Stroller Derby: UPPAbaby and the Battle for Sidewalk Supremacy

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S1: My name is John Ureter, I’m at the test program leader for strollers at Consumer Reports, I’ve been testing strollers for at least 15 years. I think it’s longer than that.

S2: Do you like the hands on stuff? Do you like actually trying out the products?

S1: Oh, yeah, I mean, especially with strollers, you have to you can read about all you want, but until you’re actually pushing it or trying to open or close it, it’s not the same thing. You have to be hands on with that for sure.

S2: When Joe Murota tests out baby strollers for Consumer Reports, she really puts them through their paces.

S3: We have a course set up outside on our grounds and we go through there’s a narrow section like if you’re between cars trying to get through a parking lot up and down hills through like a little slalom course, even up and down curves. And there’s actually an off road section as well where there’s like grass roots kind of thing. So it’s a good picture.

S4: Joan adopts the perspective of a harried parent who has no time for anything that doesn’t work intuitively.

S3: If I have to go on YouTube to watch a video to find out of all this all, I’m not going to be a happy camper camera.

S4: When I asked Joan for her top stroller pic, she was diplomatic. But when I told her what brand of stroller I have, she wasn’t surprised.

S1: Everybody has no. You see them a lot and like you want to have what your friends of your or your your peers, people you see pushing strollers around like, oh, they have enough a baby to have some kind of.

S2: And it’s a great product, Jones Consumer Reports review calls up a baby’s flagship stroller, notably sturdy, and says it delivers a smooth ride, which, as an upper baby owner, I found to be true. Yeah, I have one, just like every other parent in my Brooklyn neighborhood, when my wife and I were expecting our first kid and shopping for strollers, we noticed up a baby’s everywhere we looked. So we figured it must be a decent brand and we bought one. It turned out fine. We’re happy with our choice. But buying a stroller because everyone else had one made me curious about the nature of the stroller business.

S4: Other babies aren’t mere products, their lifestyle signifiers, whose parents pushing them down yuppified city streets are saying something about themselves and to each other, not unlike a teen with a muscle car running down a small town boulevard. I wondered, how does a stroller brand become the one that parents want to be seen with, the one that’s on every sidewalk? And how does it stay that way when new stroller customers are being born every minute?

S5: I’m Seth Stevenson. Welcome to Thrilling Tales of Modern Capitalism. Today on the show, Stroller serving up a baby and the battle for sidewalk supremacy.

S2: The world of strollers breaks into two categories. There are the strollers you can buy a target that cost a couple hundred bucks are perfectly fine, meet all the safety standards and get the job done. And then there are the fancy strollers, the ones that yuppie parents buy because we see all our yuppie parent friends pushing their yuppie children around in them. If you look back at The New York Times is coverage of baby strollers over the last several decades, which I have, you can trace a progression. A fancy stroller brands that one after another became popular among big city parents who could afford them. Each area had its own its stroller for a lot of the 20th century.

S4: The stroller was the Silver Cross, a classic English brand that’s been around since 1877. It’s famous for making expensive brands that are the size of Range Rovers Grace Kelly had won and British royalty for them.

S6: This is the Wilson. It’s the pushchair that gives elegance and comfort. Even in a crowd. It is convenient to push and a charm to display the neat little Wilson it by Silver Cross.

S4: By the 1970s, the hot stroller company was Peg Pelago, an Italian brand with a more casual vibe and bright, playful fabrics. By the early 1980s, the cool upmarket stroller was from Africa, a Japanese brand known for its highly ergonomic designs. But by 1985, according to a Times story from that year, yuppie families on the Upper West Side would not be seen at the playground without their McLaren Luhnow.

S7: Now George from some fresh air, he’s got new rules out. A new McLaren Dreama very deluxe top George. Its Chessie ludicrously powerful breaks comfy reversible seat with full safety honors. Who needs it?

S2: George McLaren is the stroller brand that pioneered the umbrella fold in which the stroller collapses in on itself for maximum compactness. This design was the brainchild of a British man who’d also helped create the Spitfire fighter plane. The Smithsonian Channel even made a documentary about him. Owen McLaren, businessman, former test pilot and aircraft engineer McLaren sees the need for a newer, better stroller, and he thinks the McLaren dominated America’s top tier stroller market through the 1990s, which is when it met its match in the form of a fictional mom.

