Toys R Us is back in the UK, but as a pureplay. Much has changed since it shut up shop back in 2018, so what does it need to do to fit into the new retail landscape? Mark Collin has some ideas
It’s official: the toys are back in town. Well, not quite. They’re back online. Four years after closing its stores, Toys R Us and sister brand, Babies R Us, recently announced a UK comeback in the form of digital ecommerce stores, launched and live ahead of Christmas 2022.
But since Toys R Us closed its stores in 2018, the fast growth of ecommerce has drastically changed the retail landscape and with it, consumer shopping habits. For a company that built its legacy brand in bricks and mortar, an online return is a challenging prospect.
Can it succeed? Only time will tell. But if Toys R Us is to have a fighting chance, it will need to take a strategic, data-led approach. And this isn’t just a challenge for the toy retailer, but in fact any brand looking to make the move to online. So what steps do these brands, be they new or on the comeback trail, need to take to make the most of these possibilities?
Start with product search
Relaunching as a pure-play direct to consumer business is a totally different prospect from adding an online offering to a chain of hundreds of physical stores. Entering the market during a period of high demand, Toys R Us will have to adapt rapidly to consumer behaviour it does not recognise. And it will have to do so without pre-existing product and geo datasets to help with targeting the placement of products.
However, product availability will be its most critical competitive advantage – especially when facing up against Amazon and other online giants. Tempting customers to change their familiar spending habits will require offering not only a finely-tuned digital experience, but the specific hero products that children desire and that parents desperately want to provide them with. Not only that, they must be deliverable in the same time frame as that of Amazon, meaning logistics will be key.
In the early days of Toys R Us’ online return, it should utilise a product search strategy that indicates to consumers that it stocks the most highly coveted product lines. But getting enough consumer eyeballs on paid search ads to make this a success will require significant investment.
Re-create the nostalgia
Toys R Us does bring with it one valuable brand asset from its previous incarnation – the pure excitement and joy that children feel when they walk into one of its stores (especially at Christmas time). Many of Toys R Us’ target millennial customers will have experienced this and be keen to pass it on to their own children. But to effectively capitalise on the nostalgia, Toys R Us will have to find a way of recalibrating this physical experience as an online customer journey.
One option would be to follow the blueprint that brands such as Currys employ – providing personalised, interactive experiences around more considered high-end purchases. By developing its own version of Currys Live, where live discussion with sales members of the team and potentially even product demonstrations or virtual store walkthroughs are provided, Toys R Us could recapture the in-store experience that made it famous, and repackage it for an online audience.
With the caveat that both Currys developed their online experiences to complement in-store offerings, there is plenty of data available to indicate their success. Currys saw a 48% rise in customers using its online service in the first year of Currys Live. It also discovered that there is a 4X greater likelihood of an assisted customer converting than an unassisted one. This demonstrates that exceptional online customer service will be a foundational aspect of any potential online prosperity for Toys R Us.
Treat data as a product from the outset
Toys R Us will have to make gathering and understanding first party data a top priority from the outset. While it may be able to infer insights from old data sets or compete by ploughing money into Google to attract attention, it will be shooting in the dark until it can transition to using real time, attributed data.
In attempting to take on the mass market, Toys R Us will be competing against more established brands. But once it’s able to build accurate customer profiles and access the insights these can provide effectively across the organisation, it will be in a position to start differentiating itself from these competitors.
JD Sports is a great example of an online retail brand that built its online brand this way. It established itself as a key online player by consciously choosing to focus on the fashion element of the online sports clothing market. It did so in conjunction with exclusive product launches to build brand awareness and cement this position in the market. Rival company Sports Direct has also followed suit more recently, choosing instead to concentrate on the performance element of sportswear.
This blueprint could be one of the most effective tools Toys R Us has at its disposal. Once it has the baseline data in place to identify in-demand product types, building exclusive partnerships with manufacturers could see it specialising in a particular aspect of toy retailing and build its reputation in a specific capacity.
Toys R Us may be back, but it is an unfamiliar world they have returned to. The landscape has changed significantly since it closed the shutters for the first time. We’ve had a pandemic, an ecommerce boom, and economic uncertainty. They cannot rely on brand recognition alone. Instead, a data-led approach, with intelligent customer experience at its core, is going to be fundamental in its goal to reach the top of the tree again.
