Toys R Us Failure

1472 Words 6 Pages
Toys “R” Us is considered to be a brick and mortar (BAM) type of retailer and like most BAM retailers, it faced the challenges of ecommerce. (EAI Journal, October 2000) In the early 90’s, Toys “R” Us had a lack luster website. The website layout was confusing with few products listed and very little information about them. There were disclaimers that products on the website may vary from those in the store and supply was limited. (Rothfeder, April 2000) As a result, Toys “R” Us fell behind in the business of ecommerce and sales suffered. More and more customers were turning to online shopping. Eventually, Toys “R” Us realized their mistake of not evolving the company brand and began to look for ways to play catch up. The company started to …show more content…
It had recently launched its new online store and promised customers that all orders placed before December 10th would be delivered before Christmas. But the strain of a new online store, pressure on its supply chain, lack of manpower to deal with the surplus of orders, and not enough time proved to be too much. As a result, Toys “R” Us sent out apology letters two days before Christmas stating that the orders would not arrive in time for the holiday. Customers were outraged and the company’s reputation suffered. Toys “R” Us was quick to make amends offering all affected customers a $100 gift certificate but the damage had been done. The company immediately set about to repair the damage and regain the trust of its customers. It embarked on a ten year partnership with Amazon that would redirect Toys “R” Us online customers to Amazon for orders. Through the years, the company slowly rebounded. (site article #9). Unfortunately, in the 2015 holiday season, Toys “R” Us had another setback. The company ran out of stock in its stores and customers were complaining of the empty shelves. According to Wall Street Journal, it had a stock of only 62% online for the top 100 selling toys during Black Friday. While this is on track with its competitors, it was far below the recommended 95%. In the past, Toys “R” Us considered its shelves stocked if it had three units of an SKU for each product. However, this left their shelves looking empty and understocked to customers, especially if a product was purchase. (site article

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