S8: I worked very hard at taking care of Aiden’s feelings, will, you mentioned that to Steve because if told Steve Perry, you know what, maybe you should call your girlfriend Samantha. She has all kinds of time to talk about this kind of stuff.

S4: But if she could maybe just once acknowledge the fact that I’ve had a baby in a 2002 episode of HBO’s Sex and the City, the character Miranda Hobbs, a type a Manhattan lawyer played by Cynthia Nixon, pushes a purple stroller made by a Dutch company called Bugaboo. This was a legendarily successful bit of product placement and HBO subscribers, just the kind of upmarket urbanites that Bugaboo wanted to reach, started buying in droves. Bugaboos had a cleaner, more sophisticated look than strollers that came before they showed up in paparazzi photos of celebrity moms like Gwyneth Paltrow and Victoria Beckham. Some Thugaboo models sold for upwards of a thousand dollars each, but parents with money just had to have them. They made the bugaboo, the clear it stroller of the early aughts. Watching all this from afar was an experienced product developer named Bob Monahan, who’d made cars at Ford and shoes at Reebok before he moved into the baby products business gates.

S9: I did monitors, I did safety AIDS. I did ride on cars.

S2: It was 2005, the height of the Bugaboo craze. Bob and his wife were about to have their second kid. When Bob took a look at the stroller market, he saw a big hole in it at the bottom where the affordable, no frills strollers, they were a little clunky and not so attractive to look at. They were often covered in tacky prints, teddy bears or rainbows at the top of the market where the European imports, like McLaren and Bugaboo, these were stylish and functional, but super expensive. And because they were foreign, it wasn’t always easy for American buyers to get repairs or replacement parts. Bob, since there was a place for a domestic brand that could offer what he thought of as affordable luxury.

S9: So it was just kind of like a price point, somewhere between two hundred dollars and six hundred dollars. There was a huge opening and also an opening for like a high end brand with more American sensibilities and good customer service. That was the opening.

S2: The other insight Bob had was that unlike with a lot of other baby products, the decision about which stroller to buy was a discussion where a lot of dads like him and I should confess, like me, got deeply involved doing research and comparing specs like they were buying a car. So Bob tried to cater to that demographic with elements that he found appealing.

S9: Cool colors, anodized aluminum, welded aluminum, you know, lightweight instead of steel, the modularity where you snap parts and snap parts off, being able to go over rough terrain with it. The suspension’s I mean, just almost any functionality that you’d see kind of in automotive and then translating that into a stroller. Yeah, that’s what kind of got exciting for me.

S2: Bob quit his job in 2005. The company he started up a baby sold its first stroller in 2006. It slowly gathered steam and Bob’s wife, Lauren, got involved, taking a major role. And then came a global economic collapse that Bob worried might imperil the company.

S10: When the recession hit, we were very nervous. We were just kind of getting going.

S2: As it turned out, the economic contraction hit Bob’s upmarket competitors with their four figure prices harder than Bob’s new middle tier business.

S10: I think it actually worked in our favor because for a while there, there of conspicuous consumption was not cool. So for us, you know, you had people that had plenty of money but didn’t want to spend it all. They had also people that could still reach for it even during recession. So we still grew even, you know, 2007, 2008 bugaboos, ultra luxury image seemed out of step with the times.

S2: Meanwhile, McLaren was forced to recall a million strollers in 2009 when twelve children lost fingers because of a faulty hinge design. When the dust settled, there was a new its stroller up a baby with its slightly more reasonable pricing and safer henges emerged on top and it stayed there. Here’s how Bob got introduced on CNBC in 2017.

S11: Joining us here at post nine is Bob Monohan, CEO at Up a Baby, a high end stroller and car seat company that, if you’re not familiar with, just go to the Upper West Side and you’ll see them all over the place. Welcome. Thank you. Thanks for having me. So what’s this?

