Toys R Us Expands Outlet Mall Strategy

The retailer has shifted a portion of its strategy to focus on increasing its presence at outlet centers.

Iconic retailer Toys R Us has continually lost market share over the past few years due to ongoing price wars with other larger and less-specialized retailers, as well as the ongoing explosive growth in the area of e-commerce.

The company now has 30 locations in outlet centers, including a recently-opened spot at the Jersey Shore Premium Outlets. Toys R Us began targeting outlet centers in 2010, and typically takes up between 2,500 and 5,000 square feet for an outlet location, significantly less than the 45,000 square feet it typically takes up in one of its big box locations. Outlet centers have been increasing as a whole over the past few years, with 41 opening since 2012 to bring the total number of North American outlet centers to 215, and there are 60 more in the pipeline, according to research from Value Retail News. 

Outlet centers are also allowing Toys R Us to better focus its efforts in product offerings. Some of the items offered for sale are exclusive to the outlet center locations, which also offer all the popular brand names you would expect from one of their typical stores. The strategy has been given the thumbs up from at least one analyst.



“For the last seven years Toys R Us has been losing market share primarily to Walmart. Toys R Us wins when the consumer wants a great selection, Walmart wins with great prices,” said C. Britt Beemer, CEO of America’s Research Group. 

While shoppers increasingly turn online to fulfill their needs – or at the very least to compare prices – there’s still hope for retailers in one key element that can’t be satisfied online. 

“People definitely go online and do a lot of price comparison, but some people prefer shopping and going into a store to touch, feel and see. Grandparents and more traditional (people) might feel more comfortable shopping in-store,” says Adrienne Appell, a trend specialist with the Toy Industry Association. 

One of other key battle that’s facing the toy industry is one that has affected numerous other industries- technology - but Appell believes that simply ‘playing’ is making a comeback.

“People are taking notice that play is an essential part of a child’s life. We’ve seen an uptick of that movement. People are making a conscious effort and deciding to shut off their phone and play a game with their family,” she said. 

Related shopping malls and stores:

Toys R Us

Toys R Us

More about shopping malls in the USA