[Brielle Buckler]

In this unit, we learned about how important it is for organizations to pay attention to the marketing environment for their line(s) of product(s) and/or service(s). We watched a video about Toys R Us, which went into liquidation in 2018 closing virtually all their stores throughout the world partly as a result of not focusing on the marketing environment.

This company essentially failed to adapt to a significantly changing marketing environment. They maintained their large-scale supermarket retailing model for over 50 years without considering trends in retail design, retailing itself, changing consumer needs, technology and online factors.

Based on what you read in this chapter and what you learned from the video and any additional research, list as many factors and changes that contributed to the decline in Toys R Us commercial success as you can think of. Categorize those factors into the main marketing environment components (social factors, demographic factors, economic factors, political and legal factors, and competitive factors) and rank the factors in terms of which ones were the most significant in the downfall of Toys R Us in your opinion.

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In order to receive full credit for this assignment, all components of this assignment are due by 11:59pm ET on Sunday, November 13, 2022. You should first contribute a thoughtful post of your own before viewing/commenting on the posts of others. You must respond meaningfully to at least two classmates to receive full credit for this assignment.

This assignment is worth a total of ten (10) points — 6 possible points for your original post, and up to 2 points for each of the two responses to your classmates’ posts. Students should review others’ submissions and comment meaningfully (refer to this guide from MMSU for reference) to at least two other students. For reference, here is the difference between a comment and a post — you will be using both for this assignment. Make sure to refer to our Discussion Rubric as you work on your submission.

• This topic was modified 2 years, 3 months ago by Brielle Buckler. Reason: Republish
• This topic was modified 2 years, 3 months ago by Brielle Buckler.
• This topic was modified 2 years, 3 months ago by Brielle Buckler.
• This topic was modified 2 years, 3 months ago by Brielle Buckler.

[Roshanna Young]

Toys R us has had some competitive factors such as signing an expensive partnership they had with Amazon that they impulsively made and unfortunately Amazon became a big competitor and it gave Amazon right the sale Toys R us products third-party. Though Toy R Us took Amazon to court to try to get out of the deal, Toys R us wasn’t financially able to proceed with it. Not only that they had to compete with companies that sold Toys online such as eToys, as well as stores saleing toys at more affordable prices and at a discount. Along with the growth of online shopping and kids being more into technology. The toy industry eventually declined. Toys R Us became 6.6 billion in debt forced to file for bankruptcy with no plan to emerge. In my opinion the most significant down fall from my understanding is the partnership they didn’t read thoroughly before signing. It seems that it is where the decline began. I also think them not having a financial back up plan for change such as having the money to make products more affordable when your competing with companies and also selling their products on line.

[Caden Lamont]

What contributed to the decline in Toys R Us commercial success was in 2000 when Toys R Us signed an expensive partnership with Amazon. This deal granted Amazon the rights to sell Toys R Us products on its website but later on, Amazon started to sell third-party in direct competition with Toys R Us. This led to a decline in Toys R Us commercial success because Toys R Us paid for exclusivity that they didn’t get. Toys R Us tried to take this issue to court but this left them additionally behind their e-commerce efforts. Also, more companies like Target, Walmart and Kmart would sell toys, undercutting Toys R Us for price. This would attract more people to buy toys from their companies, and not Toys R Us. Toys R Us stock started to decrease. Overall, competitors started to be more competitive with Toys R Us and this led to the downfall of Toys R Us.

[Isabella Miranda Lopez]

