Strategic lessons from the Toys R Us death

I have to admit: a part of my childhood died when Toys R Us filed for bankruptcy. I vividly remember going to their stores, playing with every toy on my wish list while singing their jingle (“I don’t wanna grow up because if I did, I wouldn’t be a Toys R Us kid!”). My wife and I still own the Monopoly set we bought—at Toys R US—when we were in college.

When news broke that Toys R Us would close all of its remaining U.S. stores many people blamed Amazon as the culprit. But according to CNN Money, Amazon was not the culprit. They noted “The company’s biggest problem: it was saddled with billions of dollars in debt. That debt stopped it from making the necessary investment in stores. And that mean an unpleasant shopping experience that doomed the chain. (emphasis added).”

So what can credit unions and banks learn from Toys R Us? Here are four strategic lessons from the death of Toys R Us:

  • Invest in the consumer experience—As Greg Portell, lead partner at retail consultant A.T. Kearney said of Toys R Us, “If you’re going to have that breadth of inventory, you need someone in the store to help you experience it.”

 

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