Toys “R” Us Makes a Comeback

        A month ago, Toys “R” Us Inc. filed for chapter 11 bankruptcy. This means that a debtor is given time to restructure their debt in order to gain a fresh start as long as they fulfill their plan of reorganization. A child named Bradley sent Toys “R” Us $3 in a box to help them save their store. Bradley’s actions are a strong testament to the love that people have for the iconic Toys “R” Us brand. This kind of constant brand loyalty is what will restore the Toys “R” Us brand to its former glory. One major problem Toys “R” Us has is consumers think they can receive better prices from Wal-Mart Stores Inc., and they have recently shifted their focus from brick-and-mortar stores to online retailers like Amazon.com Inc. Toys “R” Us has been gaining increased media attention after filing for bankruptcy, which could in turn help them to gain more shoppers this coming holiday season. Currently, Toys “R” Us is offering in-store experiences to draw in children and millennial parents who “believe experience is really important.” They created an app that children can use to play games in-store that will unlock in certain areas of the store. Children can compare their scores with other children playing near them. The app also can be used in tandem with the Toys “R” Us catalog to allow children to further interact with the catalog information. The games that children play in-store and with the catalog will collect data and show what toys children want and find important. The app will also give coupons as you shop. They will host a “Parent’s Night Out” with “personalized shopping services, wrapping services, and refreshments” in order to create stronger community ties. Toys “R” Us stores are implementing play labs where children can try new toys. Toys “R” Us has a new website which gives shoppers better gift suggestions and expectant parents a way to find the best items for their lifestyle. They are also going to work to advertise their price match guarantee.

        As someone who once loved going to Toys “R” Us, when I Christmas shop for a toy, Toys “R” Us is typically the first place I check. Toys “R” Us has stood the test of time and retained much brand loyalty. Now they are evolving their current technology and marketing strategy to keep up with the times and better their sales. Children are growing up in an age of technology; it is all they know. Toys “R” Us will be able to draw in new customers with the prospect of combining games and technology through their in-store experience app. This will intrigue a new generation of shoppers and make shopping a more enjoyable experience for children accompanying their parents during holiday shopping trips. Children using the app will definitely find a toy they want for themselves. Media attention from the bankruptcy filing has reignited consumer interest and focus on the brand. Even though this is negative news, it has placed a new spotlight on Toys “R” Us who has been losing consumer attention in recent years. There is a typical brand perception that Toys “R” Us tends to be more expensive than Amazon and Walmart who promote their lower costs and desire to give customers the best deal. Toys “R” Us will be able to find success by promoting the price function to show consumers that they can compete with other stores in this area. It will be interesting to see if values of brand loyalty and a price match guarantee win out over the perception of a lower price and online convenience.

By: Megan McKee

https://www.wsj.com/articles/yes-toys-r-us-is-still-open-for-business-1509329281

Predicting Whole Food’s Future with Amazon by Looking at the Past

        On August 24th, 2017, Amazon officially announced that they would be purchasing Whole Foods. Now, Amazon is just starting to make changes to Whole Foods, and we can look to Amazon’s brick and mortar bookstores to figure out what other changes they plan to implement into the Whole Foods chain. Two years ago, Amazon began using in-store pricing and selection in their bookstores. Meaning, they do not have price tags on any of the items in store, rather customers price check on their phones. Prices are lower for Prime members, and prices may fluctuate to match other deals. Many retailers have not found success with this method of price scanning, known as “showrooming.” Scanning prices, however, allows customers to look at reviews and also allows Amazon to gain a better understanding of what products their customers are interested in purchasing. They use specific information such as what may be selling in a certain zip code to stock products accordingly in-stores. As a result, Amazon has a smaller more personalized book selection of around 5,000 titles compared to Barnes & Noble, which carries 22,000 to 163,000 titles. Amazon picks book titles from local authors, recent events, and titles popular with online shoppers of a particular area. It is expected that Amazon will implement these same strategies in Whole Foods and offer lower prices to Prime members and match online prices to in-store prices. Amazon has released Whole Foods goods on their website, and “in the first month, Amazon sold an estimated $1.6 million in Whole Foods branded products.” Customers feel that Amazon’s personalized strategy provides a “feeling of exclusivity” that brings people back for more, and we expect this above all else will transfer into Whole Foods.