<p class=”p1″><span class=”s1″>What started as a baby’s furniture store, turned into one of the largest toy franchises in the world. Charles P Lazarus founded Toys R Us, and quickly became a public company in 1978. The decline of Toys R us would begin to emerge after the birth of e -commerce.<span class=”Apple-converted-space”>  </span>Toys R us had many factors that contributed to the decline of the company.<span class=”Apple-converted-space”>  </span>Each factor falls into the main marketing environment components, making it clear what exactly caused the company to dissipate.</span></p>
<p class=”p1″><span class=”s1″>The birth of the internet and its online consumerism would cause competition to arise for Toys R us. The company decided to partner with Amazon under a contract, where Amazon would sell their products exclusively. What Amazon didn’t mention was their business with competitor toy brands. Toys R us was furious and decided to sue Amazon to get out of their contract, causing Toys R us to loose money and time. </span></p>
<p class=”p1″><span class=”s1″>Meanwhile discount stores with many products began to rise in competition. These stores like Kmart and Walmart,<span class=”Apple-converted-space”>  </span>sold toys for discounted prices while making more sales.</span></p>
<p class=”p1″><span class=”s1″>These situations would be described as competitive and legal factors contributing to the fall of Toys R us. </span></p>
<p class=”p1″><span class=”s1″>Technology grew rapidly popular in consumers of all ages. Kids stopped wanting toys and desired tablets and video games ,causing an overall large decline in toys between 2012-2017.<span class=”Apple-converted-space”>  </span>This cause would be described as a competitive social factor. </span></p>
<p class=”p1″><span class=”s1″>In an attempt to recover Toys R us losses in sales, the company<span class=”Apple-converted-space”>  </span>took out large loans. This caused more harm then good and landed Toys R us in large debt. Once CNN publicly announced the the companies extreme financial struggles, toy brands stopped selling to Toys R us. This was one of the last events that pushed Toys R us into foreclosure and bankruptcy. These instances would be defined as economic and political factors. </span></p>
<p class=”p1″><span class=”s1″>The most significant factor that caused the infamous Toys R us to dwindle, would be the competition. Toys R us was met with several competitors who all found ways to attract more customers and sales continuously. </span></p>

[May Turgeman]

<p style=”text-align: left;”>Week C Assignment- Marketing Environment Discussion by May Turgeman</p>
Toys R Us failed to adapt to a significantly changing marketing environment.                                                            In my opinion, the most significant factor that has led to the downfall of Toys R Us from the beginning is the social and demographic factors of technology and online changes and needs. When online shopping started to develop all over the world, and the e-toys online store opened, Toys R Us signed a very expensive and not smart contract with Amazon to sell their products. instead of opening their own Toys R Us online store and making their store more accessible online for their clients/consumers. Toys R us didn’t create back than their own original online store that will be an attractive, welcoming, and easy-to-use website for their customers. They didn’t recognize their opportunity to grow online as the world became more and more technological over the years since then. In my opinion, they missed a huge opportunity to sell their toys online by themselves, and instead, they went to amazon which also sold their competitive company’s toys at better prices and relied on them. Which in my opinion is also a bad financial and economic move.

Toys R Us also didn’t consider the changing of consumer needs in terms of technology and the new generation. When their competitors sold video games, tablets, computers, and more technological products “modern toys”, Toys R Us didn’t recognize the changing market needs for “modern/ virtual/technological toys” and kept selling the traditional toys which obviously their value in the market went down and there was less need for them, from their customers.

The next factor that made a big impact on Toys R Us selling and that brought them to its downfall is the economic side in many different aspects. When the need for technology went up and the traditional toys went down, Toys R Us’s competitors sold the traditional toys at cheaper prices, and this is how they won their clients. Toys R Us didn’t change/lower their prices according to the market needs, and to their competitor’s prices, which led them to lose many of their customers since they could find the same goods for a better price online or in competitor’s stores such as Walmart, Amazon, etc. Another economic demographic factor is their big stores and the number of locations they rented and spend a lot of money on every month. Having walk-in stores is a big expense. If it is in a good and tourist location it can be very good for promoting the brand and opening people’s eyes to the brand/company. But in most walk-in stores, there are a lot of expenses and loss of money. When Toys R Us started to go down, they didn’t close stores in order to reduce their expenses and they kept losing money from it every month. While their competitors sell online and didn’t have walk-in store expenses.

Toys R Us also didn’t change their store’s design to a more trendy, nice, new, and modern style that will attract people to come and shop in as their competitor’s stores such as bed bath&beyond.

In conclusion, Toys R Us essentially failed to adapt to a significantly changing marketing environment and this is what brought them to their downfall for all the reasons I mentioned above. This is why good marketing strategies are so important for every company that wants to succeed.

 

 

[Elisjoe Ramirez]

Hey May i completely agree with everything your saying truly a very in depth analysis. Toy R US truly failed to modernize their appearance and adapt to electronic devices. Amazon quickly shifted and they have had great success for it.

[Syed Rahman]

I highly agree with you May as Toys R Us failed in directing consumer needs leading to their downfall. I also like how you mentioned how Toys R US didn’t progress in their designs keeping it the same and not heading into a modern/more trendy look.

[Liora Sarah Cohen]

Toys R Us<span class=”Apple-converted-space”>  </span>failed to adapt to e-commerce. While the world technology was moving fast, this company was not keeping up.

