Spring 2008 international mktg - toys r us (2)
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Toys "R" Us opened its first international store in Singapore in 1974 and its first store in Japan in 1992. The Japan store saw large customer traffic and sales of $15-20 million compared to $10 million for U.S. stores. However, the company also faced challenges including Japanese laws limiting big store sizes, high land prices, import costs, and cultural differences around individualism versus collectivism. Over time, Toys "R" Us adapted by opening smaller stores, partnering with McDonald's, and becoming more integrated and accepted in local communities. Lessons included not always replicating the American model and better cooperating with local customs.
Spring 2008 international mktg - toys r us (2)
- 1. Toys ¡°R¡± Us Aaron James & Amber Alcaraz International Marketing Case Study April 14th 2008
- 2. Background ? Founded by Charles Lazarus (1948) ¨C Sold baby furniture at fathers shop and renamed it children¡¯s ? First baby furniture and children toy supermarket (1952) ? Introducing Toys ¡°R¡± Us (1957) ? 51 locations (1974) ? $ 1 billion dollars (1983) ¨C Went over! ? 1st international store in Singapore
- 3. Grand Opening of TRU Japan ? Tuesday January 6, 1992 ? In Kashihara, Naraken, Japan ? President Bush appeared ? 5,000 people and 2,000 policemen
- 4. Post TRU Japan ? Large customer traffic -$15 to $20 million compared to U.S. store bring in about $10 million in sales ? Helped other local business ? Run on push system
- 5. Opportunities ? Second Largest Toy Market ? Childhood Spending for children is high ? Japanese ready to pay high prices for toys ? Growing rates in toys
- 6. Bumps along the way ? Big stores law 1974 ? 3 year battle to open 1st store ? Price over quality ? Changing of local toys ? Mom and pop store close with community ? Smaller stores ? Local Business demand size reduction ? Individualism vs. Collectivism ? High Land Prices ? Import costs ? Location problems ? Training challenges ? Japanese Customs ? Negative perceptions of warehouse labor
- 7. Decisions Made ? Store within a store ? More Catalogs -Big toy catalogue -Videogame and electronic toys ? Joint venture with McDonalds
- 8. How do they stand now? ? Shoplifting rare ? Introduced discounts ? Gives choice to consumers
- 9. Has Japan as a market changed? -There is a better look at larger stores -Helped Japanese retailers -More choices in toy shopping
- 10. Current Issues? ? Large earthquake in 1995 ? Negative growth in 2003 -Opened new stores that helped increase sales ? Gradually becoming accepted by community
- 11. Suggested Actions ? More research needed -Market analysis ? Better integration into community
- 12. Lessons Learned ? Transition not always easy ? Doing everything the American way ? Cooperation with Japanese customs ? Smaller warehouse ? Direct communication with toy venders
- 13. Could this have gone better?