If there's any doubt left among retailers about the advantages of shops-in-store, it seems to be fading steadily. On Wednesday (May 29), Toys R Us officially launched a 1,000-square-foot shop-in-store featuring children's cable channel Nickelodeon, Chain Store Age reported.
The "Nick Store" is on the ground floor of the chain's flagship store in Times Square, and includes New York-branded apparel, toys and home goods, along with Nickelodeon-branded toys, books and DVDs. Toys R Us has not announced whether it plans to expand the in-store shops to its other 870 stores.
The reputation of the shops-in-store idea took a hit after JCPenney's (NYSE:JCP) catastrophic effort to remake its stores to include large villages of in-store branded shops. While the department-store chain was successful with in-store Sephora shops, which had much higher sales per square foot than other parts of Penney's stores, former CEO Ron Johnson's attempt to duplicate the Sephora success with dozens of other brands foundered under his separate policy of eliminating sales, discounts and coupons.
But Best Buy (NYSE:BBY) has had better success with its in-store "Samsung Experience" shops, which that chain has placed front-and-center in many of its stores. Those shops are staffed with Samsung specialists instead of Best Buy's usual associates.
The Toys R Us-Nickelodeon collaboration seems like a likely success, if only because the "Nick Shop" drives store traffic and also gives Nickelodeon a relatively inexpensive foothold in tourist-heavy Times Square. But unless Nickelodeon decides to expand the program—and figures out how to make it profitable—it's just a little more evidence that those branded shops really have a future.
- See this Chain Store Age story
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