Many of the major toy chains are going overseas for custom-made toys to complement their more expensive lines, and Wal-Mart, always the budget-price leader, is no exception. Toy box knock-offs are hitting the stores as parents realize that in today’s economy, a $50 toy is no longer in the budget. Kid Connection, Wal-Mart’s toy line which resembles the Leap Frog brand, is filling the shelves as well as the shopping carts of parents looking for less expensive toys.
Kid Connection, Wal-Mart’s private label toy line, is manufactured in China. According to USA Today, 80 percent of all toys sold in the U.S. are made in China. Approximately 40 percent of products sold in Wal-Mart are private label items manufactured by other companies, toys included.
If you have purchased a Kid Connection toy recently, you may have noticed it has minimal packaging. This is a result of Wal-Mart’s “Green” vision to reduce waste and improve the environment. In one year, their efforts with the Kid Connection toy line alone saved 3,425 tons of corrugated materials, 1,358 barrels of oil, 5,190 trees, 727 shipping containers and $3.5 million in transportation costs, according to Wal-Mart.
For Wal-Mart, shelf space for its own brand is carefully planned to allow the most bang for their buck. Wal-Mart, Toys R Us, Target and others have found that dealing directly with overseas factories, and eliminating advertising, marketing and research is proving to be quite profitable. By sticking with the basics such as die cast cars and plastic shapes and figures, these retailers are able to build more profit into their own brands, even though their toys generally sell for less. Wal-Mart uses this approach with the Kid Connection line of toys.
Brand Names versus Kid Connection
As kids get older, they want the latest and greatest toys associated with the latest release of a movie or cartoon. For a younger child who still can’t tell the difference between a Matchbox car and a Kid Connection car, parents have no problem making the switch. Why would they pay $1.98 for one car, when they can pay $2 for six of them? In this case, a brand name does not play a part in selection, only cost.
Toys are a multi-billion dollar industry, and shoppers want to get the most value for their money and toys are no exception. While the consumer may benefit from brands such as Kid Connection, so does the retailer. Having a good mix of products has always been the mainstay of Wall-Mart's marketing theory, and as long as the Kid Connection line makes money, Wal-Mart will continue to sell it.