If you’re searching for a new marketing solution to connect with kid consumers at retail, Seattle, Washington-based start-up eTagz may have just what you’re looking for. The year-old company holds a unique patent for attaching digital media to merchandise by way of a CD. The disks, which can be loaded with anything from product information to video clips and games, act like hangtags and create an interactive experience between consumer and brand. According to president Ed Bruno, eTagz have a 76% open rate, and have so far boosted sales of their host products by 26%.

Technical wizardry aside, the concept is pretty straightforward. eTagz aims to load up physical product with digital content and thus draw shoppers in with a perceived added value promise. So a t-shirt paired with an eTag that contains a video game might seem like a great deal to kids on the fun scale, and to parents in terms of getting more bang for their buck. The tags can also house branded content like additional consumer info, partner commercials and previews for new products coming down the pipe.

In the kids space, eTagz is currently working with shoe manufacturers Heelys (the company behind those ubiquitous in-heel wheeled shoes) and Stride Rite. A planned Heelys promotion squarely targets the brand’s tween consumers and builds buzz for a new shoe line with a sole that resembles a video game controller. eTagz has partnered with video game publisher Vivendi for the hangtag, so come this holiday season, 500,000 pairs of the new shoes will roll out to mass retail with tags containing four Xbox 360 games.

For toddler shoe specialist Stride R ite, eTagz is doing something a little different. This time the tag content on a million pairs of shoes launching in February will target moms with practical info about nutrition and exercise ideas for toddlers. The door is open for up to four additional companies to come in as sponsors of the open-network program, and Bruno says he’s looking for partners that can add value. ‘We don’t want moms thinking the tag is like junk mail,’ he explains.

In terms of marketing, eTagz provides the opportunity to really fine-tune one’s reach. With the Stride Rite promo, for example, the shoe manufacturer knows exactly who’s buying its toddler shoes – new stay-at-home moms with higher-than-average family incomes – and the content speaks volumes to that very narrowly defined target. And on the distribution side of the equation, the tags may give manufacturers a leg up with retail buyers because the value-added proposition helps distinguish their products from tagless competitors.

While eTagz has yet to create a cross-licensing program, Bruno sees the potential for licensees to promote their products on tags attached to goods from other manufacturers contributing to the same program. For example, licensed apparel for Bratz could come with a hangtag featuring content from an upcoming DVD and information on new dolls rolling out.

Partners typically help bear the cost of producing the tags and pay a fee to advertise on the disks. Bruno says the price per disk ends up being less than the cost of a regular postage stamp. There’s also an opportunity to exchange content for the retail reach created by the tag. Bruno says eTagz is constantly on the lookout for cool and hip entertainment properties – anything from animation to video games – for the tags. ‘We provide the reach, you provide the content,’ he says. The caveat? ‘It must be something that the customer will find valuable and think ‘Wow, I also get this?’ when they’re buying the product.’