Concept Shows Toys and Babies Go Together
RetailWire readers were prescient back in 2007 when Toys "R" Us opened its first two superstores (the combination Toys "R" Us and Babies "R" Us concept) in Elizabeth, NJ and Redlands, CA. In a poll taken at the time, 91 percent predicted the concept would be a winner (50 percent, big; 41 percent, small) for the specialty chain store operator.
At the time, Tom McGoldrick, director of research and consulting for Questar, said, "Young parents are all about saving time and money. This format makes it easer to do both. Their big challenge will be getting the word out. They have to convince consumers that their prices and greater variety of products are worth driving past a Target or Walmart."
Apparently, Toys "R" Us has been relatively successful in getting consumers to bypass competitors and shop in its superstores. The chain just opened its newest 60,000 square-foot combination store in Woodbridge, NJ, and plans to have 43 operating by the end of the year.
"Customers continue to embrace the enhanced shopping experience these stores offer," said Jerry Storch, chairman and CEO, Toys "R" Us, in a press release. "The Side-by-Side store format provides exceptional convenience for parents, offering a wide selection of differentiated toys and juvenile products, and allows the company to cultivate customer loyalty as their children grow and they transition from Babies "R" Us to Toys "R" Us shoppers."
Discussion Questions
Discussion Questions: Is the side-by-side Toys “R” Us and Babies “R” Us concept in line with what consumers want today? Where do you see the greatest opportunities and challenges ahead for Toys “R” Us, Inc.?
This is an obvious growth opportunity for the company, especially in an era where vacant big-box sites continue to be available. The marriage of Toys “R” Us and Babies “R” Us under one roof makes sense as a synergistic blend of two related product categories. The increased space also allows the store to flex up and down by season, depending on whether it’s peak toy season or not.
This is particularly interesting because in general, it appears that big-box, category killer formats are in decline.
I suspect that the combination represents a “destination” for families with children. One-stop (or two-stop) shopping that serves as a way to engage the kids and buy what they want/need in a pretty targeted way.
It’s also interesting that Toys “R” Us has survived the onslaught of Walmart – with its potpourri of $10 toys every holiday season. Toys “R” Us has proven it can reinvent itself over and over again. I would never count this company out.
I do not see the growth potential for the Toys “R” Us and Babies as anything more than moderate. However, this concept has been a huge success for Walmart and Target with their super store concept.
It’s a very good strategy. Another improvement would be to add event rooms where parents can host birthday parties, showers, etc. Add a gift registry so the invitees can select presents (wrapped by Toys “R” Us). Throw in videos, automatic thank you cards, etc., and you have a real winner.