With the nursery complete, there remained just one thing left to tackle: the closet. So, we did a quick purge of the space and started from scratch.
The first thing I purchased was an Ikea Kallax unit in white, to provide extra shelving and storage. I placed the unit on the ground inside the closet and added cute gray and white striped baskets from Land of Nod to transform the open shelving into "drawers." I chose these baskets because they're soft and light, making them safe for our son to toss his toys into and (more likely) pull out and drop onto the ground. The fact that they're striped is an added bonus for me. To curb clutter, I also added storage boxes from Ikea to the top of the closet to house things we don't regularly use or items that our son will eventually grow into. This way, they're easily accessible but still out of the way.
I hung each piece of clothing on these matching felt hangers baby hangers because they grip the clothes nicely and take up very little space (we even use the adult-size in our own closets). And to keep his clothes organized by size, I added dividers to the clothing rack that sort each item by month (newborn, 0-3 months, 3-6 months, etc.), which has made dressing him so much easier. I can't imagine not having these dividers in the closet; they're seriously a life-saver!
See below for photos of how the closet turned out, as well as sources: