Grapat and the Evolving Market of Wooden Toys

Let’s get it out of the way – I love Grapat. Grapat makes up a huge portion of my daughter’s playroom. I love their ethos and what makes them Grapat. Their rich tones and vibrant colors resonate with me in a way I can’t accurately put into words. I love their story and how they came to be. 

I feel like I need to say this before I delve into the subject at hand because, as of late, my articles have been vilified in the wooden toy industry. At best they have been characterized as ignorant, and at worse, I was accused of being too American, too attached to capitalism, and too much of a stay at home mother to understand the inner workings of big business (laughs in MBA).

I say this all because I’m trying to get ahead of the nasty comments that I have come to expect every time I hit “Publish”.

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Grapat is a family business, one that has remarkable aims. I say remarkable because despite rapid growth over the past few years, they have kept true to what they envisioned from the beginning, creating beautiful toys with as minimal waste as possible, while continuing to follow the desires of their customer base. Before Grapat, a customer only had Grimm’s friends when it came to high-end wooden peg people. Grapat brought a fresh look, with colors that matched the interior of a sophisticated home, rather than a traditional polychromatic bright rainbow playroom (there is nothing wrong with rainbow playrooms – we have one). Grapat created toys that could be displayed as artwork, with earthy hues and rich wood grain. The founders of Grapat kept true to their vision of simple and basic toys that inspire the senses and left the heavy lifting to the child’s imagination. 

However, the wooden toy market is evolving, changing in an inexorable way towards a different target customer. As their customer base evolved and captured wider audience, Grapat found themselves responding to a global market, one that shopped internationally. Packages of desired Grapat pieces crossed the globe daily. From the UK to the US, from Japan to Australia, and back around again. Small wooden toy shops found themselves having to add international shipping options to their web stores. The audience had grown, but the production line and quantity of product had stayed the same. This a good thing – as the consistent product quality is one of the things most loved about Grapat.

In an effort to support their retailers, Grapat has made a decision to implement geo-fencing, a la Grimm’s announcement earlier in spring of this year. The decision goes into effect on July 1, 2020. While European countries are able to sell all over Europe, the Western Hemisphere will limit customers by country – problematic for those Americans whose favorite retailers are based in Canada. While the intention is to protect local commerce, the author sees this as not only bad for the customer, but disadvantageous for Grapat, who has not achieved quite the same market share as Grimm’s.

Let me explain: in the majority of wooden toy forums, Grapat has successfully inserted itself in to “The Three G’s”: Grimm’s, Gluckskafer, and Grapat. It’s a rare playroom that doesn’t have a favorite – and lately Grapat is it. This is a coup for Grapat and I would expect, a concern for Grimm’s.

And yet, Grapat has slowly started policing these same forums that helped spur some of their growth. B/S/T groups (Buy/Sale/Trade) have long been a place for Grapat customer resales, sometimes in partial sets, the original customer keeping only the pieces they felt they needed for their children. When the company releases six different desirable lines that have over 50 pieces each, it stands to reason that many playrooms can’t fit the entire set of each product. Several larger B/S/T forums have been asked to curb the sale of “splits” as they’re known. Full disclosure: the group I help moderate was asked such and we have complied by shutting down splits entirely. When it came to curtailing unauthorized Grapat retailers (private customers posing as legitimate stockists), most happily complied, but the effort also took a lot of power away from the consumer. If purchasing a $100 toy was out of the consumer’s means and they have no way to sell the excess to blunt the effect of the purchase, that’s one less customer, and that means less revenue, in the long run. 

These types of controls often result in much slower growth, a trade off for supposed “stronger branding”. Between the curtailing of splits and the geo-fencing, less consumers will own a Grapat toy. That leaves a lot of open space for a domestic (or otherwise) competitor to come in.

What does this all mean, Rachel? Where are you going with this? I started brainstorming this article not sure of my thesis – I couldn’t see the trees for the forest. The announcement didn’t hurt me in the same way Grimm’s announcement had, and I expect that it was because the first blow had dulled me to the second. I attempted to put the pieces together for their corporate strategy for the second half of 2020. I find myself concerned that the company I love, that V loves, is focusing too much on corporate policy and less on their customers. Someone told them that more direct regulations would result in a stronger brand, forgetting the grassroots effort that brought them to their position in the market to begin with. So, I leave you with this: You can have the brand loyalty of a loved and endearing startup or the heavy oversight of a large corporate entity – rare is the business that manages both.

What do you think about Grapat’s announcement? Comment below.