Next Year, Will 90% of Premium Baby Gear Be Bought Online?
The market for baby gear in the US is growing rapidly, with first time parents choosing to shop, purchase and create online baby registries at a variety of places:
- Premium online baby product retailers like Pish Posh Baby and Magic Beans. These specialists are category experts who provide curated products, expert advice and reviews
- Premium department store retailers with strength in the baby category, customer service and loyalty programs, like Nordstrom’s Nordy Club or Dillard’s
- Leading mass market baby specialist Buy Buy Baby, with 50%+ of sales online and boasting the #5 online registry
- Mass market online retailers like Amazon, Target and Walmart
- Online baby registry specialist babylist
We recently interviewed two leading industry experts who are at the frontlines of change in the baby gear market.
Both of these leaders guided their organizations through rapid growth in eCommerce and aligned with changes in how parents shop and learn about premium baby gear. The market experts are:
- Eli Gurock, CEO and Cofounder of Magic Beans. With 17 years in the business, Eli’s Magic Beans is consistently recognized as an industry leader, with particular strength in marketing
- Charlie Birnbaum, COO of Pish Posh Baby. Charlie joined Pish Posh Baby five years ago, with the explicit goal of driving eCommerce
Expert Market Trend #1: Consumer online shopping and purchasing for premium brands; eCommerce and DTC for premium brands
Consistent with Buy Buy Baby’s 50%+ reported online sales, both experts we spoke with estimate that eCommerce drives more than 50% of baby gear purchasing among first-time parents in the market for premium baby gear.
These industry experts and first-time parents that we spoke with estimated that the upper limit may be as high as 90 to 100% of premium baby gear purchased online in the relatively-near future.
“The most important trend is the direct to consumer (DTC) trend. Whereas 10 years ago, only a tiny handful of premium vendors would go direct to consumer, now it’s almost everybody. What hasn’t changed is that first-time parents have an experience of overwhelm and confusion and nothing prepares the expectant parent for ‘I’ve never bought a stroller before.’”Eli Gurock, CEO, Magic Beans
“The generation of shoppers today, Millennial and Gen Z, is more natural to shop online. They want to be empowered to do their own research, and if they want to talk with someone to reach out and chat. This consumer doesn’t need to walk into a store, they can do all their research from the comfort of the couch. The goal of our new website is to allow the customer to get all the information they need in the way they prefer.”Charlie Birnbaum, COO, Pish Posh Baby
Reviewing groups for parents online shows that members often reach out to each other for advice, recommendations and friendly debate.
Expert Market Trend #2: Online premium shoppers seek curated experiences and unbiased advice from retailers
According to these experts, retailers are expected to provide unbiased advice across different brand choices, and even among different products from the same brand. This advice can come in the form of online blog posts, YouTube videos and various social media channels.
Premium consumers favor sites and stores that deliver a curated product set within an environment that allows them to get the information they need.
“Consumer can’t get a good competitor comparison from a manufacturer site. The manufacturer can’t make that recommendation. The nice thing about a specialty retailer is we have credibility to compare them. One of the biggest values I bring in Magic Beans YouTube channel and store is that we compare UPPAbaby model with Nuna model (for instance).”Eli Gurock, CEO, Magic Beans
Here’s the example video Eli mentions:
“Traditionally, in the premium market, the premium brands did not want to see their products online as they thought it was flea market. The eCommerce world now has created a boutique feeling with curated products.”Charlie Birnbaum, COO, Pish Posh Baby
Here’s an example of the boutique branding Charlie ensures at Pish Posh Baby, which features custom photography that gives the sense of luxury and nurturing.
“I buy baby gifts from sites that look well curated. I have ordered gifts from thetot.com. For a baby gift, I want to show more effort. I wouldn’t order a baby gift from Amazon. On the luxury apparel, like kytebaby.”Premium Baby Gear Purchaser, Los Angeles, CA
“Consumers value advice from unbiased sources, like independent retailers. Over the course of the pandemic, we began charging for consultations. People come into the store, or we do a virtual consultation online. We charge $50 for a 45-minute consultation. At the end of consultation, they receive a $50 gift card. One thing that happens in the baby industry is that people may be shopping weeks before they are ready to purchase, for instance shopping at 32 weeks and then decide to purchase or have a baby shower at 37 weeks.”Eli Gurock, CEO, Magic Beans
Expert Market Trend #3: Supply chain disruption
These industry experts noted that supply chain disruption has caused them to adapt their approaches. NBC News also reported on this trend with examples from Pish Posh Baby and Strolleria. One example cited was to encourage consumer to buy earlier (i.e., not delay from 32 weeks to 37 weeks) and to be alert for out-of-stocks.
“I don’t see the supply chain problems slowing down any time soon. It will be well into 2022 for sure. We are getting in touch with the brand and instead of the product shipping to the distributor, we are taking care of the forwarding, to ship it and be more efficient. We did a bit of this for three or four years prior to the pandemic, so we expanded it. We place a large order and take care of the forwarding. The costs to import a container used to be $2,000 per container and now it can cost more than $20,000 per container. “Charlie Birnbaum, COO, Pish Posh Baby
“Supply chain disruption is probably temporary, but is a long temporary. The main difference is that the supply chain in America was so efficient with just-in-time inventory that moved so rapidly, there was no need to hold much inventory. When the supply chain problem hit, it was a shock.”Eli Gurock, CEO, Magic Beans
These three market trends identified by baby gear market experts are likely playing out in other categories. For more information on customer segments and market trends, visit our resources page. Or join us at an upcoming office hours.