S2: That was the year my wife and I were expecting our first kid. And I can attest that when we started tuning in to whit stroller brands, people were using, we saw up babies everywhere in our Brooklyn neighborhood, which I have to admit is what convinced us to buy one. The fact that so many other people had other babies made them feel like a safe choice. And when you’re shopping for baby stuff, Seife is an extremely appealing quality. There’s not much temptation to roll the dice on some weird stroller brand you’ve never heard of. All of which means that stroller success is to some degree self-perpetuating. A company strollers serve as mobile billboards for its brand at the same time, though, there are some unique challenges when it comes to marketing strollers. Maybe the biggest is that the customer base turns over completely every few years.

S12: Think about the apparel industry, people are in the market for shirts and pants their whole lives. If you’re selling clothes and you win a new customer, that customer might be buying your products for decades. Strollers aren’t like that. Stroller buyers have spent their entire lives paying no attention at all to strollers. They can’t even name a stroller brand. And then when they’re expecting their first kid, they suddenly tune in and start paying a ton of attention and then they stop paying attention. Around the time, their youngest kid turns four and they never think about strollers again. If you’re a stroller company, you have a brief window to grab people’s trust. And then those people buy one stroller to it most and they’re done. And you need to grab the next generation’s trust all over again. Oh, poor baby has successfully done this for more than a decade now, but can it stave the stroller forever?

S9: It seems like there’s a target on her back right now.

S13: More on that when we come back.

S14: So this all began when I was in business school, my wife and I welcomed our now four year old twins.

S4: It was 20, 16, Ted Jobst was 30 years old in his first year at Wharton Business School. He and his wife went to a brick and mortar baby store to shop for strollers, and they did not enjoy the experience.

S15: You walk in and you’re immediately inundated with a wall of 100 strollers at different price points, different brands for different parts of your life and your head kind of explodes. And then you look at the price tags and realize, wow, I have to pay what to get a quote unquote high quality stroller. And then you try it out on linoleum floors and wide aisles you think might work, but you have no clue if it would actually work in your real life.

S2: Ted wasnt a fan of shopping in stores, not just for strollers, but for anything. He’s used to buying lots of stuff online straight from a company’s website, the so-called direct to consumer model made famous by brands like Warby Parker for eyeglasses or Cosper for mattresses. It puzzled Ted that the big stroller brands, including up a baby, didn’t sell strollers directly from their own websites. He would have preferred that instead. To get it up a baby, you have to walk into a specialty baby store or you can maybe buy on Amazon. Either way, there’s a middleman, a retailer of some kind that’s handling the point of purchase interaction with other Beebe’s customers and is marking up the strollers final price so we can take its cut. Ted, as a business school student on the lookout for an entrepreneurial idea, thought he’d spotted an opportunity. He did a lot of research. He got connected with a stroller designer and a factory in China. And not long after he graduated business school, he had a product. He named his stroller the Kaluga go after a cute little flying mammal that’s native to Asia in twenty eighteen. When they launched, the only place you could buy Kaluga stroller was from the Kaluga website.

S15: Instead of selling wholesale to a retailer and then having it marked up three plus times again and sold to a customer, we sell it directly to the customer. So all of that retail markup, all the money that the brand would have to spend in marketing it with the retailer and getting it to the retailer is eliminated.

S4: Ted is proud of his strollers design. He thinks it’s top notch, but he thinks up. A baby makes great strollers, too, the way he plans to eat away it up. A baby’s business isn’t necessarily by making a better stroller. It’s by attacking them, using almost the exact same playbook that Bob Monohan used to attack Bugaboo 15 years ago. First undercut them on price went up, a baby launched. It was pitched as affordable luxury, but up babies prices have crept up over time and become less affordable. Ted thinks they’re in part taking advantage of the fact that new parents increasingly seem willing to spend more on a stroller. And that’s because they’re not the ones actually spending.

S15: A real phenomenon we have seen is like the person selecting the product isn’t always the one paying for it. So in this case, I’m talking about registry. Baby Registry has become a bigger and bigger business, both at the baby babies and the targets of the world, as well as some of the more standalone sites like Baby Lists. And even Amazon offers an open registry. So I think when your parents are a group of friends are buying you something, you know, your willingness to pay oftentimes goes up. Sure. Because you’re not paying. Exactly. Because it’s your willingness for someone else to pay.

