Toys are an essential component of childhood. Parents spend $300-$400 each year buying them for their children, according to NPD Group. And children themselves direct the largest proportion of their allowance — averaging $5-$10 a week — to toy purchases, according to Mintel.
Now, in addition to local independent efforts a la Craigslist and the Freecycle Network, several companies are establishing national online toy exchanges to capitalize on parents’ desire for recycled toys (or to save money).
While the end result — second-hand toys delivered to a family’s doorstep — is similar regardless of the service, each site operates a slightly different business model.
Netflix Of Toys
Toygaroo resembles Netflix and boasts billionaire and media mogul Mark Cuban as an investor. Parents select a plan, such as exchanging a toy in 30- or 60- day intervals, add items to the “toy pouch” queue, and FedEx delivers the item free of charge.
Toygaroo’s least expensive plan costs $35.99 a month for a shipment every other month, with the average shipment costing $120. Parents also have the option of purchasing a toy instead of returning it. This service positions itself as a more upscale version of the toy swap, more akin to Gilt Groupe, than the typical mom-and-pop swap.
By contrast, ThredUp, which started as a clothing swap in spring 2009, serves as a surprise-type of an exchange in that members don’t know exactly what they will be receiving. They select a “toy box” based on a short online description and pay $5 plus shipping to receive it. There are around 3,600 current boxes offered on the site, featuring desired brands such as PlayStation, Wii videogames, and LeapFrog’s Leap Pads.
Members must also abide by the “golden rule” and send boxes filled with toys or clothing in order to continue to use the service. “The site’s biggest challenge is skepticism around anonymity,” says ThredUp’s Karen Fein. “Swapping with strangers sounds like a risky concept.”
While the site does not accept banner advertising, it is exploring “interactive ways to promote brands,” says Fein. To that end, ThredUp recently launched Golden Threds, which are limited-edition boxes filled with new products offered by high end specialty retailers. These boxes are kind of like Easter eggs for ThredUp members in that they are a rare treat among second-hand goods. One recent promotion featured a Willy-Wonka styled treasure hunt.
ToySwap.com hues closely to eBay’s business model in that the site simply serves as a conduit to the buyer and seller. The website lists toys by category, with the most popular searches for Barbie, Star Wars, and Videogame. It features primarily local Illinois advertisers, such as Arctic Air, Inc. and Jack & Jackie’s Dino Jump. [Toys/Online]
Contacts and Connections: Mintel, Jennifer Ballard, 351 W. Hubbard St., 8th Fl., Chicago, IL 60610; 312-628-7946, jballard@mintel.com; www.mintel.com.
NPD Group, David Riley, Director, 900 W. Shore Rd., Port Washington, NY 11050; 516-625-2277; david_riley@npd.com; www.npd.com.
ThredUp, Karen Fein, 59 Grant Ave., 2nd Fl., San Francisco, CA 94108, 518-265-2688; support@thredup.com; www.thredup.com.
Toygaroo, Nikki Pope, 3917 Fountain Ave., Los Angeles, CA 90029; 323-801-8180; nikki@toygaroo.com; www.toygaroo.com.
ToySwap, Toy Box Connection, Michelle Maxia, CEO, 13726 Woodridge, Orland Park, IL 60462; 708-691-2715, www.toyswap.com.