Toys 'R' Us is taking a new approach to merchandising by expanding its line of private-label toys.
The toy retailer has been struggling, with even holiday sales falling 4.5% last year, and at one point its former CEO blamed the low birth rate for the depressed demand for toys.
After partnering with Amazon, then GSI Commerce, and finally eBay, the retailer is also now bringing its e-commerce operations in house.
Private label branding is never a guarantee — it depends on quality and general appeal, maybe even some luck. But one of the key challenges for Toys 'R' Us in the past several years has been dealing with the fact that the same toys it sells are available elsewhere, sometimes at cheaper prices — that phenomenon known for so long as “the Amazon effect.” And its Journey Girls doll brand, which it introduced five years ago, has been a hit and is ripe for expansion.
This move to increase its roster of more unique merchandise could be the right answer, especially if the retailer can give shoppers what they’re looking for. And bringing its e-commerce operations in-house could help the company boost its omnichannel operations to what it needs to be.
“We are looking at private brands and branded products together to offer a more diverse assortment,” said Toys ‘R’ Us Chief Merchandising Officer Richard Barry. “Every product has got to pay for its space on the shelf.”