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Can toy stores create Toys 'R' Us kids in an Amazon world?

Stefanie Dunlop, owner of two Learning Express Toys chain stores in Tampa and Clearwater, helps customers at the Learning Express Toys store inside the Westfield Citrus Park mall in Tampa , FL, on Tuesday, Nov. 21, 2017. As more people turn to online for their toy-shopping, businesses from big corporate stores to smaller chains to independents are doing what they can to stay in the black. Gabriella Angotti-Jones | Times
Published Nov. 23, 2017

Stefanie Dunlop is pinning high hopes on her Fingerlings.

Cute, robotic creatures that interact with their owners, they are this year's white-hot Christmas toy, the Furbys and Hatchimals of 2017. On this weekday in Clearwater, Toys 'R' Us and Target had zero in stock.

But at her Learning Express store at Westfield Countryside mall, Dunlop had about 70, marked up $10 from the suggested retail price of $14.99. A sign warned of a two-per-customer limit, with a smiley face chaser: "We appreciate you shopping local."

"A lot of stores have had a difficult time getting them, but we've had our orders placed and they're coming over," she said. "All the big-box stores, everybody's struggling with their inventories."

The key words there: Everybody's struggling.

Traditionally, Christmas is the most wonderful time of year in the toy business. But toy stores are struggling mightily in 2017 as more parents outsource Santa's work to Amazon.

Toy sales at brick-and-mortar stores have decreased from 85 percent of the market in 2011 to about 55 percent in September, according to Klosters Trading Corp., which tracks the toy industry. That month, Toys 'R' Us filed for Chapter 11 bankruptcy, with experts anticipating store closures after the holidays. Sears — whose annual Wish Book was once every child's holiday bible — has shuttered more than 350 Sears and Kmart stores this year, with dozens more closing by January.

The Crayola's on the wall: Toy shopping has changed since you were a kid ogling snowy storefront displays, and maybe no amount of Christmas magic can change it back.

• • •

Kate Kyers has heard all this before.

For nine "topsy turvy" years, Kyers has owned Silly Dilly's, an independent toy boutique in South Tampa. Her shop, whose business is about half toys, is among the few that have survived.

You have to sell a lot of toys to make up the cost of the store, she said. And it's still not enough to compete with the Internet. Specialty toy lines once prohibited products from being sold on Amazon, eBay and other sites, but that's changing. In the past three weeks, Kyers said, three European makers have said they will no longer ship their goods to American stores because online prices have gotten so low.

"They refuse to have their brand and product cheapened," she said. "One wooden toy company simply stopped manufacturing."

Over five-plus years, St. Petersburg's Growing Up has actually increased its toy inventory, said manager Tara Gill. Her customers, she said, have shied away from electronics, moving toward imagination.

"We carry stuff that you can't really go to Target and grab," Gill said.

Growing Up has a play area where children can try toys they want to purchase. The shop is active on social media, particularly Instagram, where Gill said almost any toy she posts is sold the next day.

"Parents, especially millennial parents, are much more apt to buy into an experience rather than buy into a product," she said.

The Learning Express has more than 100 franchises across the country, often in high-traffic areas like malls. It sells specialty products and mass-market lines like Lego. But its stores operate more independently than, say, Toys 'R' Us, giving local franchise owners more influence.

At the same time, big box stores are taking a cue from the little guys.

The same month it filed for bankruptcy, Toys 'R' Us unveiled a new slogan, "Today We Play," with initiatives designed to reimagine stores as interactive zones. This includes a new smartphone app featuring in-store games and augmented-reality experiences. A pilot program called "Play Labs" expanded into 42 stores nationwide, including all eight in Tampa Bay.

At the sleek Citrus Park store — which also has an Instagram account, albeit with a quarter of the followers of Growing Up — the Play Lab has a rotating selection of cars, blocks and games for kids to try. Among the toys out this week: Hasbro's Roarin' Tyler the Tiger, a robotic plush cub pegged as one of this year's hottest toys, not likely found in a mom-and-pop.

"We have kids that are here all the time that come in and check out what we have going on this week," said store manager Jessica Martinez. "It's not just about, 'Oh, there's toys, I want to go in there.' Now it's about, 'I want to go in there and play.'?"

After discontinuing its Wish Book in 2011, Sears revived a smaller version this season — mostly in digital form, and with a greatly reduced emphasis on toys — after realizing how much nostalgic weight the brand still carried. The digital catalog, also available on Sears' app, allows customers to create a wish list similar to Amazon's.

"It's important to us to deliver exactly what the members want," said Sears and Kmart chief marketing officer Kelly Cook. "Please de-stress it for me. Please make it easy for me. Please have what my kid wants."

Shifting online does have drawbacks for big-box retailers, said Lutz Miller, owner and CEO of Klosters. A huge percentage of toy sales at stores are impulse purchases, where a child can be seduced by packaging or placement, and the parent gives in. If busy parents shop online, after the kids go to bed, a lot of those sales go out the window.

He's also skeptical of Toys 'R' Us' rebranding effort and Play Labs.

"It's an idea probably by an elderly bachelor who hasn't had 2-year-old children, and probably doesn't have a clue what mothers of 2-year-olds are willing to do and not willing to do."

While Toys 'R' Us is in the midst of its annual seasonal hiring spree — 2,500 workers in Florida, including more than 400 in Tampa Bay — once the holidays are over, Miller expects them to close between 5 and 15 percent of their stores.

But he's not completely bearish. Toys 'R' Us, he said, has actually increased its share of the toy market since 2011. It has the capacity to work with vendors to offer perks Walmart, Target and indie shops cannot. He stopped into Toys 'R' Us the other day.

"Whatever implications there were, or are, because of Chapter 11, I don't think the consumers have heard about that," he said, "because they sure like hell came in and bought."

• • •

Even if her Fingerlings are gone this weekend, Dunlop is not too worried. She has 3,000 more arriving by air next week.

"You still have those people wanting to go out and shop, wanting to find those deals," said Dunlop, who also owns a Learning Express at Westfield Citrus Park. "That hasn't gone away, and I don't think it's ever going to."

As Dunlop unpacked crates of Pikmi Pops behind the counter of her Citrus Park store, parents and children popped in. Some walked in with Christmas lists and out with Peppa Pigs. Others browsed, poking Simons, chucking Doinkit Darts and sculpting piles of Mad Mattr and Floof. Toy stores may no longer be in vogue, but there remain few better places for families to kill time.

After photos with Santa, Cindy Alexander came in with Andrew and Noah, 8 and 6, two brothers she was sitting for a friend.

"I definitely want that!" said Andrew, pointing to a Strato-Slam Rocket.

"I want this so bad!" said Noah, tugging at a Skyrocopter.

"I definitely want this!" said Andrew, grabbing a Socker Bopper Bubble Bopper Ball.

Alexander lifted her smart phone and surreptitiously snapped a few photos.

"I'm getting ideas," she said.

Her own kids are grown; long gone are the days when she did all their shopping at Toys 'R' Us. These days, she likes browsing in person, but prefers the convenience of shopping online.

As the boys busied themselves with a Thomas and Friends train display, Alexander scrolled through the pictures. She planned to go online later and check prices. They walked out of the store empty-handed.

Contact Jay Cridlin at cridlin@tampabay.com or (727) 893-8336. Follow @JayCridlin.

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