Stokke chief executive Jacob Kragh speaks to Retail Week about his M&A plans, store strategy and where he sees the next phase of growth
Norwegian retailer Stokke sits in an enviable position within the nursery category. The brand’s premium standing has seen its products positioned as a staple in UK stores like Harrods, Selfridges and John Lewis, and it shrugged off the economic challenges of the past year by posting record sales in 2022.
Former Lego Education boss Jacob Kragh has been leading the brand’s global expansion and acquisition spree, which has seen it snap up pushchair brand Babyzen, famed for the celebrity favourite Yoyo stroller owned by stars from Kim Kardashian to Chloë Sevigny.
Kragh speaks to Retail Week about his M&A plans, his store strategy and where he sees the next phase of growth.
You acquired Babyzen two years ago, how is it bedding in? And how do you balance its growth with maintaining its reputation as an iconic, cult-classic brand?
“There is this balance to strike in terms of making sure that we are protecting the core of the brand and the brand DNA – which is all about being an urban mobility stroller. That means we’re not going to try and position it as a stroller that does everything for everybody.
“It’s about liberating families that still want to have an active urban life. I think what the people that started the Yoyo had done exceptionally well is to make sure that lifestyle became aspirational, and I think it was really picked up by certain groups that are potentially more influential than others, like the first people to buy the product in Paris. We’re trying to make sure that we are promoting that lifestyle around the brand in other places as well.”
Are you looking at further acquisitions to bring you into new categories?
“We did acquire a German carrier brand, which we’re now bringing into other markets and it’s a good example of us saying: ‘Here’s an interesting category, we know there’s a lot of potential in that category and we would like to find a way to access that’, and doing so through an acquisition.
“We are using acquisitions activity to look for new opportunities, but the point is we’re not depending on that. We like to think of ourselves as having a strong portfolio that can grow organically.
“In the M&A space you can’t sit down and say, ‘OK, let’s buy a car seat manufacturer’ if there are no relevant brands up for sale. That’s not how it happens. You have to time it right, but we are constantly on the lookout, we will continue to monitor the market.”
Stokke stores are run primarily by retail partners, why do that instead of operating them yourself?
“We have a few stores in select areas. One in London and in big cities like Milan, Seoul and so on. But typically they’re partner driven because we believe in having retail experts to support us and drive them.
“Of course, to consumers they’re going to look like Stokke brand stores and we believe that’s an important part of it – we love envisioning a big global network of stores where consumers can come in and get that more in-depth experience about what the brand offers.
“The retailers that we work with are obviously limited by the fact they have to sell many different brands, many different products, and they cannot dedicate themselves 100% to your brand and to the product. So having partners has been beneficial.”
Would you ever open an experiential flagship?
“It’s not on the drawing board right now. We’re quite happy with the way we can work with partners around us. And I think to a large extent the ambitions that we have are actually covered by the partners.
“When we do visit those stores, or when consumers visit those stores, they’re getting a great experience. We don’t necessarily see that there would be huge value added from us.
“Remember when Nike or other brands open their flagship stores, they’re not always the most profitable store. It can of course look very nice and give a fantastic experience, but your gross margin return on investment might not be produced.”
Where are the opportunities for growth in the coming years?
“There’s no doubt that with the acquisition of Babyzen, we’ve made some significant inroads into the stroller category and I think that’s an area we would love to explore more but there’s heavy competition.
“We know that there are many brands out there and so we need to stay on our toes, but I can really imagine that this is going to be an area we’ll continue to focus on.
“We will never forget where we come from, with highchairs, so that part will always be an area where we spend a lot of time and energy in terms of developing.”
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