Retail

Which Retailer Is Replacing Toys 'R' Us This Holiday Shopping Season?

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Last Spring’s bankruptcy that closed Toys “R” Us and Babies “R” Us stores left a hole in the retail landscape that needed to be filled. The only questions were how and where that would happen.

Depending on when consumers were asked about where they planned to do their toy shopping, the questions turned up different answers. In March, Coresight Research asked Toys “R” Us shoppers where they’d be shopping now that the company had closed its stores. What the researchers found was that Walmart Inc. (NYSE: WMT) and Amazon.com Inc. (NASDAQ: AMZN) were tied as the first choice and that Target Corp. (NYSE: TGT) was close behind.

In a new study published Thursday, internet ad platform Criteo reported that nearly two-thirds of toy shoppers plan to “frequent brick-and-mortar stores” while still turning to mobile apps for some toy and baby product purchases.

Criteo’s vice president of analytics and insights, Jaysen Gillespie, said:

Our new shopper insights demonstrate the critical importance of a seamless offline and online shopper journey for retailers looking to gain market share in the wake of these retail giant bankruptcies. For both holiday and everyday purchases, shoppers rely on digital channels for convenience but still crave in-store experiences with their families, especially when searching for the perfect toy. Brands that can offer both will have a significant advantage among competitors.

More than half of toy buyers (59%) purchased toys in a brick-and-mortar store, of which both Walmart and Target have an abundant supply. Convenience is a key, with two-thirds of shoppers using a store within 20 minutes driving time from their homes. More than three-quarters (78%) chose to shop at either a Walmart or Target store as their preferred replacement for toys and baby care goods. Among those who don’t care about location, 55% made their purchases at Amazon.

Brick-and-mortar stores need to offer apps that make toy purchases easy and they need to offer a broad selection of products to replace Toys “R” Us and Babies “R” Us that in the past allowed consumers to fill a reported 60% of their needs for toys and baby goods at the two closed stores.

Research firm eMarketer notes data from another firm, Sailthru, in which nearly 40% of consumers reported more satisfaction from shopping in retail stores compared to just 17% who got more satisfaction from shopping online. Consumers also said they would like to see more brick-and-mortar stores from online-only retailers like Amazon and Wayfair.

For toy shoppers, then, brick-and-mortar is not dead. It has a lead in shopper preference, but retailers need to offer the convenience of an online experience. Online-only retailers need to address consumer preferences for in-store experiences. Consumers, it seems, want it all. The winners are likely to be the one that melds their online and offline offerings into a single, seamless shopping experience. The jury is still out.

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