06
Apr

How Toys R Us Should Have Listened More To The Material Girl?

When I read about a Canadian CBC news story featuring a marketing professor saying that big retailers need to be more like Madonna, I just had to keep reading. Professor Nicole Rourke of St Claire College was commenting on traditional big box retailers like Toys R Us and Sears. Her point is that the expectation of customers has moved on and yet many retailers remain unchanged.

We have seen the effect of this change on Toys R Us – they are no longer with us. It’s sad to see such a well-loved brand disappear from our streets and malls, but could it have been avoided and can other major retailers avoid that same fate?

I believe so, but it may sometimes require a dramatic change in the way the business operates. Companies that have defined how they interact with customers for decades are finding that the customer now has all the power. Customers are defining what time they want to go shopping and on which channels. The retail brands are finding that if they cannot place customer needs at the center of everything they offer then customers will migrate to rivals.

Professor Rourke related her own Toys R Us story to CBC: "I like to go into a store, get what I need, get it wrapped up and get it out of there because I have to bring two kids to a birthday party in five minutes," she said. “Offering services, like gift wrapping, or anticipating what a customer needs is important,” said Rourke.

In fact, Toys R Us was always an unusual store. They needed to simultaneously appeal to both adults and children. The children wanted a magical experience and the adults wanted value and convenience. Their failure just underlines how difficult it can be to realign a retail business to changing customer expectations.

Parents who are short on time are far more likely to use an online service, such as Amazon, when purchasing toys. Children and parents alike don’t consider a visit to an out of town box stacked high with toys on shelves to be very magical today. So Toys R Us wasn’t offering convenience or a great experience. That’s the complete opposite of how success looks when the customer experience is so critical.

Retailers today need to have a combined online and in-store offer so customers can go shopping 24/7. They need to offer information and service in an easy way using the channels that customers prefer. They need to offer an in-store experience that makes the effort involved in driving to the mall and parking the car really worth it.

Unfortunately Toys R Us lost their way. They never did follow the example of the ever-changing Madonna. Other big names should take note. If retailers cannot create the experience that customers expect today then their size, reputation, and heritage will not save them from also disappearing.

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