CASE STUDY

WHAT WENT WRONG WITH TOYS R US?

Toys "R" Us was established in April 1948, with its primary shop situated in New York. Toys R Us is the second largest toy store in United State with the total of 840 stores in US. Toys R Us has 1,600 stores in 2018. However, the majority of it was located in U.S where their store in Times Square NY were used to be the largest toy store in the world.

Toys R Us is considered as one of the biggest retail chains which is known to be specializes in Toys. Toys R Us offerings the toys at a premium quality which deemed to be safe and hazardless. Toys R Us has other business segments such as the Babies R Us and Kids R Us. Babies R Us carries the baby products and other essentials includes baby toys. Meanwhile Kids R Us focuses on kids clothing range. However, their pricing is considered expensive in which they set it to covers the profit margin for a high-quality product. However, their product offerings are not very unique after all, as consumers can find similar toys elsewhere with a slightly cheaper price. Since it provides quality products, Toys R Us intended to market its product towards the middle- and upper-class families who could afford it. Toys R Us used various media platform as their promotion to boost the sale. They used to have a TV advertisement playing all over the world. However, it doesnt appeal much on the digital ads like how other brands did. Toys R Us was also involved in in-store promotional activities. Recently, it activates a liquidation promotion that cut off 40%-60% price discount to clear off their inventory overload.

Toys R Us is the company began to lose its share of the toy market on September 18th, 2017 and it has become the third largest retail bankruptcy. Toys R Us was damaged because they did nothing to improve their stores, adapt to technology or tackle the uprising competition. They supposed to reengineer the shopping experience, innovate their product offerings, redevelop marketing plan and how they expose themselves in the online presence.

Toys R Us is the company began to lose its share of the toy market on September 18th, 2017 and it has become the third largest retail bankruptcy. Toys R Us was damaged because they did nothing to improve their stores, adapt to technology or tackle the uprising competition. They supposed to reengineer the shopping experience, innovate their product offerings, redevelop marketing plan and how they expose themselves in the online presence.

As conclusion, poor company management and taking the right marketing interests lightly makes this company unable to survive. By the end of the day, Toys R Us were left with a high amount of unsold products and a huge financial debt.

Questions:

1. Analyze FOUR main problems facing by management of Toys R Us that cause the demise of it. (L4) (8 Marks)

2. If you are the manager of this company, what rational decisions might you make to improve to improve its performance in future? (L3) (10 Marks)

3. Based on the case study, analyze SWOT analysis of Toys R Us (L4) (12 Marks)