S2: By keeping his margins down and cutting out the middleman, Ted thinks he can offer a stroller as good as up. A baby’s at two thirds of upper baby’s price, which still matters even in the age of baby registries. The other advantage of that direct to consumer model is how it changes customer service. When someone buys a Kaluga stroller, Kaluga controls every step of the process. The customer gets their information about the product from the Kaluga website. The purchase itself happens on that website in a way that Kaluga has designed the customer’s personal info. I’ll go straight to Calbuco and any questions or feedback go straight to you. Go to.

S14: You know, having that direct relationship means feedback is instantaneous and specific, we’re able to do things like, you know, look at what people are asking us most inbound about our products. You know, they’re emailing our customer service team about something. Ten times in one week, we’re going to change our website and maybe take some more photos and things like that to make sure that customers really understand what they’re buying. And then on the back end, we’re going to send you emails and texts that you’ve opted into, of course, after you’ve purchased something to help you get the most out of your product.

S2: Bob Monahan of Up a Baby thought he could out customer service bugaboo partly by just being an American company, servicing American customers instead of a Dutch company trying to do it from overseas. But Bob also worked to establish a solid customer service team. Joe Muratov of Consumer Reports told me that up a baby is very responsive to questions and problems. Remember, though, when you buy an up a baby at a retail shop, you’re not dealing with an up a baby employee. You’re dealing with someone who works at the shop. Customers with questions or problems might direct them to the retailer, which means up a baby might never hear that feedback. The customer’s contact information might go to the retailer to instead of top a baby. If you’re trying to form a close relationship with your customer, those things get in the way. When I asked Bob if I’m a baby ever considered a direct to consumer model? Ever thought about selling from its own website? He said. It’s not something they’re considering in the near term. Part of why he’s reluctant to change is he feels he owes something to those specialty baby shops that took a chance on up a baby early on and still believe in it.

S9: And the retailers help us launch the business. They help us build the business. They continue to support us and promote us and have the product out. And we continue to be successful that way. So we’re not really in any mood to change at this point.

S4: The advantage of retail shops is people can put their hands on the stroller, see it up close instead of just looking at it on the web. But in the midst of a pandemic, that advantage is severely muted.

S16: And Bob says that’s opened his eyes to some of the merits of selling direct times change.

S9: It’s 12 years after we started, 15 years after we started. And with covid, people buy online, people shop online. There’s word of mouth. People buy brands. So it’s always something we get to watch. We definitely have our eye on it.

S16: Tudehope says Kaluga is doing well and it released a second store model this year. A couple of other new stroller companies, one called Mockingbird’s, one called Lollo, launched not long after Ted did, using the same direct to consumer idea. They’re all going after up a baby and they’ve also got a long way to go before they’re a threat. But if people buy strollers based on what they see other people buying, it seems like if Ted can win over a few influential parents, it could quickly snowball into bigger success.

S15: If we’re able to put pressure on price for the incumbents and we’re able to put pressure on their experience so that they improve it and parents come out ahead across the board, I think we win parents when the industry wins.

S16: If a baby story teaches us anything, it’s that competitive pricing, better service and a little deus ex machina. In Upper Baby’s case, a recession that hurt competitors can sometimes be enough to launch you on your way to jobs. He’s hoping he can replicate that model with a pandemic serving as the deus ex machina. His company still a toddler, but it’s strapping in and putting its feet up for what it hopes will be an exciting strohl.

S4: That’s our show for today. This episode was produced by Jess Miller with help from Madeline Ducharme and Cleo Levin, technical direction from Merritt. Jacob Gabriel Roth is Slate’s editorial director for audio. Alicia Montgomery is the executive producer of podcasts at Slate. June Thomas is senior managing producer of the Slate podcast network. If you like this show, tell your friends to subscribe, but you can also leave us a reading and review on Apple podcasts. It helps other people find us next week on the show. The journalism equivalent of a car crash is driving past a road accident.

S17: It looks pretty bad and the cars are stopping and rubbernecking suddenly hit them. Both people want me to give them.

S4: That’s next week on Thrilling Tales of Modern Capitalism.