Toys R US and Amazon Split Appears Certain
By George Anderson
Nick and Jessica, Sir Paul and Heather, and now Toys R Us and Amazon have made it official. Their romance and relationship are over – done.
Toys R Us, which previously won the right to end its agreement with Amazon because of the online giant’s failure to provide the exclusivity spelled out in the 10-year deal between
the two companies, has chosen GSI Commerce to provide the necessary technology and customer service required to operate Toysrus.com.
Amazon, it should be noted, has appealed the earlier ruling but Toys R Us’ decision to push ahead with its web site with another company suggests that it is confident of the
previous court ruling being upheld.
The split between the two companies is a blow to Amazon and a decision that involves risks for Toys R Us.
Patti Freeman Evans, a senior analyst at JupiterResearch, told The Star-Ledger of Newark, NJ, “Toys ‘R’ Us provides a lot of business for them (Amazon) and nobody wants
to walk away from that business. The change, whatever it ends up being, provides both (companies) peril and opportunity.”
Nita Rollins, director of thought leadership at Resource Interactive, said Toys R Us has a clear opportunity to use its web site to bring its retail banners to prominence once
“People expect Toys ‘R’ Us sites to remind them of the stores, of the experience of playing with toys, and that’s not what you get on Amazon,” she said.
Regardless of how the legal wrangling of the Toys R Us/Amazon saga ultimately plays out, it would appear that there is one clear winner in all of this – GSI Commerce.
The company’s win of the Toys R Us business is one in a number of successes. GSI, reports The Seattle Times, manages and provides customer service for the web sites of
60 companies and groups including Burberry, Major League Baseball, NASCAR and Polo.com.
Forrester Research analyst Carrie Johnson said GSI’s number of clients gives it an advantage over Amazon.
“[Amazon] hasn’t reached that kind of scale yet where they can be very competitive,” she said.
Moderator’s Comment: What do Toys R Us and Amazon need to do now that the split between the two companies is nearly
official? Do you see more retailers going to outsourcing functions such as web site management, customer service and order fulfillment? –
George Anderson – Moderator
- Toys R Us deals new blow to Amazon – The Seattle Times
- Toys ‘R’ Us leaving Amazon for own site – Star