Amazon and Toys R Us partnered<span class=”Apple-converted-space”>  </span>in order to introduce Toys R Us as an online business. This was a 10 year deal. Later on, Tory R Us dealt with a big hit due to owing Amazon exclusivity and a portion of their sales. The only way of purchasing Toy R Us products was through amazon. Since Toys R us’s only chance of succeeding online was Amazon, they failed to do well and continued to be in a lot of dept. <span class=”Apple-converted-space”> </span>

This was a big mistake since they had no control over their online market place. They were not able to open their own online stores.

Another major issue was their extreme amount of competion. For example, Walmart, Target and many more big department stores starting selling toys. The products were modern and more reasonable.<span class=”Apple-converted-space”> </span>

All these struggles resulted in a lot of debt for Toy R Us. Their stock value decreased tremendously. And their debt sky rocketed.<span class=”Apple-converted-space”> </span>

<span class=”Apple-converted-space”> </span>

In my opinion, Toy R Us should’ve invested into opening an online store. They should not have relied on Amazon. Also, they should have found a way to lower their prices and modernize their stores.<span class=”Apple-converted-space”> </span>

[Aisultan]

Aisultan khussainov week c assignment

 

Toys R us could not adapt and prepare for a big and rapidly developing event like the digitalization of everything on the market. Also, she was unable to compete with everything that is on the toy market and everything related to them, because she was not prepared at all for the fact that everything would be digitalized in my opinion, market analysts of these companies are the main reason that they could not compete.

In my opinion, it was also a big mistake that they did not open their own website that would give the atmosphere of a store with their own design that would attract children and make everything simple for adults who would buy goods for their children. Since giving a large amount to Amazon was a big and one of the most significant mistakes made by this company and its executives, because before going to Amazon they had to see what kind of platform it was and what it does, and so they just gave a large amount of money when they were no longer the first on the market. a platform that will sell your product with the product of competitors is not the best idea. I believe that if she had created her own website with their own theme, it would have been cheaper and would have brought more profit, because on their website the buyer would not be interested in their competitor’s product and whatever he chose there would bring profit to Toys R us.

The third big mistake is that they are pushing their rake, they again could not foresee or prepare for the fact that children will become more interested in computer games or consoles. I think that after 1 big mistake they could pay attention to the fact that everything in the world was becoming more and more digital.

To summarize everything, I wrote to them all 3 mistakes that they made in my opinion.

1) They were not able to adapt
2)They spent a lot of money on Amazon, which sells their goods along with the goods of their competitors
3) They step on their own rake again and again

Things that in my opinion would be worth trying
1) I think it would definitely be worth lowering the prices of goods.
2) I think it would be worth trying to close several stores since you have to pay for their service and staff in the store and instead develop your own website so that it makes a profit
3)Redesign I think it is necessary for customers to see your store from the other side and perhaps be interested

In the end, using the example of this company, you can see what happens to those companies that are not able to adapt and predict the market.

[Aisultan]

Aisultan Khussainov

Toys R us was unable to adapt and prepare for such a large and rapidly developing event as the digitalization of everything on the market. Also, Toys R us could not compete with everything on the toy market and everything related to them, because it was completely unprepared for everything to be digitized. In my opinion, the market analysts of these companies are the main reason that they could not compete.

In my opinion, it was also a big mistake that they did not open their own website, which would create the atmosphere of a store with its own design, which would attract children and make everything simple for adults who would buy goods for their children. Since giving a large amount to Amazon was a big and one of the most significant mistakes made by this company and its executives, because before moving to Amazon, they had to see what kind of platform it was and what it did, and so they just gave a large amount of money when they were no longer the first on the market. a platform that will sell your product together with the product of competitors is not the best idea. I believe that if she created her own website with their own theme, it would be cheaper and would bring more profit, because on their website the buyer would not be interested in their competitor’s product, and everything he chose there would bring profit to Toys R us.

The third big mistake is that they step on their rake, they again could not foresee or prepare for the fact that children will become more interested in computer games or consoles. I think that after 1 big mistake they could pay attention to the fact that everything in the world is becoming more and more digital.

Summing up everything, I wrote them all 3 mistakes that they made, in my opinion.

