Analog, Digital and Toys "R" US


Many successful companies and a lot of the technological disruption in recent years was focused on the relationship between the real world and the online world, physical and virtual, Analog and Digital.

The clear dichotomy of people either operating in the real world or operating in cyberspace (forums, chats, blogs, websites) does no longer exist. People not only jump between them, they actually mix and merge them. Uber, Airbnb, EatWith, Yelp, Amazon, Tinder to name a few apps that combine experiences from both worlds, IoT is basically all about that as well and obviously AR and VR which are the pure manifestation of digital into analog.

Last month Toys "R" Us filed for chapter 11. It is still not as big as Lehman Brothers bankruptcy ($369 Billion) or Kmart's $14 billion bankruptcy but it is the largest US toy store bankruptcy. An honorable place in an honorable list...

I won't write about the reasons for that bankruptcy here or how online shopping disrupts the retail market. I will use this stage to write about the known cliche that every crisis is an opportunity.

So in today's jargon, how Toys "R" Us can make lemonade from the lemons they got? My 2 cents, look at the Analog-Digital synergy. Don't fight it, embrace it.

Online shopping, Amazon, eBay and Alibaba won't vanish. Most likely they (or the type of e-commerce they represent) will grow and evolve. Toys "R" Us should try and leverage the physical presence they have with stores all around the world, and the fact that their main audience is kids who love to play, touch, experience and run (more than they like to sit on the living room couch and shop with their iPad).

A nice example is what Nike did with their Soho location in NYC. They turned the store into a playground. You can come to the store play and experience the products in "trial zones", as they call them. You can run with Nike shoes on a treadmills, shoot some hoops or play soccer. Then, the Nike people hope, you will buy the products there on site, or later from Nike.com.

I am not sure if this is going to be a general direction for Nike in all their stores or prime locations, but it is a nice concept of leveraging the thing that Nike got and Amazon don't (yet?) - the ability to experience the product in its natural environment.

In the case Toys "R" Us (or whomever will own it) is not planning to turn their business into a pure online one, they should think about turning the Toys "R" Us stores that they won't sell, to be more than a nice-looking-storage for the toys (which practically has no real advantage over any e-commerce site) to a real playground.

A place where kids can come to play with the toys and have fun, and maybe, just maybe, buy them there on-site afterwords.

Maybe that's the direction they are indeed taking with the new still-vague brand messaging they released this week, "Today We Play", and maybe it ain't... In any case, I say "Let the kids play! It is the only advantage you got".

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