Author
Mark Collin is Managing Director, Experience & Product at Kin + Carta and a former Yoox-Net-a-Porter Global Director
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GUEST COMMENT Toys R Us is back in the UK, but how has it adapted?
by Paul Skeldon
Toys R Us is back in the UK, but as a pureplay. Much has changed since it shut up shop back in 2018, so what does it need to do to fit into the new retail landscape? Mark Collin has some ideas
It’s official: the toys are back in town. Well, not quite. They’re back online. Four years after closing its stores, Toys R Us and sister brand, Babies R Us, recently announced a UK comeback in the form of digital ecommerce stores, launched and live ahead of Christmas 2022.
But since Toys R Us closed its stores in 2018, the fast growth of ecommerce has drastically changed the retail landscape and with it, consumer shopping habits. For a company that built its legacy brand in bricks and mortar, an online return is a challenging prospect.
Can it succeed? Only time will tell. But if Toys R Us is to have a fighting chance, it will need to take a strategic, data-led approach. And this isn’t just a challenge for the toy retailer, but in fact any brand looking to make the move to online. So what steps do these brands, be they new or on the comeback trail, need to take to make the most of these possibilities?
Start with product search
Relaunching as a pure-play direct to consumer business is a totally different prospect from adding an online offering to a chain of hundreds of physical stores. Entering the market during a period of high demand, Toys R Us will have to adapt rapidly to consumer behaviour it does not recognise. And it will have to do so without pre-existing product and geo datasets to help with targeting the placement of products.
However, product availability will be its most critical competitive advantage – especially when facing up against Amazon and other online giants. Tempting customers to change their familiar spending habits will require offering not only a finely-tuned digital experience, but the specific hero products that children desire and that parents desperately want to provide them with. Not only that, they must be deliverable in the same time frame as that of Amazon, meaning logistics will be key.
In the early days of Toys R Us’ online return, it should utilise a product search strategy that indicates to consumers that it stocks the most highly coveted product lines. But getting enough consumer eyeballs on paid search ads to make this a success will require significant investment.
Re-create the nostalgia
Toys R Us does bring with it one valuable brand asset from its previous incarnation – the pure excitement and joy that children feel when they walk into one of its stores (especially at Christmas time). Many of Toys R Us’ target millennial customers will have experienced this and be keen to pass it on to their own children. But to effectively capitalise on the nostalgia, Toys R Us will have to find a way of recalibrating this physical experience as an online customer journey.
One option would be to follow the blueprint that brands such as Currys employ – providing personalised, interactive experiences around more considered high-end purchases. By developing its own version of Currys Live, where live discussion with sales members of the team and potentially even product demonstrations or virtual store walkthroughs are provided, Toys R Us could recapture the in-store experience that made it famous, and repackage it for an online audience.
With the caveat that both Currys developed their online experiences to complement in-store offerings, there is plenty of data available to indicate their success. Currys saw a 48% rise in customers using its online service in the first year of Currys Live. It also discovered that there is a 4X greater likelihood of an assisted customer converting than an unassisted one. This demonstrates that exceptional online customer service will be a foundational aspect of any potential online prosperity for Toys R Us.
Treat data as a product from the outset
Toys R Us will have to make gathering and understanding first party data a top priority from the outset. While it may be able to infer insights from old data sets or compete by ploughing money into Google to attract attention, it will be shooting in the dark until it can transition to using real time, attributed data.
In attempting to take on the mass market, Toys R Us will be competing against more established brands. But once it’s able to build accurate customer profiles and access the insights these can provide effectively across the organisation, it will be in a position to start differentiating itself from these competitors.
JD Sports is a great example of an online retail brand that built its online brand this way. It established itself as a key online player by consciously choosing to focus on the fashion element of the online sports clothing market. It did so in conjunction with exclusive product launches to build brand awareness and cement this position in the market. Rival company Sports Direct has also followed suit more recently, choosing instead to concentrate on the performance element of sportswear.
This blueprint could be one of the most effective tools Toys R Us has at its disposal. Once it has the baseline data in place to identify in-demand product types, building exclusive partnerships with manufacturers could see it specialising in a particular aspect of toy retailing and build its reputation in a specific capacity.
Toys R Us may be back, but it is an unfamiliar world they have returned to. The landscape has changed significantly since it closed the shutters for the first time. We’ve had a pandemic, an ecommerce boom, and economic uncertainty. They cannot rely on brand recognition alone. Instead, a data-led approach, with intelligent customer experience at its core, is going to be fundamental in its goal to reach the top of the tree again.
Author
Mark Collin is Managing Director, Experience & Product at Kin + Carta and a former Yoox-Net-a-Porter Global Director
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