Bankruptcy is a dirty word to most people. It signifies failure and total loss, or rock bottom, as it were. But is it the end of the line? Does losing everything really mean that all is lost? Or is there a way back? Well, we already know that there are many people who have bounced back after going bankrupt, so surely it can work for retail giants? Perhaps with the right strategies, it is possible for post-bankruptcy stores to survive in a highly competitive, omni-channel world!
In this article, we’re going to look at the methods that Toys R Us (or Tru Kids) and Sears have been adopting, in order to re-establish themselves. Clearly, whatever they were doing in the past wasn’t working for them. Which is why they are now embracing the modern market and introducing new and innovative ways of delivering a retail experience to their audience.
Toys Were Us
Let’s start with Toys R Us, as you all know went into liquidation last year (2018). Their biggest failure was neglecting to embrace the online market quite as much as they should have. Yes, it is incredibly difficult to contend with the likes of Amazon, who are absolutely dominating the market. However, they could have been looking at other avenues of survival. Unfortunately, it took bankruptcy to prompt executives to start implementing genuine change. That said, there’s no good crying over spilled milk; all one can do is clean it up and pour another glass.
But hey! Everybody loves a good comeback story, and by the looks of it, Toys R Us could be bringing us exactly that. They’re re-inventing their brand as we know it, and the way that their stores function. Rather than the drab warehouses that they devolved into; Toys R Us stores will now be much more customer-centric with an emphasis on fun! Instead there will be open play areas where children and parents can interact and test new products; there will be designated spaces for various special events, including birthday parties. Their full business model hasn’t been mapped out just yet, but executives have let on that there will be some big changes, investing much more in their stores and local communities.
And then we have Sears Holdings, who also filed for bankruptcy in 2018. A difficult year for retail it seems, as the e-Commerce market continues to thrive exponentially. That said, these drastic measures that Toys R Us and Sears Holdings have been faced with, have inspired a new way of retailing! It has forced them to reinvent their approach, and to create an immersive experience that e-Commerce stores would never be able to achieve.
Similarly, to Toys R Us, Sears are now heavily focusing on in-store experiences. They’re building on intellectual property (brand name, house brands etc), and their strongest product categories, especially products that require hands on demonstrations (e.g., mattresses, TV’s, kitchen appliances).
Each store will include a “welcome” service desk, where customers can meet with Sears Home & Life experts to explore how new appliances would look in a full-scale kitchen, among other things. This is in an attempt to demonstrate that whilst shopping online certainly has its perks, there’s something irrefutably attractive about being able to hold a product in your hands before parting with your money. In addition to that, receiving face-to-face, expert advice from people who understand the products, offers far more insight than an FAQ ever could.
So, what does the next six to twelve months have in store for Toys R Us and Sears Holdings? Are we going to see a strong comeback for them both? Is this new, customer / store-centric approach the key to competing with e-Commerce giants such as Amazon? Only time will tell!