Olesya Perepelitsa: designing a product from scratch is a very interesting task
FIRST STEPS® is well known in the industry as an experienced team successfully developing its wholesale and promotion of famous brands of toys in Russia and the CIS on exclusive basis. We talked to Olesya Perepelitsa, the company Marketing Director, about perspectives of work with licensed brands and about creation and promotion of own brands.
“You are working much with licensed brands. How do you evaluate the future of this activity, in particular, the Russian brand licenses?”
“We are always strongly in favor of licenses. However, we try to choose the kind of product which we’ll sincerely trust. In fact, we have been working with licensed products since the foundation of our company. The success of a licensed brand depends on many reasons; and in our opinion, we can’t say definitely that foreign brands are more successful than Russian ones. Children watch different kinds of cartoons with the same pleasure. For us, since we are a commercial company, it is important that the license with which we work to be exclusive in the category that we produce. We are interested to develop it and promote, and enlarge the product range. If the license is not exclusive and is sold to several companies, we are not interested in such a competition.
“The license for Chuggington® was one of the first projects we successfully carried out. In order to have the license commercially successful, it is not enough just to believe in the product; it is necessary to promote it by all means: to hold various festivals and make parties, arrange activities with license characters, make all kinds of promotion, and decorate designated sales areas in retail. You have to enter a TV channel with high rating with a good frequency in prime time, not only with a cartoon, but also with advertising of the product that you plan to sell in large quantities. Besides, you have to check on a regular basis the data of various agencies to analyze whether the license is growing in order to correct your plans on the brand. Being a manufacturer, we are also interested in making products which have information support besides production of our own goods.
“However, it works well only when you present a licensed brand on an exclusive basis in your category, and when your category is leading, and does not represent, let’s say, just 10 per cent of the business. This must be the major category of the business, and then it brings interest and gives a perspective future.”
“You parted with Sylvanian Families®after many years of cooperation…”
“It happened after the brand owner, Japanese company Epoch, had taken a decision to open its Representative Office in Russia. This, I think, proves, first of all, that we had worked successfully since such a closed company believed in the Russian market, and decided to enter it, and is doing fine now.”
“What instruments do you use to promote your brands?”
“From the very start our company carries on an active marketing policy making use of the best promotion channels. These are articles in profile media for parents, and TV advertisement, and Internet advertisement, and a lot of work in the social media. Mothers today are very advanced, they are actively and very attentively studying the market, and sometimes they even know more about the product than the product designers! We take this into account and try to communicate with them in a professional and confidential manner.
“We have been always active in our brands promotion, however, as you know, at present the situation has changed: former instruments became less effective, and we accepted the new game rules. Unfortunately, the “tired customer” now reacts only to discounts. All that we can notice now are “Black Fridays” and “Black Tuesdays”, autumn and spring season discounts, 2+1, 1+1, and sales of all kinds. We have to support all that, we are forced to play according to the new rules of today.”
“Last year demonstrated the birth rate decline, did your sales results change?”
“We, as the whole market, of course noticed a certain decline in sales; customers changed their purchasing approach. One can see it in all product categories. However, we work in a fast changing industry, and, it is quite possible that by the end of this year the situation will change to opposite.”
“What products of your company represent the driving force bringing a stable profit?”
“Several years ago, when another crisis came to our country, we understood that successful sales of the world’s famous brands are fine. However it was time to start selling our own brands. And we started to develop our own brand: we worked out an idea, developed the concept, the design, and started production. Now it sounds so simple, though it is not easy to organize manufacturing in Russia, indeed! Those who know will understand what I mean. To design a product from scratch and to start its distribution is a very interesting task. It is much more interesting since it is fully your own baby. Today we have two brands of our own YaIGrushka® (table games, toy arms) and One Wonderful Morning® (doll houses and furniture, and wall paper and home textile for the doll houses). Almost from the very start we noticed a big interest from the customers, and the sales have been fine the whole year.”
“What are the plans of FIRST STEPS® for the season which seems to be not quite stable?”
“We are not going to make sudden abrupt movements. Evaluating the volatility of the market, we try to be more flexible, we are constantly making small changes; we introduce something, and we withdraw something. We understand what categories to add. We start, for example, to further develop YaIGrushka® table games. At present we have seven product items, and we’ll add more items step by step. We have credit to this category, and we know how to do it correctly. We placed a bet on design and natural materials (we like wood very much) and we remember to add a bright and catching idea to each game. Without that the game has no chances to become popular on such a competitive market. A large team is working on that: children's artists, game designers, teachers and psychologists. We’ll be working on expanding production of the table games. We also center our hopes on the products for girls of One Wonderful Morning® collection, we enlarge our product range; we produced new colors, new wall-papers and hosiery. Thus, our main focus is still on our own brands. We put our hearts and souls into them, we use a lot of natural materials which are very warm and positive by their nature. By the way, for an unexplainable reason, all our projects are born in exactly 9 months like a baby! We did everything to accelerate this process, but anyway, it takes 9 months from the idea to the first production. There’s something magic in it, in our opinion! Maybe this is the key to our success?”