David Niggli, Chief Merchandising Officer, FAO Schwarz, discusses the iconic retailer’s growing partnership with Target, its plans for expansion, and predictions for the future in this extended edition of The Toy Book’s 2023 State of the Industry Q&A roundtable. Want more insight from the all-stars of the toy industry? Click here to explore this year’s lineup!
The Toy Book: FAO Schwarz was back in the mainstream in a big way last year. How did the expanded partnership Target partnership perform last year and how will it grow in 2023?
David Niggli: 2022 was a historical year for FAO, as we celebrated our 160th anniversary with a birthday celebration takeover of Rockefeller Plaza, and the City of New York declaring Oct. 8 officially as FAO Schwarz Day. We saw great success in our New York City Rockefeller Plaza Flagship location throughout the year, seeing customers from across the globe returning to New York and making sure their trip included a visit to our iconic store. Sales and average transaction values were all above pre-COVID levels, with our guests thoroughly engaging in our demonstrations, experiences, and the best specialty toy brands from all over the world.
Additionally, our Target partnership was very successful across multiple categories, and I am happy to say that we will be expanding in 2023 and beyond. We are thrilled to bring FAO Schwarz to the biggest audience in the history of the company by way of our presence at Target stores nationally.
TB: What were some of the additional big wins for FAO last year — are there any specific products or categories that performed particularly well?
DN: We focused this year on bringing unique design languages to our key categories. Plush continued to be strong, with great success in our Adopt A Pets and Glow Brights collections. Our FAO-abulous fashion role-play and activities collection continued to grow in popularity with makeup cases, a fully stocked vanity, and trendsetting role-play handbags being among the top-sellers. Creativity was another key category, taking classics like a potter’s wheel and updating it with a contemporary, yet classic design approach, and our wood and preschool items also gained momentum.
TB: Prior to the pandemic, FAO was opening new stores internationally and had spread into airports in the U.S. What is the status of new store openings?
DN: We currently have stores in England, China, Ireland, and Italy, and airport stores in LAX, LaGuardia, and Norfolk. While COVID did impact some international store openings, we continue to create plans to increase our international presence over the next few years via new store locations and by growing our international wholesale distribution.
TB: How does Toy Fair moving from February to September impact your business, and what’s your take on the trade show shift?
DN: Overall, the move does not really affect our business. We work with our vendor and retail partners throughout the year, so whether it is February or September will not make that much of a difference. We did enjoy having Toy Fair take place in February as it provided a great opportunity to check in at the beginning of the year, but the move really won’t impact us. We are excited for Toy Fair [in New York] to return later this year and reunite and celebrate with the industry.
TB: What are your overall predictions for the state of the toy industry and toy retail this year?
DN: There are numerous challenges facing all businesses today, and as we all have learned over the last several years that change can happen overnight. Fortunately, in these uncertain times, brands like FAO Schwarz, that have such a great history and continue to bring magic to our customers and to create memories across generations, become even more relevant. That being said, we will continue to focus on creating products that celebrate classic play patterns, innovative designs, and great quality.
The legacy of our founders to bring experiences and theater to all of our channels of distribution is as important — and maybe more important — as it has ever been in our 160-year history. In our 161st year, we look to bring the wonder of FAO Schwarz to our flagships, Target and target.com, fao.com, and with our international wholesale partners through exclusive products and experiences, and to be the best in class in creating engaging theatrical environments. We are very excited for the next 160 years!
A version of this Q&A was originally published in the 2023 edition of The BIG Toy Book. Click here to read the full issue! Want to receive The Toy Book in print? Click here for subscription options!
