What to Expect of the Toys 'R' Us Relaunch
Wed, April 21, 2021

What to Expect of the Toys 'R' Us Relaunch

The holiday shopping season is fast approaching and the relaunch of Toys "R" Us couldn't come at a better time. After closing 800 of its stores last year, the toy store has reopened a new one in  New Jersey and a second will soon follow / Photo by: Mike Mozart via Flickr

 

The holiday shopping season is fast approaching and the relaunch of Toys "R" Us couldn't come at a better time. After closing 800 of its stores last year, the toy store has reopened a new one in  New Jersey and a second will soon follow.

Many may see the relaunch as a revival of what it was before, but the new Toys "R" Us seems different now: Instead of selling toys, it seems like the former toy giant merely serves as a marketplace for different brands. It also established a partnership with Target—one that is specifically odd considering Target is one of Toys "R" Us' competitors.

 

Bringing Back That Childhood Nostalgia

In 2018, Toys "R" Us declared that it had gone bankrupt and had filed for liquidation. This meant the company would either sell or close down its stores in the US. The closure sparked debate on who or what led the once supreme toy company to its demise.

But all of that is in the past now, as the awaited relaunch has begun to bring back memories of shopping at the toy store during the holidays. The revival wouldn't have been possible without Tru Kids, the company that teamed up with Target for the company's comeback to bricks-and-mortar retail.

In Paramus, the toy store has about 6,000 square feet filled with various toys. Business news site CNBC says the location will employ about a dozen so-called "toy pros," employees who are trained to test toys with kids and their parents. They will also help shoppers make their orders online if the item isn't available in the store.

In 2018, Toys "R" Us declared that it had gone bankrupt and had filed for liquidation. This meant the company would either sell or close down its stores in the US / Photo by: Ser_Amantio_di_Nicolao via Wikimedia Commons

 

CNBC reports that each store would have about 1,500 items for sale from popular brands like LOL Surprise to favorites like Steiff. Lego, Nintendo, Nerf, and Paw Patrol all have larger spaces in the store to display more of their merchandise. The Nerf shop even has a small shooting range for shoppers to try out items.

The Paramus store also has a treehouse in the middle of the store for kids to play and climb on to as well as a small event space that can be rented to hold birthday parties. If not birthday parties, the said space will hold weekly programs.

It's heaven for kids and kids at heart—but tech and gadgets news site Gizmodo finds something strange about the new stores. 

"Toys “R” Us doesn’t seem to actually own what it’s selling," Gizmodo said in an article, noting that the former toy giant became a sub-leasing space for different brands to promote and sell their own goods.

"As far as we can tell, Toys “R” Us isn’t technically selling anything on its own," the tech news site concluded.

E-Commerce and Experience

Another thing that Gizmodo found strange was Tru Kids' partnership with Target. When Toys "R" Us closed down, Target was among the major companies that nabbed at the market share the toy company left and managed to snatch 15% to 20%, according to Forbes retail writer Greg Maloney.

Maloney is "a bit more dubious" for Toys "R" Us about the deal whereas for Target, "the deal makes sense."

"We’ve seen this before, right? I think we all remember how it turned out for Toys R Us the last time they outsourced their e-commerce business to a competitor," he said, referring to the time the toy company exclusively redistributed its product on Amazon.

It didn't end well, as Amazon started to allow other toy vendors to sell on their site even when its 10-year exclusive deal with Toys "R" Us was still in effect. Only after the toy company sued (and won) the case to terminate the contract did it set up its own website to sell its product. By then, it was too late for the company to learn the ropes of e-commerce and catch up with its competitors.

When Toys "R" Us closed down, Target was among the major companies that nabbed at the market share the toy company left and managed to snatch 15% to 20%, according to Forbes retail writer Greg Maloney / Photo by: JJBers via Flickr

 

"Now, we’ve certainly seen a trend in bankruptcies to chop up assets of a company and sell off the IP," Maloney continued. "Whether that happened here or not, what’s clear is that Toys R Us still has enough brand equity to garner interest from one of the largest retailers in the country."

While Toys "R" Us is still a toy store, the Forbes writer believes it would be too much to call them an online toy retailer since they don't sell toys online nor do they control their supply chain. They're more of a primary resource for parents and children, so to speak.

What Maloney finds interesting is that the brick-and-mortar stores are "doubling down on experience" with their play areas and interactive displays. The lack of an e-commerce distribution chain and possibly limited supply in stores show that the new Toys "R" Us business model seems to focus more on experience.

"They are being smart from the standpoint that they are not moving too aggressively," he said. "If it works, it could be a model for future concepts. But, at the very least, it will be a great case study on how invested consumers actually are in the experience model."