Cupboards becoming bare for toy e-tailers

Shopping for toys online may save the hassle of going to the mall, but online toy retailers already are running out of popular items--just like their brick-and-mortar competitors.

3 min read
Shopping for toys online may save the hassle of going to the mall, but it may not be any more satisfying.

Online toy retailers including eToys and KBkids.com already are running out of popular items related to Pokemon and Furby. Leading e-tailer Amazon.com is also having a hard time keeping perennial favorites in stock, including Matchbox cars and Lego sets.

These shortfalls in inventory could mean some disgruntled consumers.

"Consumers are going online because of the promise of great selection and almost limitless inventory," said Mike May, Jupiter Communications digital commerce analyst. "They're absolutely going to be disappointed if they don't find what they want."

The inventory limitations these sites face compound recent technological problems at many of the leading online toy retailers. Last month, Toysrus.com's site became inaccessible for many consumers after experiencing heavy traffic as a result of an online promotion. Amazon also suffered at least three outages earlier in the season.

Lack of inventory and insecure technology may dampen what industry experts expect to be a record-breaking online shopping season, as millions of consumers buy online for the first time. Forrester Research estimates that 8.6 million households will shop online this holiday season, spending some $4 billion, up from $1.5 billion last year.

Toys, in particular, are among the most popular shopping picks online. Forrester projects that consumers will buy about $253 million worth of toys online this year, compared with $80 million last year. About 40 percent of that amount will come exclusively during the holiday season, according to Forrester.

This is why it becomes crucial for online retailers to stock up.

eToys, for instance, lists about 140 different Pokemon toys. But as of Click or miss Friday, the Santa Monica, Calif.-based toy retailer had only about 100 of those items in stock. Visitors to KBkids, the Denver-based online affiliate of the KB Toys retail chain, could not order at least 11 of the 92 Pokemon items listed there.

Meanwhile, of the 198 Pokemon-related items listed on Amazon, about 112 of them were not available today.

Gomez Advisors analyst Liz Leonard said that one of the reasons the toy retailers may be running out of items is because of their relative inexperience. Amazon launched its toy store in July, and KBkids debuted its site that same month. eToys, the veteran Web toy store, has only been selling online since 1997.

"Experience really makes a difference," Leonard said. "If you had the experience, you would not just double up stock [on popular items], you'd know that you'd need to have 20 times the amount on stock."

Amazon in particular seems to be struggling with its toy inventory this holiday season. In addition to the shortfall on Pokemon items, the site is running low on other popular toys such as Furbys and Amazing Ally dolls. Of the 138 Lego items Amazon lists, about 50 were either out of stock or on back order. And of the 109 Matchbox products Amazon sells, about 42 were out of stock.

"You have to question how seriously consumers will consider them as a site to buy toys," May said. "You could forgive them the Pokemon and the Furby, but these are toys that are popular every year and should be available at the 'Earth's biggest selection.' "

"The great challenge of this time of year is balancing inventory so that you can meet people's needs in a swift manner, and occasionally, like any place else, we'll run out of items," Amazon spokesman Bill Curry said.

Representatives at eToys and KBkids said they are replenishing items that they have sold out of, many of which they intend to carry again before Christmas. eToys, KBkids and Amazon all include a feature on their sites that will alert interested consumers once an item comes back in stock.

eToys spokesman Jonathan Cutler said the company has been preparing for holiday shopping this season since the end of last year. "By and large, we have what consumers want," Cutler said. "Of those that are out of stock, many will be back in stock shortly."

Despite the problems with online toy retailers, consumers may fare no better at their offline counterparts. A CNET News.com survey of several traditional toy stores in the Bay area on Friday revealed that none held in stock the Amazing Ally doll, the Pokemon yellow special Pikachu edition game for the Nintendo Game Boy, or the Easy-Bake Kitchen Playset on CD-ROM. Other hard-to-find items included Furbys and the Chuck E. Cheese pizza factory.