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Toys ‘R’ Us To Launch Marketplace, ‘Play Labs’ In Hopes Of Turnaround

Toys ‘R’ Us To Launch Marketplace, ‘Play Labs’ In Hopes Of Turnaround

More than a week after filing for Chapter 11 bankruptcy, Toys ‘R’ Us is turning to new formats — marketplaces and in-store experiences. The retailer will create a new online marketplace for the Toys ‘R’ Us and Babies ‘R’ Us brands on the Mirakl platform, and will launch “Play Labs” at 42 Toys ‘R’ Us stores, for children to test out the season’s most anticipated toys.

The marketplace is set to launch in 2018. It is designed to enable Toys ‘R’ Us to increase its product selection and decrease time to market for new merchandise, as part of the company’s commitment to serve its customers whenever, wherever and however they want to shop.

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Additionally, Toys ‘R’ Us will use the platform to leverage data from third-party products and sellers to identify potential new retail partners and influence the company’s in-store offerings.

Jumping into marketplace sales as a channel isn’t a new concept for retailers, and the decision to go that route has been a topic of debate for a few years now. More major retailers and brands are selling on Amazon, with third-party sellers accounting for half of units sold as of Q3 2016. Retailers and brands see a benefit in exposing their products to a larger and potentially different audience. But there are also worries that marketplaces can take traffic and sales away from the original channels, or that products won’t be differentiated enough to stand out through the venue.

Aside from the marketplaces, the experiential “Play Labs” signal that the retailer is seeking to give its consumers additional reasons to come into the store. The toy labs will have their own dedicated staff within a 500-square-foot space, and will encourage families to come in and join their kids in play to “test” the toys before actually making a purchase.

The experiential push aligns with the company’s new branding campaign, dubbed “Today We Play,” which was largely the brainchild of recently hired Chief Marketing Officer Carla Hassan, who joined Toys ’R‘ Us in February from PepsiCo.

Given that Toys ‘R’ Us has the tough task of restructuring out of $4.9 million in debt, particularly the $400 million due in 2018, the retailer is clearly seeking alternatives for bringing in customers, maximizing revenue and differentiating itself from competitors.

 

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