Digital commerce for kids is not a new idea – a fact that any parent can attest to after paying off a four-digit credit card bill generated nearly entirely by their offspring’s affinity for in-app purchases. Children in recent years have proven to be some of the world’s most convertible consumers when armed with a connected device embedded with their parents’ payments credentials.
But controlled kid commerce – the type that parents know about and set up as opposed to being horrified by when the bill comes due – is a horse of a different color, one that the team at New York-based toy retailer Camp NYC Inc. believes it can build. Starting on Monday (May 24), the retailer will launch what it’s calling the Present Shop, an eCommerce introduction designed to let kids as young as three years old shop for gifts and check out with minimal adult oversight.
Parents and other adults in a child’s life can set a budget on Camp’s website, designate the recipient and fill out shipping and payment information on behalf of their pre-literate offspring. Camp then sends the adult a one-time code and link that children can use to do their own shopping.
Because, as we all know, three-year-olds and minimal oversight is historically not a good combination.
The idea of pursuing a younger market is not exactly new – Amazon has been pushing eCommerce to minors since 2017, but its focus has been on teenagers, particularly 13- to 17-year-olds. Targeting pre-schoolers, however, is something of a new idea. According to Ben Kaufman, Camp’s co-founder and CEO, it’s really just a modern take on slipping a kid a few bucks before turning them loose at the local mall.
“We feel like that system has always existed in the real world of retail, but it’s never existed in the world of eCommerce because of all the complexities,” Kaufman told The Wall Street Journal.
Even the most mall-nostalgic Gen Xers and bridge millennials out there – who spent the majority of the late 80s and early 90s at shopping malls – would likely concede that their “mallrat” careers didn’t start when they were toddlers, and that their parents weren't likely to hand them money and set them loose when they were younger than 11 or 12 years old. And Present Shop is definitely designed for younger kids, with an animated bear called Scout acting as a guide for the little consumers, and a “coin counter” at the top of the page that represents the funds still available to the child for use.
So pitching commerce to minors is not exactly a new idea, but redesigning the journey end-to-end for a class of consumers who may or may not be fully potty-trained is certainly a novel concept.
And it’s one that is far from universally beloved.
“[Camp’s Present Shop] goes to a place that is increasingly happening in this world, which is trying to get access to kids younger and younger, [to] develop habits and patterns, [and] disconnect them from parental or adult oversight,” said Nathan Dungan, vice chairman of Campaign for a Commercial-Free Childhood, an advocacy group said to be opposed to the upcoming offering.
Camp replies to those companies by asserting that the new feature is compliant with the Children’s Online Privacy Protection Act (COPPA), a federal law that requires websites to get parental consent before collecting data on children under 13, among other things. Once Camp has that consent, all the data it harvests is anonymous, the company said.
Moreover, the U.S. toy market was worth $25.1 billion in 2020, up 16 percent from the previous year, as parents sought to entertain their homebound children in a market without a clear leader since the fall of Toys R Us. Generalists Amazon, Walmart and Target have largely stepped in to fill the space, but perhaps the toy market needs some out-of-the-box thinking to set it back on track.
In fact, given that kid-friendly FinTech Greenlight recently snapped up a $2.3 billion valuation, perhaps the team at Camp are simply early riders of the wave of the future, working to create loyal consumers at the earliest possible moment. Perhaps we’ve only just begun to see innovation in marketing exclusively to consumers under the age of 10. Perhaps by the Fourth of July, we will see Elon Musk announce the launch of Kidcoin, the first blockchain-based crypto designed to make it easier and more efficient for parents to pay their children’s allowances.
Will kids be able to understand the blockchain technology underlying the Kidcoin, or the incredibly convoluted relationship between fiat and crypto, or how currency speculation works, or what to do when Kidcoin triples in value one day and falls by half the next, or how to manage the tax liability when they decide to tap their crypto wallet to buy some ice cream and comic books?
Probably not. But then again, there are adults who have literally made (and lost) hundreds of thousands or even millions of dollars investing in bitcoin with the same knowledge gaps, so it's not like children will be uniquely disadvantaged by not understanding cryptocurrency before investing heavily in it.
Or maybe, just maybe, there is such a thing as being a little too young to participate in the digital economy – and digital commerce is perhaps best reserved for people who, at a minimum, can read, add, tie their own shoes or sleep without a nightlight.