"Toys 'R' Us was more than a store, it was a place of wonder where characters, in a way, came to life and participated in one's own lives; it was a place where even adults could indulge their child-like side". -Elsy Perez
Toys 'R' Us became the latest nostalgic retailer to die when they announced early this year that they would be closing their stores. The founder of Bratz dolls, Isaac Larian, made an offer of $675 million to keep some of the U.S. stores open and a $215 million offer for the stores in Canada. However, Larian's offer was shot down by Toys 'R' Us' lawyers and advisers, claiming that the amount of the bid did not meet the bid that was needed to be approved by the court to continue the operations of Toys 'R' Us stores.
Since Toys 'R' Us' announcement of store closures, liquidation sales commenced immediately without attempt to reconcile the situation that is preventing the operation of the business to continue. The founder of Bratz dolls noted this with great lament saying, "…it’s really a shame that they’re going to let this company go into liquidation instead of at least responding and saying we need more or we need this”. Toys 'R' Us' reason for filing bankruptcy is due to the $5 million dollar debt they accumulated and cannot reorganize to salvage the company, and the competition they were having with Amazon and other discount retailers such as Walmart.
As is seen in the estimated online net sales of 2016, Toys 'R' Us was being squeezed by competition from Amazon and Walmart. Toys 'R' Us was being squeezed by competition from other discount retailers because they failed to adapt to each advancement and change that occurred in the world. Toys 'R' Us was also weak in their implementation of their marketing mix. Primarily, they were lacking in promotion. Toys 'R' Us' name nor ads were seen or heard of as frequently from other retailers such as Walmart, Target, and Amazon. Without promotion, their product does not have awareness and as seen today, trends promote and create incentive for consumers to follow that trend. Toys 'R' Us' lack of promotion affected their product creating a loss of identity as to what the product of the company was. Likewise, because of the lack of promotion, price was also affected. The prices of Toys 'R' Us are significantly higher in comparison to other retailers which is why promotion plays a key role in attracting attention and customers.
WSJ Article:
Toys 'R' Us Rules Out Billionaire Bratz Maker's Offer
It is sad toys r us arent letting themselves get help. I grew up in Spain and Toys r us was not that big of a deal there; however, while growing up, I traveled from spain to houston a couple times and I do remember going into this store and walking down the isles mesmerized with all the toys that were up for sale. Now my children won't get to do that...
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