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May 1, 2024
Will the Toys“R”Us and WHSmith UK Expansion Help the Retailer?
WHP Global, the parent company of Toys“R”Us, has recently entered into a significant agreement with WHSmith, a leading global retailer, solidifying WHSmith as the sole shop-in-shop partner for Toys“R”Us in the United Kingdom.
This long-term license agreement grants WHSmith exclusive rights to operate Toys“R”Us shop-in-shops in its High Street stores. It also marks a pivotal moment for both companies, with WHSmith set to open 30 new Toys“R”Us shop-in-shops in its High Street stores throughout the upcoming summer season.
The strategic partnership builds on the success of previous Toys“R”Us shop-in-shops launched in select WHSmith stores last year. Additionally, it underscores WHP Global’s commitment to expanding the presence of Toys“R”Us across the UK retail landscape, providing accessibility and convenience to the next generation of Toys“R”Us kids.
Stanley Silverstein, chief commercial officer at WHP Global, expressed enthusiasm about the partnership, citing the positive response so far to the introduction of Toys“R”Us shops within WHSmith locations. “This aligns perfectly with our overarching strategy to grow the Toys“R”Us brand in the UK through diverse channels including flagship stores, ecommerce and travel retail,” he stated.
Sean Toal, managing director at WHSmith High Street, echoed Silverstein’s sentiments, highlighting the delight of customers with the launch of Toys“R”Us in WHSmith stores. “We are excited to have signed a new exclusive agreement which extends our partnership with the brand,” he said. “We look forward to bringing the magic of Toys“R”Us to even more WHSmith customers across the UK.”
The partnership between WHP Global and WHSmith reflects a mutual commitment to delivering exceptional value and variety to customers, according to the press release. By leveraging the strengths of their respective retail expertise, both companies aim to provide an “unparalleled shopping experience.” This experience will integrate the iconic Toys“R”Us brand, including the beloved mascot Geoffrey the Giraffe, into WHSmith’s retail ecosystem.
After closing all stores in the UK in 2018, Toys“R”Us has made a comeback through this partnership with WHSmith. This initially started when the UK company purchased the rights to relaunch the Toys“R”Us website in 2022. Next, it tested in-store concessions in nine WHSmith stores across various locations. Now, the company plans to add the shop-in-shops to 30 more WHSmith stores by August 2024. These concessions offer a curated selection of popular toys like Barbie and Hot Wheels, along with interactive experiences for young shoppers. The product range will be regularly updated, and customers can also explore the full selection online.
As the partnership evolves, both companies are dedicated to keeping customers informed about new store locations and opening dates.
Discussion Questions
How does the partnership between WHP Global and WHSmith reflect the evolving nature of retail collaborations in revitalizing iconic brands like Toys“R”Us?
Amid digital dominance, what does the expansion of physical retail, seen in Toys“R”Us shop-in-shops in WHSmith, say about the enduring appeal of experiential shopping and driving consumer loyalty?
What strategies can other legacy brands use to reinvent themselves in today’s competitive retail landscape while preserving brand identity?
Poll
Loading …BrainTrust
Sarah Pelton
Partner, Cambridge Retail Advisors
Neil Saunders
Managing Director, GlobalData
David Biernbaum
Founder & President, David Biernbaum & Associates LLC
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I can see why WHSmith would want this. It’s something to add to their high street stores that should help to drive some footfall and incremental revenue. Given that the high street business struggles (latest full year revenue is down 19% compared to 2019) this should be useful. That said, WHSmith’s stores are not huge (3,209 square feet on average) and they can’t shrink their existing stationery, news and books offer by too much, so this is going to be a relatively focused toy offer that falls a long way short of Toys R Us’s category killing heritage. The other challenge for Toys R Us is that many of WHSmith’s stores lack good retail disciplines. But then, Toys R Us did partner with Macy’s, so I guess this isn’t too much of a concern! Bottom line, this increases visibility, but will it really compete well with more specialist toy players like Smyths and the Entertainer?
This is smart move especially in WHS stores that are in airports or rail stations. With the exception of retailers like a Harry Potter shop, there are no real toy options in an airport or rail station. You can’t be all things to all people in WHS shops, no matter where, but you can really provide an affordable, curated assortment if care is taken and the UK can cultivate the relationship with Toys ‘R Us and build the customer loyalty at same time.
The only thing is that the WHS travel stores (airports and especially train stations) are small so the offer would have to be very condensed and it wouldn’t be all that impactful. That’s probably why this deal is focused on high street locations. Also, bigger UK airports – Heathrow, Gatwick, Manchester – do have toy stores in the form of Hamley’s.
Point taken. I had forgotten about Hamley’s – a long established and revered toy retailer.
Neil,
Do you see this expanding to the WHS stores not in the UK? (And I mean the international stores overseas) Probably would be a harder sell, but….
Maybe, but a lot of WHS’s international locations are travel stores, so run up against the issue of space (though there are some larger travel outlets that could accommodate). Plus some of the business is made up of other fascia like InMotion, which would not really be suitable for a toy offer. So I don’t think this will be a focus for the TRU partnership.
Some InMotion stores are beside the WHS stores in airports for example. To your point, some a limited InMotion assortment inside WHS stores. But yes, probably a stretch. In the US, for example, WHS operates Lego stores(apart from WHS convenience stores) in some airports as well.
RW’s curious preoccupation with TRU continues: unfortunately, the never-ending coverage is in no way justified by actual results, which seem to consist mostly of a series of partnerships (most famously with macy*s, and now with a British retailer.) This may – or may not – be a way to make money, but I’d scarcely call it “reinventing a legacy brand”..I’d call it running a toy concession.
Candidly, this is a nothing burger much the same as other TRS mergers, partnerships and licensing agreements. Shop in Shops do very little to reboot a once monster brand. In fact, I believe it has an opposite effect. Db
Being only familiar with WH Smith in the U.S., my first reaction was that WH Smith High Street was something different. Neil Saunders clarified that. They aren’t much different.
That being said, the reality can not possibly match the hype in today’s discussion. TRU will give its name to a relatively small selection of items, and WHP will make some easy licensing money. There is nothing in this story that suggests a great comeback for TRU. The WHP strategy is evident from their previous endeavors. Skim what you can and don’t invest. And if you don’t have to operate, all the better.
The high street stores are bigger than most travel stores. But they have also received far less investment and some of the shops are in pretty bad shape. That said, I think this partnership will go into the better, larger stores in select locations.
I am familiar with WHSmith stores only through quick stops at US airports.
If the stores in the UK are similar then what will Toys ‘R Us get? A 5’ wall? A spinner rack? Still, this TRU kid is excited to see Toys ‘R Us back in any form.
Expanding Toys“R”Us within WHSmith shops benefits both brands, offering a wider customer base access to beloved toys. While challenges exist, leveraging WHSmith’s locations maximizes visibility, provided. It’s a smart move, enhancing convenience and potentially attracting foot traffic, fostering customer loyalty in the UK retail landscape.
Even with online shopping everywhere, the growth of physical stores within stores, like Toys“R”Us inside WHSmith, shows that people still love shopping in person and it really keeps them coming back. Customers enjoy the hands-on interaction and face-to-face chats you just don’t get with digital shopping. Classic brands like TRU play on nostalgia, making brick-and-mortar spots more appealing. Teaming up with established retailers helps these brands reach more people and tap into existing shopper flows, boosting their chances for more promotions together. Features like fun displays and events in stores make shopping more engaging, strengthen customer ties, and keep them returning. Plus, the top brands mix their online and in-person shopping smoothly, offering a uniform shopping vibe.