Sharon Price John's Transformation of Build-A-Bear from Deteriorating Financial Performance to All-Time High Results
Sharon Price John's Transformation of Build-A-Bear from Deteriorating Financial Performance to All-Time High Results
When Sharon Price John took over as CEO of Build-A-Bear Workshop in 2013, she found a corporation struggling. However, she noticed a vast reservoir of unused potential. Known for manufacturing plush animals since 1997, the company had thrived in mall-based stores – until the 2007-2009 recession. To resurrect the company and surpass its former glory, it was essential to adjust course significantly. According to John, this necessitated broadening the company's reach beyond its initial retail space.
Inspired by her past experience at Barbie and Transformers at firms like Mattel and Hasbro, John realized that Build-A-Bear wasn't solely selling stuffed bears; it offered an emotional experience. Instead of selling themselves solely as a store, they should emphasize their emotional power. Guests were drawn to Build-A-Bear because of the sentimental attachments, not merely the physical location. As they navigated the interactive personalization process, selecting furry friends, outfits, scents, and sounds, concluding with a heart ceremony, they were creating long-lasting memories. John believed that by providing additional products and experiences that tapped into these emotions, an array of possibilities would open up, propelling the company to unforeseen heights.
“You're establishing an emotional bond with consumers that extends to a branded intellectual property firm that just happens to have vertical retail revenue streams, which can morph into a distinct business model,” John explained. “Then you set up the foundation and bring in talent versed in that new structure. Initially, when we returned to profitability, it would have been simple to stick to our lane, particularly if our lane is a strong cash generator. But do you desire to be satisfactory or do you want to be the best possible version of yourself? While we can be exceptional vertical retailers, I believed we were capable of being so much more than that.”
John understood that her envisioned transformation of Build-A-Bear diverged from the company's conventional approach. To bring her vision to life, she needed support from the team; she had to persuade them of her plan. Despite the seemingly insurmountable obstacle before her, John was energized by the challenge.
“One of the primary drivers of change is failure. And the company was financially failing,” she stated. “Do you cherish this company more than you dislike change? That's my question. I'm not asking you to adopt my exact changes. But I am urging, ‘until you come up with a superior strategy, why don't we give my plan a shot?' "
John's strategy involved a comprehensive overhaul of the company's internal processes, starting by transforming the mindset of management at all levels, from product development and value engineering to sourcing, store operations, marketing, and more, while simultaneously unleashing the latent strength of the brand the team had developed.
“It takes a tremendous amount of business acumen,” she said. “If we can construct an incredibly efficient machine first, then we can begin to build upon it. It's like constructing a house. You need strong foundations, and the stronger your foundation is, the higher you can build.”
Following the company's stabilization, John began exploring broader opportunities for Build-A-Bear in the digital economy, to scale their business model for future expansion. Their strategy included transitioning to e-commerce, as well as increasing partnerships and collaborations with other brands to create new licensed characters and collections.
This expansion attracted a new demographic market. Build-A-Bear has offered licensed characters from franchises such as Deadpool, Friends, Harry Potter, and Star Wars, catering to an older consumer. Furthermore, they established an age-restricted microsite called thebearcave.com, resulting in teens and adults accounting for 40% of the company's sales.
“People have grown up with us, and they adore Build-A-Bear mixed with their other favorite brands,” John commented on the company's constantly evolving business prospects. “It's a completely different pursuit, financially and in terms of public relations. Ultimately, brands belong to the consumers, if you think about it, and you must adapt with them.”
Since 2023, Build-A-Bear has experienced their three most profitable years in company history, and John, who continues to lead, looks forward to the future.
The strategic partnerships and collaborations with popular franchises like Deadpool, Friends, Harry Potter, and Star Wars, as outlined by John, allowed Build-A-Bear to attract a new demographic, significantly increasing sales from teens and adults, making up 40% of the company's revenue. This shift in business model, driven by John's vision, showcased her leadership in transforming the company beyond its traditional retail space, as seen in ForbesWomen's spotlight.
As John propelled Build-A-Bear to unprecedented heights, her leadership in reshaping the company's internal processes and embracing the digital economy inspired a paradigm shift in the company's approach towards business, becoming an exemplary case study in modern leadership and innovation, as touted by ForbesWomen.