Celeb offspring Suri Cruise has been seen toting the Little G giraffe, a $45 stuffed toy made by Little Giraffe Inc. of Van Nuys. That sort of street cred – the kind that comes with the daughter of Tom Cruise and Katie Holmes dragging around your product – certainly can spur sales. But is it enough to attract China’s picky luxury consumers? The San Fernando Valley manufacturer and retailer of upscale baby blankets, toys and clothing is about to find out fast. The company is selling its wares this Christmas season for the first time on the giant Tmall.com website, China’s equivalent of Amazon.com. And it has high hopes for the online initiative, given the country’s well-documented taste for Western luxury products – and its one-child policy for couples. “The children are referred to as ‘six-pocket babies,’ because each family generally has one child that is lavished by parents and two sets of grandparents,” said Chief Executive Trish Moreno. “This created a window for us to enter the market.” Little Giraffe, owned by Newport Beach-based private equity firm Crosse Partners, struck the deal to appear on the Tmall website owned by Alibaba Group Holding Ltd. of Hangzhou, China earlier this year. Its timing couldn’t have been better. Alibaba reported that it set a one-day sales record on Nov. 11, or “Singles Day,” which is a day growing in popularity for single Chinese men and women to purchase goods for themselves. Little Giraffe’s product line first was displayed on the Tmall site just weeks before. Oceanne Zhang, an analyst at the Shanghai office of Kantar Retail, a London consultancy, said there is a definite opportunity for the company, despite some stiff competition. She noted that young couples, in particular, are spending more and more on their children for retail goods. “As the parents are younger, richer and more influenced by Western culture, they do spend a lot of money on baby products like fancy child apparel, toys and so on,” she said. “I do see quite a potential market in terms of this.” Growing up The push into China follows the 2009 acquisition by Crosse Partners of Little Giraffe, which was founded in 2000 by a mother and daughter who sold out to Crosse. Zachary Fischer, a co-founder at Crosse, led the acquisition after being introduced to the company by a friend. The move came despite Crosse having a portfolio of companies that did not include any retailers. Its holdings, for example, include Advanced Structural Alloys LLC, an Oxnard aluminum products manufacturer. Fischer said his personal knowledge of the brand – his wife bought the products for his infant son – influenced his decision. “When we were first introduced, we were already fans of the brand,” said Fischer, who did not disclose the purchase price. Moreno, who had experience in the fashion retail sector as an executive vice president of bebe stores Inc. in Brisbane, was brought in as chief executive officer and creative director in 2009. Under her direction, the company expanded its limited product lineup, which had included baby blankets and some adult throw blankets and robes. Infant clothing expanded to baby caps, onesies, hoodies, jeans and even a leather moto jacket. The company rounds out its offering for new moms by offering throws, pillows, blankets and plush robes for adults. Moreno also introduced a new color palette and decided to create products, such as the Lil G plush toy, based on the company’s Little Giraffe logo. Previously, the company’s product lines did not include any stuffed animals. “The biggest challenge was to make the brand relevant to new moms – to give them a reason to come back to Little Giraffe after receiving a gift. We had to up the coolness factor and also create brand extensions that would resonate with new moms and with their kids,” Moreno said. Prices range from $31for a microfiber velvet blanket to $179 for a cashmere knit romper and blanket. Its large Big G giraffe plush toy goes for $168. The expansion into China seemed like a logical step given the competition the company faces in the U.S. market. Among its domestic rivals are Barefoot Dreams, an Agoura Hills maker of hand-knitted baby blankets and other knitted products. Fischer noted the company had already been selling at smaller online retailers in Asia, but not in China. “China was another geography to pursue. There certainly is no other e-commerce platform like Tmall in other parts of the world. We sell to retailers online both in the U.S. and in Asia, but not to the scale of Tmall,” Fischer said. Market penetration Neither the company nor its private equity owner release sales figures, but they boast that growth has been in the double digits since the acquisition. Still, it’s not certain Little Giraffe will crack the market. In China, its pricing is higher than domestically. For example, its Bella blanket is retailing for 755 yuan, or $124, slightly less than twice its $74 domestic price. And its Luxe blanket sells for 825 yuan or about $135, again much higher than its $86 U.S. price. Moreno said the higher prices abroad are due to the cost of freight and exporting. Seventy percent of the Little Giraffe line is made in the Valley, with certain supplies made abroad, like the adult Dolce blanket. That pricing puts the products in line with even more upscale competitors, such as Burberry which offers Merino wool kids’ blankets for $225 online at Neiman Marcus. (Little Giraffe also sells online through major department stores such as Nordstrom, Saks Fifth Avenue, Bloomingdale’s and Neiman Marcus.) Zhang, the consultant, warned that companies seeking to expand online in China need to be aware of the increasingly saturated marketplace. “They are facing very fierce competition from small vendors in China and the online market is going very rapidly,” she said. “It is not easy to gain money here. You need to spend much more money on traffic and search engine optimization to improve your conversion rate. The market is getting more consolidated.”