spot is 5-8 years old. And kids, as every parent can attest can tell you, can be cunning little buyers.

“It's surprising how many kids will actually go to Amazon to research a favourite toy," said Gruebner.

It is also an age group more online than many people are comfortable acknowledging. “They'll use TikTok, and do searches for their favourite things there. And there's so much social commerce attached now to those platforms for that age group coming through," she says.

Gruebner is well aware of the social responsibility that comes with marketing to kids, but also the reality and the opportunity.

“Whilst they're not supposed to be on those apps, and they're definitely not supposed to be purchasing, their ability to influence their parents to purchase is really high," she says. “Our focus as a company, and certainly through the marketing team is about storytelling. We have to walk a really fine line between making sure that what we're marketing is appropriate to that age group. The storytelling piece is really important and that's about engaging using imagination and giving that toy purpose.”

Beyond that and when it comes to parents, Gruebner sees the need to use ecommerce opportunities on platforms like Amazon that are fit for purpose and can help parents understand the benefits and features of the toys.

“We are constantly oscillating with our marketing strategy around that storytelling component so that 5, 6, 7, or 8-year-olds truly feel engaged and invested in the brand. Then if a parent is being influenced by what they're seeing in their social feed, that's coming up in their Amazon feed, and that we've given them the easiest path to purchase in that digital shelf.”

Media Mix

As with other categories, traditional media channels, particularly broadcast are declining in their influence for toy marketers.

“Globally, Australia probably led that charge more than any other market because of the limited number of free-to-air channels and [also] due to changes to children's TV advertising rules. Advertising to children on traditional broadcast TV dropped off a cliff here in Australia," Gruebner comments.

Catalogues are still popular in parts of the world but even that has dropped back and is more associated with key shopping events, she says. In Australia specifically, there’s been a huge change in the last 12 months, according to Gruebner, around digital shelf space and recommendation.

“All of our retail partners are a lot more savvy when it comes to their digital shelf. That was not the case a year ago," she says.

In fact, it was hard to try and replicate trends from markets like the US due to local market immaturity. “What we were doing in the states we couldn't replicate here, retailers weren't ready for it.”

But that is changing and it's reflected in the media mix. Where 70 per cent of spend would have been soaked up by traditional media, retail media and retailer-owned ecommerce channels are more important in driving awareness for Moose Toys. These are getting customers to the sites, and ultimately leading to sales. That in turn drives investment in the type of assets retailers want for their digital shelves.

“That’s even to the point where some retailers are looking for exclusive types of content so that when customers land on their product pages they are giving them something over and above, that’s exclusive to them and gives them a really good experience," Gruebner says. “Our investment in asset development in the media buying and targeting journey is growing double digits year-on-year in that space."

Technology

Changes in the market and the rise of new categories with kidults are also driving a need for greater investment in marketing technology at Moose Toys – a somewhat contrarian trend at a time when many brands are looking to curtail martech spending.

“The need for us to collect and have first-party market data and have a direct-to-consumer relationship was not a priority, because we were able to drive our business and our sales through our retail customers. It's really been in the last 12 months we've seen the importance of understanding that end consumer and the importance that influencers and kidults are having on the growth in this category. That has changed not only our mindset but also our investment," says Gruebner.

“We will be investing very heavily over the next three to five years in uplifting our tech across all facets of our organisation. Part of that is knowing the right tools and partners to bring into our business from a CRM or CDP [perspective] or even some of the more basic things like payment gateways where we’ve not needed or had any of that [in the past].

“We're at the very start of our journey. It’s exciting because it also gives us a completely fresh piece of paper to work off here and build something fit for purpose to how our customer currently shops. We don't have any legacy systems.”

Gruebner is also very aware of the changes to privacy and data rules coming through in Australia. The issue of advertising to children is a specific concern articulated in the proposed new legislation.

“Because we haven't collected that data, we again have no legacy, we're able to build all of these with the mindset of what's about to hit us or what we can expect is going to hit us. We can do it in a robust way that's setting us up for the next two or three years before the world changes again," she says.

It is a very different world to that of five years ago where if you put 80 per cent of your spend into a TV commercial you would see a good ROI, Gruebner says.

“In literally just five years in the majority of markets, the drop of traditional media and traditional way of reaching kids has fundamentally changed that environment. There’s a need to have this balance of talking to parents and talking to kids through every digital touch point possible.”