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Author: VegasRaab Two stars, 250 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 319  
Subject: Re: The Cult of Instant Gratification Date: 12/30/2003 10:36 AM
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It was the same at my local Meijer in Indianapolis. I took it as a positive sign though. LeapFrog has now in the last year "earned" the right to have a TON of shelf space, at Meijers and other places. My wife informed me that the LF display a few weeks ago was disorganized and messy. It appears that Meijer management has corrected this. The amount and variety of LF toys was comparable to Toys R Us. Did you happen to see the PowerTouch display? At my Meijers it was puny and appeared neglected. Retailers love LF products because their pricing power is strong (few discounted products).

Go to Amazon.com click on the "Top Sellers" link for toys and games and you'll notice that right now 11 of the top 15 toys are LeapFrog. What's more you'll notice that none of those toys are discounted. Amazon has the Leapster "on sale" at 11% off, but 79.99 (not 89.99) is the full retail price, so that's Amazon marketing.

I truly believe 2004 will be a banner year for LF. Here is why.

- Sales of leapster games should pick up as many kids will want new games for the leapster they got for xmas, and the toy is still very "hot". Leapster games are HIGH margin items. They are just little plastic cartridges with a chip inside, in a little cardboard box. Huge margins = Huge profits. Currently all the leapster games are top sellers at amazon. Mr. Pencil has been #2 for the past few days. The Leapster case is the #1 selling "toy" at amazon!

-regular LeapPad books are STILL selling well. My First Leap Pad and Little Touch are doing well also. The only stinker I believe is the "Plus Writing" pad which doesn't appear to be selling that well, although it gets good reviews.

-weak competition, sure Power Touch sales make a dent into LeapPad sales, but if you look you'll notice that most stores overstocked Power Touch, and that they did not sell well, and now can be found regularly for 20-30% off. The book library is very small as well. The other "competitor" Learn through Music languished in relative obscurity. I never saw it on the top sellers list on Amazon for all of December. Kasey the Kinderbot has been discounted heavily, and the cartridges were largely unavailable (I know we hunted for the Spanish cartridge for months!). Pixter? strong competition as its half the price of the Leapster, but the Leapster is simply much better, don't believe me? try them both and get back to me. Video Now is sort of a competitor, but is certainly not a learning toy. The other "educational toy" company that I think is a small threat is neurosmith, but they've been around longer than LeapFrog, and they've not grown. They never had a hit toy like the LeapPad to propel them like LF.

So in summary I wouldn't worry about Meijer having fully stocked shelves and a massive amount of shelf space for LF. I think Meijer just didn't react quickly enough. If they would have been smart they woulda had that kind of display before xmas.

-VegasRaab
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