1) They were unable to adapt
2) They spent a lot of money on Amazon, which sells their products along with their competitors’ products
3) They step on their own rake again and again

Things that, in my opinion, would be worth trying
1) I think it would definitely be worth lowering the prices of goods.
2) I think it would be worth trying to close a few stores, since you have to pay for their service and staff in the store and instead develop your own website so that it makes a profit
3) Redesign I think this is necessary in order for customers to see your store from the other side and, perhaps, be interested

After all, using the example of this company, you can see what happens to those companies that are not able to adapt and predict the market.

[Elisjoe Ramirez]

 
<p style=”font-weight: 400;”>        Toy R Us, a company that has a strong impact nationwide, specifically with kids.  They for a extended period of time dominated the demand for kids toys and desires. Creating a culture that pushed children to beg for something from Toy R Us. But little did Toy R Us know that time was ticking and these effective tactic was becoming a forgotten legend. There a number of reasons why they now don’t exist and throughout the writing it will be explained.</p>
<p style=”font-weight: 400;”>          One major reason Toy R Us failed to maintain its prosperous company is there inability to recreate. Toy R Us failed to adapt and understand that the times where changing. Toys were falling in demand and the world was rapidly shifting to virtual reality. The major audience of Toy R Us were definitely kids and toddlers. If only they adapted to point that can draw in a larger crowd. Build a Bear a great company that technically is a toy, but why are they still breathing and Toy R Us 6 feet under? Build a bear has a great target audience. You can buy a bear for your newborn child, or maybe your 90 year old grandma, or maybe you wanna grab the attention of your crush. Build a bear is a great gift for a larger group of people. Toy R Us simply had a small target audience, yet making them more susceptible to failure. In my opinion if Toy R Us would have found a way to draw in more adults with a new product that isn’t necessarily a toy, they would still be here. This is the reason why Amazon is so successful they are loaded with convenience but they carry products for all different ages and genders. Another reason Toy R Us was unsuccessful, was them failing to using marketing to their advantage. In our society, cosigning is huge. Whenever we see another celebrity approving a product it creates security in society to trust in the product. But the other hand many people idolize many celebrities and they consume a product mainly because a influential person consumes it. This is what we call a brand my friend. Everyone loves Yeezy because of who created the brand, Kanye has created a style that isn’t really ever put into consideration. Its more about how you feel, a sense of importance when wearing Yeezy because of the value it carries.</p>

[Masayuki Kirsch]

Masayuki Kirsch – Week C Assignment

Toys r us

Established in 1957, Toys r Us dominated the Toy industry for a lengthy period. It was even one of the most prominent companies in its era. However, many poor decisions and additional factors eventually led to its ultimate collapse in 2018, when the company officially went into bankruptcy: Economic, Legal, Social, Demographic, and Competitive factors.

 

Demographic and Social Factors provided the least amount to the company’s downfall. According to Statista, “During a 2021 survey conducted in the United States, data illustrated that 88 percent of children aged between 13 and 18 years had a smartphone in their home, while 57 percent of kids between eight and 12 had one.” The current demographic of people utilize smartphones much more compared to the percentage in 2004, where “45% of teens (age 13-18) had cell devices” (pewresearch). That is a 43% increase over more than a decade where children and teens prioritize phones over toys. The toy industry was contracting as children of this generation favor electronic devices, and Toys R Us couldn’t adapt their branding towards an entirely new demographic.

 

The most significant factor that played into their continuous downfall was their debt. For being such a large corporation in the early 2000s, the company went into a deal with amazon, which entrapped them into a longing excruciating financial downfall. This is due to Amazon’s ability to sell third-party products, which ruined the partnership benefit which costed so much. This led to competition to rise, which much more significant sums of money to market their brand. This fatal mistake caused a chain reaction of more minor financial issues and errors later in an attempt to recover the loss of income. As the years progressed, money dwindled as the company couldn’t truly invest in its brand and instead was required to spend it on its debt. Simultaneously other brands are growing in wealth and investing much more. Circling back to the change in demographic, the company couldn’t revolve its products around the customer’s wants and reeds due to its lack of resources. Money drives the entire operations as 40% of ventures refused to ship products without cash on delivery. The inefficient expenditures resulted in the company’s bankruptcy in 2018.

In conclusion, Toys R Us made crucial financial mistakes early on, resulting in numerous issues stemming from that event. The company’s lack of efficiency in financing properly ultimately caused internal destruction and resulted in its failure to sustain itself against its competition.

