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Where Are All the Toys “R” Us Kids?

They Grew Up, But Where Are Their Toys “R” Us Kids?

By Zach Kliger

“The greatest toy store there is” has decided to shutter 182 outlets across the country — about 20 percent of its total footprint. This isn’t exactly surprising, given the downward fortune of the company year in and year out. This latest effort to retrench is part of the continual effort to emerge from bankruptcy, which they filed in late 2017.

There are two predominant theories to explain the situation. Some argue that in an increasingly digital world, there’s not much reason to play with a piece of cheap plastic when children could have the whole world in their hands with an iPad. Others suggest it’s just more proof that these kinds of purchases are moving online faster than ever.

These theories have some hint of truth to them, but they each diagnose symptoms, not the underlying disease. Physical toys never stopped being something kids want, and there will always be a place for brick and mortar stores that do a good job selling them. Toys “R” Us took for granted that its consumers would “always be Toys ‘R’ Us kids,” and failed to evolve in a world where the large, physical toy store isn’t the premiere option available.

Back in the 80s, 90s, and early 2000s, there was something magical about stepping into a toy store. It was a window into a child’s imagination: an opportunity for them to walk the aisles, and picture everything they could do – if only they could just convince mom and dad to let them bring that one toy home.

Walking into a Toys “R” Us now, it’s clear how sad and decrepit things have become. High ceilings, empty shelves, and the pervasive feeling that something has died — that something is missing. The magic is gone.

Maybe it was always that way. Maybe the rose-tinted glasses shoppers wore as kids made it all look like something so much more than it ever was. But it’s clear that something has changed, and it’s not that kids don’t like toys anymore. Retail just doesn’t know how to sell toys anymore.

Kids Don’t Need Toys When They’ve Got iPads

Anyone who has spent five minutes in a family restaurant knows young eyeballs are glued to devices. But among the most popular content on those screens? Videos of other kids reviewing and playing with toys of all kinds. Ryan ToysReview is a YouTube channel hosted by a 6-year-old who rakes in $11 million a year making toy videos. Ryan is just one of many content creators that’s receiving millions upon millions of views every month from a demographic that’s clearly still present and clearly still interested in getting as many toys as they possibly can.

But Ryan’s channel says something else about kids these days. The accessibility of content on the Internet has transformed them into shoppers just as discerning as any adult, and they take the time to do their research. They know what makes a good toy, and they’re not going to settle for anything less than that.

This is a sea change on a number of different levels, not the least of which is a transformation in who Toys “R” Us’ true audience is. In their halcyon days, toy retailers ran youth-targeted advertisements, but acknowledged that parents retained the power of the purse, and ultimate buying decision.

Since they weren’t accountable to their end user, Toys “R” Us and other retailers spent decades cheapening their product: relying on low-quality, mass production to eke out every inch of profit margin they could. That worked when the toy simply needed to look good on TV and in mom’s shopping cart, but kids are smart to it now. In-depth YouTube reviews expose cheap manufacturing or lack of continued play, and drive kids to desire something cool, and something quality that can capture their imagination and their playtime.

The challenge presented by iPads and other devices isn’t new, either. Pressure from electronic games has existed since Atari showed up on the market, and escalated with each new generation of console. While Roblox and Minecraft may own some of that space now, Ryan’s channel is strong evidence that digital pleasures can’t completely usurp the visceral joy of smacking two pieces of plastic together.

Online is Eating Up Retail

The second, most common excuse for Toys “R” Us’ demise is the one used by executives of every failing traditional store in the word: eCommerce. It’s true that Amazon’s $400 billion-dollar market capitalization leaves even its biggest competitor Walmart in the dust. But there’s still plenty of opportunity in physical retail, and it’s nowhere close to dead for many different reasons.

Pointing a finger at eCommerce is a convenient excuse for organizations and executives that lack the imagination, ability or awareness of their audience to stay relevant in an era of increased competition.

During their initial bankruptcy filing in 2017, Harvard Business Review made it clear that while Toys “R” Us is singing its swan song, most of the physical retail world is doing just fine. Plenty of people still love to get outside and shop, but they want to go to stores that cater to that desire. Greg Satell articulates the new normal of retail well:

“The reason that Apple stores look as they do is they are not designed solely to drive transactions — they’re designed to do everything that can’t be done online, such as build relationships, offer service, solve problems, and upsell.”

Once upon a time, Toys “R” Us was a part of its own disruption as it and the other big box stores consolidated shopping to massive and accessible locations. But they got complacent, decided that was enough, and failed to adapt to what consumers — kids and adults alike — want out of their shopping experience now.

Woden worker Hannah Landers recently analyzed the things that shopping malls can do to lure back shoppers. Her conclusion, in a word: experience. Amazon and other online sellers have achieved a thorough stranglehold on convenience and price efficiency — retailers need to play a different game. The conclusion for Toys “R” Us is similar to that of the mall. Having the most toys under one roof is impossible, so there must be something else to draw shoppers (and their paying parents) in the door.

It’s not that kids don’t like toys anymore, and it’s not that they don’t want to go to the store to see all the wonderful things they could bring home. They just don’t want empty shelves, dirty linoleum floors, and cheap plastic. They want a place where they can go, have a great time, and get excited about all the things they could do if they can just convince their parents to bring that one toy home.

Toys R’ Us never sold toys. It sold the magic of imagination. It’s just one more example of the enduring truth that people don’t buy what you do, they buy why you do it. Toys “R” Us lost track of the “why” that defined them. They focused on the short-term bottom line instead of the true hero of their story (the kids walking into the store), and they’re paying the price for it now.

Whether their business is selling toys in a retail store or shopping software online, no company can afford to lose track of their hero. Engaging them, making them care, and creating the right kind of experience for them will always be the key to success.

Zach Kliger is an associate at Woden. Whatever your storytelling needs may be, Woden can help. Read our extensive guide on how to craft your organization’s narrative, or send us an email at connect@wodenworks.com to discuss how we can help tell your story.