The Brand Challenge: How to rejuvenate Toys ‘R’ Us

In the first in a series of articles that dissects a brand’s commercial challenges and suggests a strategic direction for how they could be overcome, brand commerce agency KHWS runs its Purchase Quadrant framework over embattled retailer Toys “R” Us.
By plotting a brand on the Purchase Quadrant, you can understand the main reason why they are bought now and could be bought in the future.
There are four dominant modes of behaviour that influence what we buy which are: habitual shopping, copying someone else’s shopping behaviour, following expert opinion or undertaking considered research. These modes make up the four quadrants. These modes of shopping are dependent on four factors; whether we are thinking independently, being influenced socially, thinking fast and shopping instinctively or thinking slow and deliberating over what we buy. These four factors make up the axis on the Purchase Quadrant.

The world’s biggest toy retailer could be facing bankruptcy and needs to find a way to compete with the discounting of the large supermarkets and online retailers. In 2016, 52% of parents bought toys and games from supermarkets compared with 35% from Toys “R” Us (Mintel 2017). It is not the default choice for many shoppers in the UK.
Toys “R” Us is saddled with debt, so it needs to rethink its brand and shopping experience in ways that don’t need a huge investment and can start to make an impact on the bottom line.

Toys “R” Us is currently in the bottom left corner of the Purchase Quadrant – Considered Choice. Toys “R” Us has built its credentials as the leading specialist toy retailer in the UK. Research from Mintel shows it is a trusted brand that caters for children of all ages, but which struggles to differentiate itself in the market. It is one of several retailer options when people are researching and considering which toy or game to buy.

Toys “R” Us needs to move to the bottom right corner of the Purchase Quadrant – Authority. The company needs to leverage its position as the leading specialist retailer to differentiate itself and give a clear reason for people to shop with them. By reinforcing its expertise – something that can’t be claimed by the generalist supermarkets and online retailers – Toys “R” Us can generate more frequent purchases from current and lapsed customers.

It can reshape its offering by building empathy with its audience. It needs to understand that people are often shopping to a budget and want to find the toy or game that will please their pocket as well as their child. Toys “R” Us can show it offers a better service than the generalist retailers by selecting the best products to suit all budgets.

In-store, different zones for different price bands e.g. £0-10, £10-20, £20-40, can be created that showcase the best-selling toys, games and gadgets, as well as the staff’s picks for the next must-have brand. This will help Toys “R” Us promote the cheaper collectable toys that are starting to dominate the market, while showcasing the more expensive toys bought as that special birthday and Christmas present.
This idea can be translated online with content that supplements the existing user experience. An online tool could be created which helps parents shop to a set budget, providing toy recommendations based on the money they have to spend and things their children like. This strategic direction fits with the recent introduction by Toys “R” Us of the Take Time to Pay scheme, where parents can reserve a product and have up to 12 weeks to pay for it.
In summary, Toys “R” Us can rethink the brand experience and position itself as the toy expert that helps you find the right toy, game or gadget you need, no matter what your budget. By creating a more inclusive, helpful and understanding retail experience, Toys “R” Us can ingrain itself as the default choice for shoppers.