Lenhart, A. (2020, August 27). Teens and mobile phones over the past five years: Pew Internet Looks Back. Pew Research Center: Internet, Science & Tech. Retrieved November 13, 2022, from https://www.pewresearch.org/internet/2009/08/19/teens-and-mobile-phones-over-the-past-five-years-pew-internet-looks-back/

[Syed Rahman]

The fall of Toys R US shocked us kids even me when my nearest store closed for good. I didn’t know why at that time. Now with the research, the most significant factor for the company’s downfall is not appealing to the demographic factor and feeding into consumer needs. The toy industry was booming when the company started, but kids were more into electronics and video games. My first ever DS was actually from Toys R US. They would still be here today if they pushed to that industry, something like GameStop for example.

Now another big factor in their fall is the economic and legal factors altogether. They signed a contract with Amazon distributing their toys in the e-commerce industry. Economically wise they also failed there as they didn’t pursue e-commerce, which started booming. Amazon however wasn’t on the same team as Toys R US as they also started selling toys with third-party companies and competitive companies at a lower price. Then trying to go to court with Amazon just went even worse for the company as they lost the case and were economically down more. With competitors such as Walmart, Target, and Kmart kept selling at a lower price for toys, which drove customers away. Now with being in a crazy amount of debt vendors didn’t want to sell to the company anymore unless it was a straight cash drop-off.

The company had no uplifting ideas at the time and there was nothing else left to do besides file for bankruptcy. Now when a company actually files for bankruptcy, there is actually a way to rejuvenate and rebuild it with the filing that the company tried to structure out. However, it just wasn’t worth it and they needed to liquidate and close all stores across the United States.

To allude, Toys R US failed to market their company through the decades which led to its demise. By failing to feed consumer needs and not reaching the demographic factor, they ultimately failed. However, the Toys R US story isn’t actually done with this video. They actually have one flagship store open in American Dream Mall which I’ve seen myself in person. Now the way they marketed the location was very clever as it is called “America’s world’s largest mall” so there will be a lot of foot traffic. Now the mall is actually facing a lot of debt issues as well but that is another story to tell.

 

[Faten Gondal]

Toys R Us, the company founded by Charles Lazarus in the 20th century, was one of the most known and successful international toy retailers of its time. But they had not known that they could decline and run out of business. And this is exactly what happened. But what caused its downfall? There were many factors that were behind it, but the biggest factor was its inability to focus on its marketing environment and to adapt and adjust according to the changing marketing environment.
A marketing environment is a set of factors that influence a company’s marketing activities. The Toys R Us company was unaware of what was coming. It was the beginning of the dot com era and the rise of e-commerce and that of the retail establishment, the Big-Box store. When Toys R us became aware of the situation, they made a strategy to partner with Amazon. They gave Amazon the exclusive rights to sell their products on their website. But Amazon, on the other hand, started selling items from a 3rd party, in direct competition to Toys R Us. This was the second factor that led to their decline. They were not mindful to consider all the possible scenarios and aspects about the deal before making it, instead they made the decision without proper strategy and planning. They could have included the term in the contract, that Amazon must not sell products to its competition. Furthermore, the deal was not a good idea as what they required was their own website. During the rise of e-commerce different companies were creating their own websites or investing into e-commerce. But when they finally opened their own e-commerce website, it was too late.
The company opened in the 20th century, but it now had entered the 21st century, that had a different generation, different from the older generations in their preferences, likes and dislikes and overall perception. Changing preferences required a change in products, innovations, and different approaches, in accordance with the mindset of the new generations. Today’s children and kids have moved from playing with toys to playing video games, computers, and tablets. The company needed to add and create products aside from just toys. They could invest in creating electronic toys or selling video games.
Another factor that led to Toys R Us’s failure was that their competitors were always ahead of technology and innovation in comparison to them. Amazon, Walmart, and Target started selling toys in direct competition with them. The sales and reductions in their prices during holidays were the final blow to Toys R Us. They eventually had to file for bankruptcy and were forced to liquidate their stores.
In today’s world, changes are happening every day, whether it’s the changing economy, trends in businesses, global changes, or changes in preferences. Today’s world is a changing world. Apart from all of that, we have our changing marketing environment, which is a huge factor to consider for a company to remain in business and be successful today. Toys R Us ignored this important aspect. For me this was the major factor. They remained unchanged and the same, while other brands were constantly changing to adapt to the new marketing environments. Since at a time they were the most successful toy store, they thought that it will continue to remain as it is. It was this mindset that caused them failure.

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