New Five Below stores aim at hot teen market

Five bucks: The Five Below chain targets hip teens and tweens with hot items that cost $5 or less.

April 27, 2004|By Andrea K. Walker | Andrea K. Walker,SUN STAFF

In the "Diva" corner is just about everything a finicky, fashion-conscious, teen-age girl would want: tiny purses, glitter nail polish, emery boards in holders shaped like matchbooks and tubes of lip gloss with slogans like, "Keep your lips greasy like a boy."

Everything costs less than $5, well in reach of a typical teen budget.

The Diva corner can be found at a new store for teens and preteens called, appropriately enough, Five Below. Its two newest locations, and first stores in Maryland, open Friday at Arundel Mills in Hanover and Golden Ring Mall in Rosedale.

The store is a throwback to the old variety store, but with hipper merchandise and stuff for the 18 and under crowd.

This is your granddaughter's five and dime.

Founders David Schlessinger and Tom Vellios are tapping a powerful undercurrent of retailing - the teen shopper. Consumers age 12 to 19 spent $175 billion in 2003, or an average of $103 per week per youth, up from $170 billion, or $101 a week, in 2002. That's according to Teenage Research Unlimited, a marketing research firm in Northbrook, Ill.

"Kids have a lot of their own money to spend and they like to make small frequent purchases," said Schlessinger, a retailing maverick who founded the educational Zany Brainy toy stores in the 1990s. As a student at the University of Pennsylvania in the 1970s, he also started Encore Books, which was later bought by Rite Aid Corp.

The fight for the teen market is intense. Five Below joins a number of stores that target young consumers, including Limited Too Inc., Spencer Gifts LLC and the accessories boutique Claire's Stores Inc.

As household disposable income has grown, teen spending power has captured the interest of marketers and merchandisers who employ hip techniques in movies, music and magazines to win their attention. It's why Mary-Kate and Ashley Olsen have become billionaire media machines by their 18th birthdays.

Like the minds of their clientele, the Five Below stores are busy and colorful. Big signs hang from the ceiling. Bins are piled with everything from pencils to basketballs to lava lamps.

A snack section offers "throwback" sweets such as Lemonheads and Sweet Tarts. Flip-flops hang along one wall, next to inflatable chairs. Lunch boxes, which many kids use for things other than carrying lunch, line shelves in the back.

Posters of teen singer Hilary Duff and Cleveland Cavaliers basketball player LeBron James go for $5. In other Five Below stores, kids have dubbed a part of the store the "gross out" section because of its selection of whoopee cushions and fake vomit and boogers.

The first Five Below store opened outside Philadelphia in October 2002. Friday's openings will bring the chain's total to 10, with plans to double to 20 stores by the end of this year.

"There's magic to a dollar store," Schlessinger said. "You go into a dollar store and it's like a treasure hunt because you feel like you can afford everything. Five Below is nothing like a dollar store, but it's got that same kind of magic."

The stores also allow kids to express themselves.

"Zany was about what the parent wanted the child to become," Vellios said of the previous venture, which sold high-end educational gadgets and went out of business last year. "It provided ways to help the parent stimulate the child's imagination. This is the opposite. This is where they can come and experience themselves."

Part of the idea for the stores came from Schlessinger and Vellios, a former Zany Brainy chief executive officer, who watched their own kids and noticed their constantly changing interests. Schlessinger has sons 12 and 8, Vellios has sons 13 and 10.

"Kids get older younger," Schlessinger said. "They reach a certain age and they're no longer interested in traditional toys. Seven-year-olds don't even like Barbie anymore."

Those familiar with the teen market said the challenge for Five Below will be keeping items fresh for the finicky.

"For them, it will be the collective mix of what they have and keeping it hot and trendy," said Cary Silvers, vice president for the Roper Youth Report from NOP World, a consumer trends marketing research and consulting firm in New York. "Fad often moves more than trend in this market."

Vellios said the stores conduct frequent surveys of shoppers and read teen magazines to stay on top of what's hot. The merchandise mix is constantly changing, he said.

"You can come in here two months from now and it will look totally different in here," he said.

By the numbers

$103

How much the average teen-ager spends per week.

2/3

Estimated share of teens with savings accounts .

5

5-year-olds outnumber 15-year-olds today.

47

Percentage of teen money that comes from parents; rest split between jobs, gifts.

$175 billion

What teens spent last year.

Sources: U.S. Bancorp Piper Jaffray, Teenage Research Unlimited

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.