Farewell, Geoffrey. Is a Poor Digital Marketing Strategy Responsible for the Crash of Toys R Us?

Written by Linzi Hunter: Head of design.
· 4 minute read

As we bid a fond farewell to Toys R Us (& Geoffrey the Giraffe🦒) we can’t help but wonder; could a better digital marketing strategy have saved them?

 

The past decade has witnessed the crash of several celebrated British high street brands. Blockbuster, Woolworths, Maplin and Toys R Us are all now firm fixtures in the retail graveyard – with a number of other famous names, from Debenhams to Mothercare and House of Fraser, appearing to be teetering on the brink.

The Office of National Statistics reports a growth in weekly household spending for the April 2016 – March 2017 financial year, reaching levels we have not seen since 2006. So if household spending has increased, this suggests that the reasons for the decline of Toys R Us are less to do with economic conditions, and are more the retailer’s own failures.

 


 

Naturally, most point the finger to online competition, and while this is something that certainly puts pressure on ‘traditional’ retailers there have been many omni-channel strategical success stories from John Lewis to Waterstones.

An article in The Guardian concludes that “The veteran retail analyst Nick Bubb said: “Toys R Us simply couldn’t compete with Amazon and other online retailers with its shabby and expensive ‘big box’ stores. Consumers won’t miss it when it’s gone.”

BBC article concludes that “Toys R Us has made a loss seven out of the last eight financial years. … Financially weak, Toys R Us has been unable to adapt to changing shopping habits. These days, many shoppers don’t want or need to drive 20 minutes to a big out-of-town warehouse to buy toys.”

 


 

So, could a better digital marketing strategy have saved them?

 

Many expert opinions argue that the Toys R Us warehouse style store is a negative, that they don’t appeal to consumers and are big to fill and maintain. But, in my opinion there’s a huge point to be made about in-store experience here. The warehouse style stores didn’t offer a compelling enough experience for shoppers once its price advantage had been lost to online competitors.

Other retailers such as Nike and their experience driven retail stores are really making the effort to offer experiences that consumers simply can’t get online, such as testing out new products in real sport play before buying. But, more importantly, the store also serves to bolster Nike’s digital strategy. Fully connected and integrated with the Nike app, even if customers walk out without making a purchase, their data is stored and accessible, and the path to future purchases – be they made at the same store, a different one, via the app or on the Nike website – has been decidedly lubricated.

 

Image Source: Business Insider

 

Immersive in-store experiences can be reimagined to integrate digital ones – rather than the two being kept constrainedly separate. And whilst Toys R Us failed to capitalise on the opportunity of creating immersive in-store experiences they also failed miserably online:

Utilising their established brand as a toy retailer, Toys R Us should have:

  • Taken advantage of their product range to capture consumers at the end of their buying journey through well optimised product pages and Google Shopping campaigns.
  • Used Social Media Advertising to keep their brand front of mind for parents.
  • Fostered cross-channel purchasing, using the website to drive footfall to special events, product launches, discount days etc. and using receipts and flyers in store to drive online purchases
  • Negotiated product exclusives.

They could also have rewarded customers directly, or indirectly by:

  • Making their loyalty scheme a bigger selling point and improving it with discounts or free gifts as rewards.
  • Joined customer reward schemes such as Nectar or Avios to gain access to consumers looking to collect points for other purchases.

While there may be many reasons for the crash of Toys R Us, it’s clear that the retailer hasn’t performed as well as it could have online, and that retailers continue to ignore digital at their peril. 

 


 

Finally, enjoy this completely nostalgic addition that will probably make your day: