eTagz promotion perfect tie-in for Heelys' latest sneakers

Wheeled sneakers by Heelys were a must-have for many preteens during the 2006 holiday season. This season, Heelys hopes that a new line of nonwheeled "Gamer" sneakers will make it onto their holiday wish lists.

But competition is stiff, so Heelys has hired Seattle startup eTagz to promote the new sneakers with CD-ROMs featuring four video games that can be played on the Internet. The free CDs will be attached to 50,000 pairs due in stores nationwide next week.

Jim Peliotes, vice president of marketing at Heelys, called it a "spot on tie-in, since many of our consumers play video games."

eTagz was formed last year by Isaac Jacobson, a serial entrepreneur who hit pay dirt with customer-behavior tracker Digonex. In 2005, Jacobson discovered that nothing had come of a six-year-old patent for digital hangtags attached to products, so he bought it for an undisclosed sum from a venture-capital firm.

The cost of CDs had fallen dramatically since the late 1990s, making it possible for companies to give tens of thousands away and stay within their marketing budgets, said eTagz President Ed Bruno.

eTagz makes its money by charging companies for each CD that's produced and distributed, typically just under $1 apiece for a minimum of 500,000. eTagz plans to distribute an additional 1 million CDs for Heelys' Gamer line by the end of 2008.

eTagz employs 11 people, all with ownership positions, who spend most of their time pitching the digital hangtag concept to national brands. (The company contracts out for design and programming work.)

But the hangtags don't just help drive sales at retail. They also help gather crucial information about customers for follow-up promotions, Bruno said. The Heelys CD, for instance, encourages players to register their e-mail addresses.

Last summer, eTagz worked with Rocawear, the clothing label co-founded by hip-hop mogul Jay-Z, to collect data about women's denim preferences. Women who filled out a Rocawear questionnaire in stores received a CD-ROM with the Rihanna hit song "Umbrella," plus a video of her modeling clothes with Jay-Z.

eTagz also is developing a CD-ROM of video games for AmPm convenience stores to promote sales of large fountain drinks, their second-most profitable product behind tobacco.

The CDs will be attached to about 4 million lids and distributed to more than 900 stores in Washington, Oregon, California, Nevada and Arizona next year.

— Amy Martinez

To reduce the use of plastic bags , Fred Meyer Stores will give three reusable shopping bags to customers each time they spend $75 or more through Nov. 17. Additional bags will cost two for a dollar. Fred Meyer has sold more than 200,000 reusable bags at 99 cents each since making them available in March. It also offers plastic-bag recycling at its 127 stores in Washington, Oregon, Idaho and Alaska. — MA

Blue Nile has begun offering free overnight shipping for orders placed by noon Seattle time. The online jewelry retailer previously limited free overnight shipping to orders worth $1,000 or more. E-tailers increasingly are offering free or discounted shipping as the holidays approach, but Blue Nile seems to be throwing down the gauntlet with its overnight promise on orders at any price level.

"The initial reaction we've been getting from customers is that they're blown away by it," CEO Mark Vadon said. — AM

Swedish furniture retailer Ikea said it's looking for people to fill 125 jobs at a distribution center it plans to open next year in Tacoma. Positions include operations and systems support, inventory control and safety and security. The distribution center will be Ikea's seventh in North America. It's accepting applications online at www.ikea-usa.com. — AM

Giving to charity has become a gift card of its own with a new Seattle company called TisBest. Beginning next week, people can shop on TisBest.org for tax-deductible charity gift cards in amounts from $10 to $5,000. Recipients redeem their cards at the same Web site, where they can choose from more than 200 charities. TisBest takes a $3.95 fee, regardless of the gift card amount. — MA

Online grocer AmazonFresh now delivers to Google offices in the Seattle area, so that employees can leave work having already picked up dinner. Doug Herrington, vice president of consumables at Amazon.com, said at a Bellevue Chamber of Commerce lunch Thursday that he's talking with other Seattle-area employers about setting up similar pickup sites. AmazonFresh started this year with about 10,000 items and has since grown to 20,000, with plans to reach 30,000 by year's end, Herrington said. It also has expanded its distribution from Mercer Island to Bellevue, Capitol Hill and Kirkland, and now offers pre-dawn home delivery for orders posted the night before. — AM

Seattle-based Affirmagy , an online retailer of blankets with inspirational messages, thinks Thanksgiving could be the new Christmas for gift-giving. Founder Kristen Marie Schuerlein said she's received a "flurry of orders" for Affirmagy's "Gratitude" purple fleece wrap, which includes such sayings as "Gratitude is my attitude" and "How great to be grateful!" The blanket sells for $29.99. — AM

Dry Soda named Darin White its new chief financial officer. White had been vice president of finance and corporate secretary at Celebrate Express. Before that, he was a senior financial analyst at Amazon.com. The two-year-old Seattle soda company's previous CFO, Maureen Brillon, worked part time and is leaving to become a stay-at-home mom. — MA

Retail Report appears Fridays. Melissa Allison covers the food and beverage industry. She can be reached at 206-464-3312 or mallison@seattletimes.com. Amy Martinez covers goods, services and online retail. She can be reached at 206-464-2923 or amartinez@seattletimes.com