It\u2019s been a tough couple of years for brick and mortar retail stores.<\/p>\n
In 2017 alone, there were:<\/p>\n
The narrative most commonly used to explain this phenomenon comes directly from that last bullet: customers prefer shopping online, and companies operating predominantly out of physical storefronts have been too slow to adapt.<\/p>\n
There may be no company that exemplifies this narrative more than Toys R Us, whose demise earlier this year was front page\u00a0news<\/a>.<\/p><\/blockquote>\n
The shock has lingered. For America\u2019s retailers, the story of Toys R Us has become the ultimate \u201ccautionary tale,\u201d as\u00a0Bloomberg posited last spring<\/a>. But here\u2019s the thing: the rise of online shopping alone didn\u2019t kill Toys R Us. That narrative is incomplete.<\/p>\n
Rather, Toys R Us made at least four crucial mistakes which ultimately led to its withering decline.<\/p>\n
1) It\u2019s not about\u00a0what<\/em>\u00a0you sell \u2014 it\u2019s about how you brand\u00a0it.<\/strong><\/h3>\n
Consider, for example, Nike.<\/p>\n
Nike sells shoes and sportswear, but their brand doesn\u2019t convey that fact. Their brand suggests that Nike does much more \u2014 that they impact culture.<\/p>\n
When you think of a Nike ad, you think of:<\/p>\n
\n
- Serena Williams persisting through adversity to become the best tennis player of all time.<\/li>\n
- LeBron James commanding the energy and attention of an entire arena thrumming with fans.<\/li>\n
- Michael Jordan defying the rules of gravity.<\/li>\n<\/ul>\n
In other words, when you think of Nike today, you think of persistence through struggle, success through sweat, achievement by way of hard work. You think of a sort of athletic version of the American Dream. That\u2019s the effect, after all, of Nike\u2019s ubiquitous \u201cJust Do It\u201d slogan.<\/p>\n
Now, consider Toys R Us. When you think of Toys R Us, what do you think of?<\/p>\n
A\u00a0giraffe<\/a>\u00a0and rickety rows of plastic\u00a0toys.<\/p><\/blockquote>\n
From Mattel to Hot Wheels, Toys R Us relied on the success of\u00a0other<\/em>\u00a0brands to carry their stores. Yes, Toys R Us served as a one-stop shop for all sorts of toys, but so, too, do places like Walmart and Amazon \u2014 places where you can buy a wide variety of toys\u00a0along with everything else you might need.<\/em><\/p>\n
Toys R Us should have done more to do things like develop their own toys, which would have won them more name recognition and brand loyalty. But instead of more purposefully encouraging kids and parents to fall in love with Toys R Us the\u00a0company<\/em>, kids fell in love with the things Toys R Us happened to sell \u2014 things their parents could buy anywhere.<\/p>\n
Branding and messaging is what encourages customers to fall in love with companies, as opposed to strictly appreciating their products.<\/p>\n
2) You must choose your end consumer\u00a0wisely.<\/strong><\/h3>\n
Speaking of parents, they\u2019re the ones who buy toys \u2014 not kids.<\/p>\n
And that\u2019s another key mistake that Toys R Us made. It should have shifted its strategy to market more directly to the consumers who had buying power. One way to do this would have been selling toys that were definitively beneficial for their children, as opposed to potentially detrimental. Because\u00a0that\u2019s<\/em>\u00a0what new generations of parents began to demand.<\/p>\n
Though they had started to make overtures to appeal to that new consumer base<\/a>, by the time Toys R Us was able to make meaningful adjustments like this, it was too late.<\/p>\n
3) Your customer\u2019s in-store experience needs to be outstanding.<\/strong><\/h3>\n
The benefits of online shopping over in-store are obvious and many:<\/p>\n
\n
- It\u2019s less time-intensive.<\/li>\n
- It\u2019s more convenient.<\/li>\n
- It\u2019s easier to compare and contrast prices.<\/li>\n<\/ul>\n
The list goes on.<\/p><\/blockquote>\n
Many brick and mortar retailers have tried to overcome these facts by engaging in something of a price race against the online conglomerates. In other words, they\u2019ve sought to undercut them.<\/p>\n
This was \u2014 and remains \u2014 a recipe for disaster that\u2019s destined to fail. Walmart, for example, remains prepared to\u00a0price match<\/a>. How could Toys R Us ever compete?<\/p>\n
The\u00a0only<\/em>\u00a0advantage brick and mortar stores have over online retailers is the ability to make the act of walking into the store\u00a0an experience<\/em>. Toys R Us failed at this. Instead of creating a sense of cinematic wonder like\u00a0FAO Schwarz<\/a>, Toys R Us felt like an oversized, overly stressful warehouse.<\/p>\n
The experience of visiting a Toys R Us, by the end, simply wasn\u2019t enjoyable. It\u2019s no wonder parents opted for the ease of buying toys at Amazon instead. The experience didn\u2019t justify the effort.<\/p>\n
4) You need to change with the\u00a0times.<\/strong><\/h3>\n
Now, finally, we arrive at the mistake so many like to point to as the sole harbinger of Toy R Us\u2019 demise. And while it\u2019s decidedly not the only reason Toys R Us failed, it\u00a0does<\/em>\u00a0remain relevant: Toys R Us didn\u2019t keep up with the generational shift to online consumerism.<\/p>\n
The sad thing is, back when it would have mattered \u2014 in the early 2000\u2019s \u2014 it had ample opportunity to do so. It had the requisite firepower. But company leadership invested its resources elsewhere, primarily in paying off the debt its private equity backers\u00a0had loaded it with<\/a>.<\/p>\n
The result? Toys R Us fell behind the times.<\/strong><\/p><\/blockquote>\n
Which is exactly what companies who seek lasting success can\u2019t afford to do.<\/p>\n","protected":false},"excerpt":{"rendered":"
It\u2019s been a tough couple of years for brick and mortar retail stores.
\nIn 2017 alone, there were:<\/p>\n","protected":false},"author":4,"featured_media":17149,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ub_ctt_via":"","footnotes":""},"categories":[3386,112,3378,218,114,293,3258,3377,3384],"tags":[],"featured_image_src":"https:\/\/bamf.com\/wp-content\/uploads\/toys-r-us.jpeg","author_info":{"display_name":"Houston Golden","author_link":"https:\/\/bamf.com\/author\/josh\/"},"acf":[],"_links":{"self":[{"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/posts\/5301"}],"collection":[{"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/comments?post=5301"}],"version-history":[{"count":0,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/posts\/5301\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/media\/17149"}],"wp:attachment":[{"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/media?parent=5301"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/categories?post=5301"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bamf.com\/wp-json\/wp\/v2\/tags?post=5301"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}