7 lessons the toy industry can learn from Toys"R"Us

toys r us1

As the news of the impending closure of ToysRUs, adults everywhere are silently humming the theme song of our youth. “I don’t want to grow up, I’m a ToysRUs kid”. Could it be that that very sentiment, a battle cry against change, turned out to be the downfall of one of America’s icons?

Most of us remember when Blockbuster shocked the world with its closure; this soon after they passed on acquiring Netflix.

There is a lot of chatter about industry disruption that is forcing our brick and mortar stores to extinction. But, is it really the fault of Amazon or is there a deeper, human need that “brick and mortars” just won’t step up and fill?


“A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.”

Wayne Gretsky had it right in all things sports and business.



For the Toy Industry, specifically, we dig into 7 lessons that support your business and may give you some insight to where the puck is going to be.


1. Convenience is the currency of the digital age.

Our homes are getting bigger, our shopping is becoming virtual. Aside from work and social life…families are sticking closer to home. When considering a strategy that will outlast tomorrow for your toy business, know that convenience (and customer experience) will attract a more loyal following in today’s digital age.


2. Experience is everything.

One lesson we can learn is that the experience of ToysRUs didn’t really evolve with the times. When mall shopping was an actual destination, the experience model of the store where you could play was king. But, if you happen to shop on their website and then a competitor’s website, you spot a few glaring mistakes. The user experience of the website is clunky at best and packed with ads for other companies. The second major user experience mistake is off website. While modern eCommerce companies have long-been integrating with social shopping, text concierges, etc.; ToysRUs did not properly invest. The reason Disney is still one of the strongest brands in the world is because they focus on “feelings” of consumers, no matter the activity. The pivot to this point: How people feel when buying/shopping/recommending is more impactful than what they can do. If they feel happy/special/smart/hip while engaging with your toy business, that is a stronger currency than a one-time store visit.


3. When “me too” is a strategy, you lose market share.

Before the advent of online shopping and citizen journalism, you found out about the new toy by going to the store. But, think back to the “IT” toys of the years, you did not discover them through ToysRUs. From Tickle Me Elmo to the Hatchimal, society didn’t associate these must-haves with the retailer’s brand. They missed the boat in promoting the new and unique in favor of stocking the shelves with factory brand “meh”. Another opportunity missed were the breakthrough toys that came to popularity in crowd-funding sites like Kickstarter. Without embracing the connection economy, they basically aligned themselves with big-box stores, deprived of the discount. The lesson here is, if your business is focused on quantity vs unique positioning and inclusiveness of trends, your toy business will represent an outdated model.


4. Be inclusive.

Somewhere, in all of this, we stopped singing the ToysRUs song. Stopped identifying toys with their brand. A quick look at their social media profiles shows millions of followers and a very low engagement rate. In their social media, it appears to be as if their only goal is to sell a product. This is a major mistake in brand marketing. In social media, the followers/fans count 100% as much as the brand. Today, your business is not your brand. It’s ours. Yours and mine.


5. Online customer service must exceed all expectations.

Another “social” misstep, extended to all their digital properties is the lag in customer service. If a customer is considering being a patron, it should not take hours to get a response. With the automated workflows of today, instantaneous, intuitive service is available for all sizes of businesses.

P.S. - this expectation of seamless customer service extends across every area of your business, even inventory management. For some early-stage distributors, this means graduating from your google sheets inventory template to an inventory management solution that can predict inventory requirements based on forecasted demand.

6. Don’t let your audience forget about you.

Their executive team failed them when they let them lose the spotlight. When is the last time you saw a ToysRUs ad? Past the eCommerce strategy fails, it’s possible the doomed retailer could have bought more time to evolve, had they not cut marketing as an “expense”. The lesson is, your marketing is an investment, and should be the last budget on the chopping block.


7. There is still a place for small to medium retailers to succeed.

Despite the popular notion, Amazon is not to blame for their demise. A series of bad decisions, followed by an inability to evolve is the warning here. Remember with your toy business, when you choose a strong digital strategy, distinction is your insurance policy. Using a strong eCommerce partner who is in the business of solving the pain points of small to medium businesses, frees you up from technology woes and allows you to create the right strategy based on societal development and service to the customer.

There are, undoubtedly, many other lessons to learn and problems not publicly identified. We hope this serves as a stimulant for your business and eCommerce strategy and that you enjoyed this article.


Categories: B2B eCommerce

Tags: ecommerce

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Jennifer Barbee

This is a guest blog by Jennifer Barbee, CTC, NLPP, CEO of Destination Innovate. She is a member of the Forbes® Agency Council and a 20 year eCommerce expert.



  • Comment by Rachel Green on July 4, 2018

    Very well said, Ms. Jennifer Barbee, Agreed with you that yes there is a still place for medium retailers.

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