Photo: Toys ‘R’ Us
In its latest attempt to combat “showrooming” — the practice of trying out a product in a brick-and-mortar store before going online to make the final purchase — Toys “R” Us is releasing a tablet for kids, reports Ann Zimmerman at the Wall Street Journal.It’s called the Tabeo, and it will available exclusively at Toys “R” Us for $149.99. That means you can’t try it out in the store and then buy it off of some other retailer’s website for less.
Toys “R” us is taking a significant risk by releasing its own tablet.
“The downside to private-label products is if they flop, and have to be discounted, the retailer can’t beat up the manufacturers,” Needham & Co. toy analyst Sean McGowan tells the WSJ. “That’s not an insignificant part of the toy business.”
Toys “R” Us has been struggling lately, largely due to price competition from retailers like Amazon, Walmart and Target. Sales have remained flat while profits have declined over the past two years.
Showrooming is a tangible issue for toy retailers, though things aren’t as bad as they are in consumer electronics or apparel. A report from comScore in April showed that 22 per cent of customers have bought toys online after showrooming, compared with 63 per cent for consumer electronics.
The Tabeo goes on sale on October 21st, just in time for the holiday season. You can preorder online at Toysrus.com.
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