Walmart Reveals Third Front to Drive Store Brand Sales

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September 30, 2009

As part of an exclusive licensing deal with Garanimals, Walmart launched a new Garanimals line of sturdy and reasonably priced play and learning toys.

Featuring age appropriate toys for infants, toddlers and pre-school children, the toys boast many of the same animal characters from the kids apparel line introduced exclusively at Walmart last year.

Prices for the toys –– which emphasize activity and education –– range from $3 to $29. The new brand will be supported by a multi-million dollar television advertising campaign this fall, according to Walmart.

“The new line is a part of Walmart’s effort to enhance our pre-school toy assortment and provide a new selection of quality toys that many moms will remember from their youth, with a superior value in comparison to specialty stores,” said Laura Phillips, chief toy officer and vice president of toys for Walmart.

Garanimals is a division of Garan Inc., a wholly owned company of Berkshire Hathaway headquartered in New York.

SBD View: Wal-Mart is clearly not satisfied just being the world’s largest retailer and CPG company. The Garanimals toy deal marks a third front in Wal-Mart’s drive to supercharge their store brand sales. Exclusive licensing deals like this -- added to their established programs (think Better Homes and Gardens) -- indicate that licensing, exporting successful store brands from one country to another (ASDA wines at Seiyu in Japan), and multi-category proprietary brands like Great Value make up a three pronged strategy for driving store brand margins. How far can Wal-Mart go in driving store brand sales? What’s your view? Let’s us know by posting a comment in the space below or sending an email to jfailla@storebrandsdecisions.com.

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