Richard Gottlieb

The toy industry needs Toys R Us to take the top position back from Wal-Mart

Toys R Us is getting smarter. Thank God, we need a smart Toys R Us. Why, because the toy industry needs to give the American consumer a broader and brighter vision of the toy industry than the narrow group of sku’s they find in Wal-Mart.

A toy store or toy department needs to be about magic, excitement and surprise. Not the deadening experience that almost 25% of Americans get when they visit a Wal-Mart toy department with its line up of the way, way too predictable.

That’s why I was so pleased to read a very positive article on Toys R Us in the Houston Chronicle. As the paper put it: “A visit to the Toys R Us super store… is not like the experience a shopper might have had in one of the company's stores a decade ago… [With] cramped aisles between boxes stacked high… [Now it] is huge and bright with trendy signs illustrated with happy baby and kid photos and Snow White and her friends.”

The article goes on to quote toy industry analyst Sean McGowan of Needham & Co as pointing out that Toys R Us had become highly adept at spotting trends. For example, McGowan noted that Toys R Us was the only major retailer that took a major position on Zhu Zhu Pets.

What struck me most of all was McGowan’s point that Toys R Us is not trying to compete with Wal-Mart on price, its selection is deeper and its inventory is fresher.’” This is an important notion for anyone who chooses to compete with Wal-Mart.

We need retailers to broaden their sku counts so that the American consumer sees the toy industry as a mix of the wild, wonderful and surprising. The only way to make this happen is for retailers to carry more products from more companies. It’s good for retailers, it’s good for manufacturers and it’s good for the consumer.

Posted by Richard Gottlieb on October 25, 2009 | Comments (2)