Tag Archives: toys r us

Why Radio Stations Are Like Toy Stores

Tuesdays With Coleman

Back in March of this year, I wrote a blog post called Why Toys “R” Us is closing.

In it, I argued that while market forces and new competition played a role in its business decline, it was lack of brand depth that did in Toys “R” Us, a company that had complete domination of the image for “toy store.”

The last Toys “R” Us closed its doors on June 29.

I suggested in the post that Toys “R” Us had become a commodity. The store was simply a brick-and-mortar space for transactional exchanges.

The problem with that, aside from the fact that there was no real reason to buy toys there as opposed to Wal-Mart or Amazon, for example, was that Toys “R” Us forgot that the very experience of children and toys is a magical one. The retail toy buying experience, I said back in March, must be an experiential one.

It’s why those of us old enough to remember still sing the Toys “R” Us jingle.

It’s why we cried at the end of Toy Story 3.

It’s why Tom Hanks danced on the piano in FAO Schwarz in the movie Big, which was released 30 years ago this summer.

And speaking of FAO Schwarz

Did you ever visit the flagship Manhattan store when you were a kid? I thought it was the greatest place on Earth. There were giant toy soldiers, flashing lights, larger than life teddy bears and ABC blocks and toys to play with everywhere you looked.

There was staff everywhere with smiles on their faces to help you find that magical toy to make a kid’s day, and consequently the parent’s day.

And yes, there was the piano you could dance on.

Toys “R” Us bought FAO Schwarz in 2009.

They closed all its locations, ending with the shuttering of the flagship New York store, in July 2015. Budget cuts, they said.

That year, the global toy market generated 85 billion dollars of revenue.

This past week, the new owners of FAO Schwarz announced that the iconic brand will reopen at Rockefeller Center in New York this November. As part of the product launch, according to the new owners, the store plans to hire “product demonstrators, magicians…and men and women playing various costumed roles, including toy soldiers.”

FAO Schwarz is holding auditions for people to dance on the piano. And get paid for it.

“We’re looking for people who can deliver that sense of theater,” said the chief executive of ThreeSixty Brands, the store’s new owner.

Sounds experiential. Sounds magical. Sounds like what a toy store should be.

This morning, the New York Times revealed that some old-school retailers are experiencing their strongest sales growth in years. That is, the ones that have experientially adapted.

Here’s the takeaway for radio stations regarding the Toys “R” Us closing and FAO Schwarz re-opening:

Radio, like toys, is, at its core, best when it is experiential.

Radio, like toys, is a form of theater.

Radio, like toys, can be magical.

Radio, like toys, is meant to be fun and memorable.

When toys are treated like a commodity, the business that treats it that way will suffer.

Same goes for radio.

Why Toys “R” Us Is Closing

Tuesdays With Coleman

Digital photography killed Kodak’s business.”

“Netflix put Blockbuster out of business.”

“Amazon put Toys “R” Us out of business.”

When an iconic brand goes under, the blame game always commences.

The truth is, Amazon didn’t put Toys “R” Us out of business. Neither did Target or Wal-Mart.

Toys “R” Us put Toys “R” Us out of business.

My colleague Warren Kurtzman wrote last week about how essential it is for every brand to have a clearly defined base position. But is that enough?

What’s a better base position than “the photography company”? Or “the movie store”? Or “the toy store”?

Kodak, Blockbuster and Toys “R” Us didn’t just have strong positions in their categories, they owned the dominant positions. The problem is, each of these brands lacked positive brand depth beyond their base positions.

An engineer at Kodak actually invented digital photography. In 1975. Navigating the consumer through the digital space using the brand equity of Kodak moments would have been a perfect and natural complement to its base position. Unfortunately, Kodak couldn’t see beyond its history as a film company, and competitors swooped in.

Blockbuster had an incredible, dominating base position. Unfortunately, it had negative brand depth in the form of late fees, which left it vulnerable. By the time Blockbuster removed late fees, it was too late.

If Blockbuster had entered the DVD-by-mail category or streaming category first, the company would quite likely still be around. Blockbuster had the chance to buy Netflix in the early 2000s for $50 million.  Today Netflix is valued over $100 billion, worth more than every media company that’s not named Disney.

Would Netflix have had that growth under the leadership of Blockbuster? Probably not, and that’s the point.

Netflix started as a DVD-by-mail company, but its base position centered around convenient entertainment delivery. All the moves and innovations Netflix has made, including doubling down on streaming and adding original programming, has been complementary to its base position. Netflix added brand depth.

Amazon started out as an online bookstore that became an online marketplace. Its moves and innovations, including ease of app use, marketing automation, customer service and free two-day delivery, have all supported its base position as an online delivery service.

Toys “R” Us had an enviable base position and an emotional connection to legions of children who wanted to be Toys “R” Us kids.

Where did the emotional connection go?

Although the road would have been challenging, Toys “R” Us could have added brand depth to its base position. It may have been through incredible marketing automation techniques (like Amazon and Starbucks) or hiring an ace social media manager (like Wendy’s). It could have been a research program that let kids test toys. It may have been partnerships with kids’ museums around the country.

Not to say any of those ideas would have definitely worked, but Toys “R” Us needed to try long before Amazon posed a significant threat.

Integrating Babies “R” Us into Toys “R” Us stores was definitely not the answer–it detracted focus from its own brand.

Last year, Toys “R” Us CEO David Brandon said the chain hoped to add playrooms where kids could try out toys and spaces for birthday parties.

Unfortunately, they never got the chance to give them a shot.

When we work with radio stations, we illustrate the base position on our Image Pyramid, but also explain the perils of a misguided Image Pyramid–which is what Kodak, Blockbuster, and Toys “R” Us all ran into.

Coleman Insights Image Pyramid

Clearly define your base position. Once you do, never stop adding brand depth.