Retailers 'Sell'
to Young Virtually
Cheryl Lu-Lien
Tan
The Wall Street Journal
August 19th, 2008
Kohl's, Sears Build Brands As Children
Clothe Their Avatars Online
Retailer Kohl’s Corp. this month launched a new line
of apparel, but the plaid skirts and printed T-shirts
won’t be sold in its 957 stores. Instead, it’s selling
them on Stardoll.com, a virtual community for teens and
tweens where kids can fork over “Stardollars”—purchased
online at a nominal sum—to buy apparel for their online
characters.
With back-to-school sales off to a slow start, more
old-line retailers and clothing labels are reaching out
to kids online, enticing them to try virtual versions of
their togs in hopes of making actual sales later. Kohl’s
first virtual line features pieces from its new Abbey
Dawn collection, designed by singer Avril Lavigne. In
its first 16 days, Kohl’s Stardoll boutique logged some
2.2 million visits and sold 1.8 million items. Kohls.com
lured 97,000 visitors who clicked through from the
boutique site.
This month, casual-wear maker K-Swiss Inc. and
lingerie and swimwear designer Eberjey rolled out
virtual clothes on There.com. And in late July, retail
pioneer Sears Holdings Corp. opened its first online
boutique featuring back-to-school apparel and dorm-room
furniture on teen site Zwinky.com. Sears said the
boutiques logged 750,000 visitors and sold 850,000
virtual items during their first 16 days through
mid-August.
These mainline retailers hope the virtual showrooms
will be more effective than traditional ads in hooking
tweens and teens. Users of the sites already can spend
virtual dollars on virtual clothes designed by the
sites, or by early adopters such as American Apparel
Inc. that went virtual two years ago. The sites are
places to fashion digital personalities, called
“avatars,” that participants use to explore new styles,
relationships and behaviors. Typically, these sites now
offer a click through to buy the real products.
“When you look at an ad, it’s pretty quick,” said
Jennifer Weiderman, vice president of global marketing
for K-Swiss. “But when they’re in this virtual world,
this gets them to spend more time [viewing] your
product. It’s a little bit more sticky.”
Ms. Weiderman said she is dialing back her spending
on TV ads this year and expects to allocate 15% of her
marketing budget to online initiatives, up from 5% last
year. Sears and J.C. Penney Co., which last month made
virtual versions of its teen and young-adult clothing
available to users of Yahoo’s instant messenger service,
say they’ve increased online ad spending this year.
Kohl’s also said it is allocating more of its online ad
dollars this year to targeting teens. None would detail
the scale of the budget shift.
Details of the arrangements vary, but a retailer or
brand typically pays a fee to have a virtual community
host and develop its store and products. At There.com,
the fee ranges from a few hundred dollars to a few
thousand, depending on how elaborate the store is and
how many items will be sold. The brand and the Web site
sometimes split revenue from the virtual purchases. But
since virtual clothes cost from under $1 to $5—brands
regard this revenue as negligible.
“It’s really a way to get shoppers to test-drive your
product,” said Carlos Mejia, chief financial officer of
Eberjey, a maker of lingerie, swimwear and sleepwear.
The brand, which largely sells to women ages 20 to 45,
hopes to attract teenagers with its virtual line.
Penney decided this year to put back-to-school
outfits on Yahoo after learning that, during a
seven-week experiment last summer, 1.5 million avatars
wore its clothing on Yahoo and 5 million Penney outfits
were tried on. “It casts a very modern, current light on
the brand with teens,” says Mike Boylson, Penney’s chief
marketing officer. Before Penney’s presence on Yahoo,
“perhaps J.C. Penney wasn’t on their radar before,” he
says.
Sears is marketing its virtual boutiques on
billboards in the virtual world, and is hosting daily
fashion shows on the site promoting its products through
the end of August.
Not everyone is pleased. Patti Miller, vice president
of Children Now, an Oakland, Calif.-based national
children’s advocacy group, expressed concern over
marketing to youngsters via these virtual shops. The
Federal Communications Commission in 1990 established
rules governing the hourly amount of advertising
directed at children. But the newer, Web-based virtual
communities that have replaced TV viewing for some kids
have no similar restrictions.
“Some of these younger kids, those younger than 8 and
even kids up to 12, can’t make the distinction between
what’s advertising and what’s not,” says Ms. Miller. She
says children may not grasp that the virtual stores
function as a brand advertisement.
Dave Bazant, Sears’ marketing manager for online and
emerging media, argues that children who frequent the
virtual sites are savvy enough to know that the stores
also function as a branding tool.
“It’s fairly transparent—kids are not very naïve
these days,” says Mr. Bazant. He notes that Sears is
careful to not aggressively push its wares in these
sites because teens and tweens are “turned off by direct
advertising. We’re not giving away our product for free.
Most of these items, they have to purchase.”
The online pitches are striking a chord with Jen
Rediger’s daughters, 13-year-old Tyler and 9-year-old
Kenzie. In the first week that the Kohl’s store opened
on Stardoll, they spent about 70 Star Dollars, or $7, on
virtual skirts and shoes. Ms. Rediger, 32, an interior
designer who lives in Hoschton, Ga., says she doesn’t
mind her daughters being exposed to such marketing
because “it’s not worse than what they see on
television.”
Tyler has already asked her mom to take her to Kohl’s
to buy the real versions. “They look really cool on my
doll,” she says. “It’s my style so I think I’ll wear it
a lot.”
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