        As a Prime member, I am interested in seeing the various new deals I can get through Amazon. Amazon is expanding their brand and promoting themselves by providing a selective and exclusive experience that other big brands can’t match. It will be interesting to see how Amazon Books and Whole Foods develop in the next few years to further compete with large chain stores such as Kroger or Barnes & Noble. Due to pricing and store availability, it is often easier for consumers to go to their neighborhood Kroger rather than a Whole Foods. However, now that Amazon is selling Whole Foods products online at lower prices, this may level the playing field a bit as consumers are starting to buy more groceries online rather than in stores. Amazon is paving the way to the future by analyzing data instantly about what consumers want so they can give them individualized products. People today are eager to utilize new technology, and Amazon will benefit both the consumer and seller by using the data they collect about what consumers actually want to buy. This may create faster product lifecycles as products will be phased out more rapidly to adapt to changing consumer wants; we can know sooner when products no longer interest consumers. What people are interested in changes constantly, and Amazon is ensuring that they can keep up with the times to provide their customers with the best shopping experience possible.

By: Megan McKee

https://www.wsj.com/articles/amazon-bookstores-offer-peek-into-whole-foods-future-1507887003

Disney's TV Business Struggles

        Disney investors question how Walt Disney Co. will fix their struggling television service business. According to Disney Chief Executive Robert Iger, in 2019 Disney will begin offering streaming services that will sell their content directly to consumers “with no intermediaries.” This is a huge change, as Disney currently creates and licenses content, such as animated movies and TV shows, and sells it to “cable systems and movie theaters.” Disney is now trying to compete with Netflix and Amazon as consumers have turned towards TV streaming services that offer cheaper alternatives for families who don’t want to pay for expensive cable bills. The amount of profit that Disney has been able to make through their television services has been steadily dropping since 2014, shortly after Netflix started developing their own streaming content in 2013. As a result, Disney’s stock has fallen “17% in the last two years” despite their growth in film, theme parks, and merchandise. Consumers see that television is beginning to die out as they prefer to stream their favorite shows and movies online. Disney plans to begin streaming a wide variety of sporting events not currently shown on TV through an online ESPN service. Anyone with their cable subscription should be able to use this ESPN streaming service. Disney will make all movies that they have produced available for streaming online. Disney does not currently have a price for their streaming service, but are considering giving discounts to cable users.

        The location of television and movies is changing from TV screens and movie theaters to computer screens as consumers prefer the lower price of streaming to paying for cable bills or movie tickets. Disney may offer special promotions, such as lower prices for cable users who also want to use Disney’s streaming service. However, this is a limited product market as consumers have already begun moving away from Disney TV towards Netflix and Amazon streaming services. Netflix creates their own content and offers a wide variety of shows and movies, including Disney created movies. Disney will have to make sure to market their product not only to children who currently watch Disney channel on TV, but also to the adults who will pay for the streaming services. Disney’s streaming service may be a positive alternative to current streaming services for families with young children whose parents will no longer have to pay for the high cost of cable for their children to watch Disney channel and movies. It could also work for Disney buffs who can’t always access their favorite movies on Netflix or Amazon. Disney’s ESPN service will appeal to a wider audience of sports fans who can’t currently access the games they want to watch on TV. It will become more clear over the next few years if Disney TV can keep up with the shift to online streaming to compete with Netflix and Amazon.

By: Megan McKee

https://www.wsj.com/articles/future-of-disneys-struggling-tv-business-rests-on-its-streaming-plans-1509793202