Build-A-Bear CEO Talks Target Customer Evolution and Appealing to Adults

Build-A-Bear CEO Sharon Price John joined Cheddar News this week to talk about the evolution of the stuffed animal business. For years, the brand has been geared toward children, but now the company is pivoting to expand its target customer base. "So there are actually two really great examples of how we've evolved from just a kid's based company to also appealing to teens and adults with now 40 percent of our sales to teens and adults. And that over indexes to our e-commerce business," she said.

Closing Bell

Build a bear has been a successful toy brand since its founding in 1997 and does expect significant growth over these next two years. What we've seen over the past two years to continue into the current year. The company also in the middle of a digital transformation as it evolves from a brand for kids to one for older customers as well. Joining me now is Build a Bear Ceo Sharon Price, John for more down here on the floor of the New York Stock Exchange, always with the Bears share and we love to see it. Thank you. It's fun. I appreciate it. Let's talk about what we have on set here and how it plays into this strategy as you expand the company and target a market for adults. I know. So there are actually two really great examples of how we've evolved from just a kid's based company to also appealing to teens and adults with now 40% of our sales to teens and adults. And that over indexes on our e commerce business. Speaking back to the digital transformation, which we actually accelerated during the COVID time period. I think that some companies look back on that and clearly there were a lot of difficulties but how did you use those moments to elevate and accelerate certain aspects of your strategy? And we were able to become much more omni channel and much more focused on that seamless transaction. Um Frictionless interaction with that older consumer who likes to collect things or has affinity products, whether our matrix bears are our Ted Lasso bear, which was just recently. There we go. They're really well, there he is. There's ted with all everything including the mustache. So we love this. It's really been well received and, and we have a special place at micro side on our build a bear dot com called the Bear Cave. That's age gated. So you can get in and get the new dungeons and dragons bears that are coming out or are deadpool bears. That's been a part of that line before the Friends collection or the office collection. Lots of fun things including our After dark collection that has been out a few years now, but it's gotten so much press in recent years because I think people want to be a little more lighthearted these days, but it's aged gated to get in. And it also speaks to the power of holidays with build a bear. Clearly, Christmas is very powerful for us. We had one of the best fourth quarters we've ever had. And in fact, last year was the most profitable year in our history posting digit growth on both the red line and the pretext line. But those holidays then go straight into Valentine's and straight into Easter. And a lot of these are about making memories coming in as a family getting your Easter basket ready. So we're really serving, you know, two distinct consumers in two distinct ways now, which is great. And I like that lasso, not only with the mustache but also the Oh yeah, yeah. As a ted lasso, he got his shirt on and it's celebrating and they're leaving, but so great. So talk to me about the outlook for the company. Obviously, you're coming off of a very strong period. You mentioned the success over the holidays when people are buying gifts. We did just hear from the Fed chair, Jerome Powell, basically citing that there's still some uncertainty out there given what's happened in the banking system the past few weeks. And of course, inflation still an issue that the Fed needs to address as it sees with higher interest rates. How confident are you and your financial models going forward? That demand will be there for your products, right? That's a great question. And of course, we're very prudent. We've always been very uh I think at least in my 10 years focused on very strong financial management, prudent financial management. We have as a company and a leadership team managed this organization through the retail apocalypse, the retail apocalypse COVID. Uh and Um and there are a lot of conflicting data points out there about are already in a recession. Have we been in a recession? Are we going into a recession? But what we've learned is with that focused financial and prudent approach, as well as a lot of levers that you can manage through this. Now, many people believe that build a bear is more of a discretion, very choice and that that may come under pressure. However, with the history that we now have of our ability to manage through these types of things and the prudence with which we do that. Um I think that we have a proven strategy and that we are seeing that again, people want to come out and have a little more family time together. They want to do something a little more light hearted these days and I think we're there for them under those circumstances. And we also have a lot of price latitude. We still have a low entry level price point as well as our birthday treat there where you can come in and pay the age that you're turning. But we also offer these license products and things like that. They're $95 so good. Yeah, okay. We're up against a deadline here. We got to go to break as they would say, believe, believe, believe Bill the Ceo Sharon price, John Sharon. Thank you so much. Thank you. Appreciate it.