What Toys“R”Us Needs To Do Now
By Ashley Gorrie
My heart sank back in October. Toys”R”Us had become another casualty among the ranks of fallen retailers. Many dismissed this as just another bricks-and-mortar retailer destined for extinction. Too big, too entrenched, too risk-averse to take a leap of faith and invest in the future. What stung me personally, in this instance, is that this specific failure demonstrated that we, as brand marketers, have forgotten how to market the element of “play.” If we can’t market play and, in so doing, create fun, how on earth will any other physical retailer survive?
The holiday shopping season has descended on us again, which makes this an ideal time to reflect on the relentless growth of e-commerce and the marginalizing effect it’s having on traditional retail stores. Black Friday e-commerce estimates this year rung in at $5 billion. That’s up a healthy 16.9% over last year, and represents just the latest evidence of this trend. According to Adobe, top-selling items include Nintendo Switch, Hatchimals, Colleggtibles, PJ Masks, L.O.L. Surprise! dolls, and ride-on cars, which confirms that the toy segment is alive and kicking. This increasing shift to the internet begs the question: How are stores like Toys”R”Us relevant to today’s consumer?
I see a glimmer of hope. Now, perhaps, that glimmer may come from flame. But let’s contemplate what phoenix might arise from these ashes. Daunting as it seems, if the process of restructuring results in manageable debt levels, would the entity that emerges do little more than delay the inevitable? Declining revenues and narrowing margins suggest that, to right this ship, there’s more action needed than a mere shuffling of the financial deck chairs.
Still, any need presents an opportunity. And this is an opportunity for Toys”R”Us to do something truly transformative. (Or else.) Surely, brands like Mattel, Hasbro, and others would be more than amenable to seeing Toys”R”Us thrive; it’s infinitely more appealing than being further exposed to a narrowing list of monolithic, margin-squeezing distribution channels.
Surely, brands like Mattel, Hasbro, and others would be more than amenable to seeing Toys”R”Us thrive; it’s infinitely more appealing than being further exposed to a narrowing list of monolithic, margin-squeezing distribution channels.
There’s a sound argument to manifestly changing the conversation. Consider that online purchasing is not in competition with physical stores. In fact, the two are complementary. As author Bridget Brennan wrote in a Forbes article, “When time for shopping goes down, expectations for service and convenience go up.”
Opportunities for Physical Stores
Today’s retail forum has quickly drifted from the days of wanting and expecting the identical customer experience, price, and product availability on- and off-line. Physical retail stores are, and will remain, marketing tools, sponsorship opportunities, education forums— and only then be transactional.
In my opinion, Toys”R”Us has the opportunity to address the needs of women like me. With 70% of mothers with children under the age of 18 participating in the workforce*, women have less time. Period. I know that in my bones because I’m a mother of two. And a CEO. *(U.S. Bureau of Labor Statistics, 2014).
OK, so how can Toys”R”Us help me? Off the top of my head, how about offering the ease and efficiency of ordering pre-wrapped birthday presents? What about click- and-collect holiday satchels? And every once in a while, why not visit the store as a reward for an achievement or a job well done.
But this doesn’t really scratch the surface.
The true issue, I liken to times when I have to purchase paint. Or choose consumer electronics. Decisions are tough to make on the spot. (And things get even more real because there are tiny little humans tugging on my coat and on my heartstrings at the same time.)
Let me explain. I am not a self-proclaimed interior designer. (The idea of choosing from 4,000 shades of grey arouses only anxiety). Which is why really good paint retailers don’t actually market paint. Instead, they sell style and aspiration. They sell me with lighting. Customer service. And an alluring rainbow of beautiful colors. They hire color experts and interior designers to assist me on my path to purchase. There is no expectation to buy on the first visit. I have felt welcome and encouraged to take my time. I have been encouraged to marinate my thoughts in what gives me inspiration and comfort. This is done to reinforce confidence and, potentially, create the opportunity for additional service.
Selling Through Service
When talking brick-and-mortar in the electronics space, it’s impossible to overlook Apple stores. Now, the magic isn’t in the stores’ simplicity. Or necessarily in the newest devices. The genius is, of course, in the Genius Bar. Apple stores are constantly overflowing because consumers don’t fully know what they are doing with the expensive, high-tech items they’re gripping. They need advice, guidance, and education to further their experiences. Apple’s ability to upsell consumers through the Genius Bar is remarkable largely because it isn’t technically on display.
So what does this have to do with Toys”R”Us and the problems for a working mother of two?
Let’s go into the store.
A typical Toys”R”Us location demands parents navigate narrow aisles. All are flanked by towers monumentally stacked with boxes upon boxes of toys. It’s overwhelming.
Like a warehouse. To decipher it, it’s beholden on parents to first extract the information on consumer review websites and peer evaluations. The store neglects to address the intimidating world of children’s products and children’s development. They just sell stuff. So with no convenience, no insight, and no brand building, what is their point of differentiation?
Why not create a fulfilling experience for both children and parents alike?
Introducing: a Museum of Play
Imagine if you could start with a clean canvas, where anything is possible. With a keen retail eye, I would transform the space into a Museum of Play. A real-life multi-room experience, play, and education center. The wildest a child’s imagination could create, sponsored by the likes of American Girl, Lego, Crayola, Apple, LeapFrog, and more.
Real, child-sized construction zones where Little Tykes encourages children to construct the city of their dreams. Swift’s Playground online coding tools partnered with Dot and Dash, teaching children how to code and how to bring their characters to life. Melissa & Doug’s grocery stores partnered with TD Bank, demonstrating the responsibility of finance and commerce. The opportunities are endless.
I get my inspiration from the Museum of Ice Cream. Their experience is delicious and unforgettable: Pools full of plastic sprinkles. Upside down hanging ice cream cone chandeliers. Giant popsicles. And a room with a swing surrounded by bananas. A real, immensely and consistently popular, Willy Wonka experience. When it first opened in New York, tickets sold out immediately, driving hundreds of thousands of people to a waiting list.
A Concept That Delivers
Maryellis Bunn, the irrepressible brains behind the concept, dreamed of and demanded a better way for brands to engage and deliver a profound ROI—beyond the rote buying of digital ad space. The concept wasn’t just fresh, it delivered. Revenues from tickets sales exceeded $6 million in just 45 days. Sponsors Tinder and American Express were also encouraged to think beyond traditional marketing approaches. Attendees created ice cream profiles from their Tinder accounts. They were given Dove Chocolate to sample, which boosted sales 9% throughout the time of the trial. The Museum of Ice Cream created an experience for people—for whole families together—and an opportunity for brands to shock, show connection to the consumer, and, most importantly, to create memories with sticking power.
A Space to Engage
Back to the future of Toys”R”Us. As responsible parents, we are always on the lookout for developmental engagement for our kids. In a safe and fun environment. Many neighborhoods in the Greater Toronto Area already have subscription-based play zones where parents can pay monthly dues for their children to play within their community. This allows parents to interact with their children, children to interact with other children, and for parents to lean on each other and commiserate over the relentless insanity of parenthood. It is a real and viable business opportunity for any neighborhood.
The new Toys”R”Us store—or the Museum of Play—would no longer be judged by its fiscal performance of sales per square foot. When the front of the store is a play space, and an education space, the new financial metric is impressions per square foot. Combined with a membership subscription, Toys”R”Us has solved some deep-seated parental problems. If you address my parental desire for healthy, child-based play, community interaction, and support from educated play ambassadors, I’m yours. Parent and child interaction will allow for trial, brand affiliation, and purchase. And I’d pay a premium for that.
When the front of the store is a play space, and an education space, the new financial metric is impressions per square foot.
This solution isn’t just a marketing tool, it also becomes an operational and supply chain solution. The back half of the 35,000-square-foot store now becomes an inventory logistics center. It can support online purchases, plus pick-ups and returns. The inventory solution will also support regionalized shipments to reduce the time and cost of getting goods to consumers.
The best part is that the consumer will organically market the experience for Toys”R”Us.
The Evolving Consumer
This is how the world has changed: 83% of new moms are Millennials, according to a study conducted by BabyCenter. These new moms spend over eight hours online, primarily searching or browsing for parenting advice, and turn to social media, reading product recommendations from other moms. 46% of millennial moms trust the recommendations of other parents, compared to 39% of Generation X moms. More than any other generation, Millennials depend on peer evaluation. Support for a community and for a memory-based authentic experience would be massive.
In the end, I genuinely don’t believe the sky is falling for the retail industry. Nor do I believe in retail dinosaurs, either. I do think we’re completely capable of marketing play. Yet I’m also convinced we’re at a tipping point where only the bold will have a story to tell.
Creating experiences, tools, services, community, education, and accessibility is the new retail.
So, let’s not yet write the eulogy for Toys”R”Us. I believe there can be a healthy future for the retailer. They just have to use a little imagination.
You know, like kids do.
Ashley Gorrie is CEO of Gorrie Marketing Services. She has been in the retail industry for much of her career, beginning in experiential marketing and finally landing at the family business. Gorrie has led the international growth and development of the company by supporting brands to ensure global consistency with local language and marketing. She completed Northwestern’s Global Kellogg Schulich EMBA. Having had the benefit of working in many facets of retail, Gorrie is driven to ensure that all retail experiences are educational, entertaining, and inspiring.