PM305
International Marketing
Assignment Questions
Background Instructions :
• All learning outcomes will be assessed. This summative assessment represents 50% of total module
marks.
• Carefully read the case study and the assignment questions before answering the questions. You
need to undertake additional environmental and academic research beyond this case study.
A case of Toys “R” Us, Inc. looking to international Market [1]
Toys “R” Us, Inc. was founded in 1948 and is based in Wayne, New Jersey.
Toys “R” Us, Inc., together with its subsidiaries, operates as a retailer of toys and baby products. It
operates through two segments, Domestic and International. The company offers products for
newborns and children up to four years of age. It also provides educational electronics and
developmental toys consisting of Imaginarium products in the United States and World of
Imagination products internationally; and construction toys, games, creative activities, and preschool
merchandise. In addition, the company offers seasonal products, including toys and other products
for holidays and summer activities, as well as bikes, sporting goods, play sets, and other outdoor
products.
Sales and Marketing
The toy retailer utilizes a variety of marketing and advertising channels to reach its target audiences.
Its mass marketing programs include email marketing, national television and radio spots, direct mail,
targeted magazine advertisements, catalogues and ads in national or local newspapers. Other
strategies include targeted doortodoor distribution, direct mailings to loyalty program members, and
instore marketing.
“What differentiates Toys”R”Us as a specialty toy retailer is the memorable shopping experience we
provide for our customers,” said Andre Javes, managing director, – Greater China and Southeast Asia.
He added. “This includes a combination of the widest assortment of toys and baby products,
including exclusive items not available anywhere else in the market, fun store layouts, interactive instore
experiences, product displays and demonstrations, activities and more.”
As of January 30, 2016, it operated a total of 1871 stores; 361 traditional toy stores, 224 baby
stores, 213 SBS stores, and 68 Permanent Express stores, as well as Temporary Express locations in
the United States; and 756 operated and 252 licensed stores in 38 countries and jurisdictions
worldwide. It generated 62% of its total sales from its US stores during FY2016, another 10% from
Europe, and 10% from Japan. The company’s other major markets are in Canada (7% of sales), the
UK (6%), China and Southeast Asia (3%), and Australia (2%).
The retailer’s revenue tumbled 5% to $11.8 billion in fiscal 2016 (ended January 30, 2016), mostly
because of unfavourable foreign exchange rates tied to the stronger US dollar. Excluding foreign
currency impacts, however, net sales increased slightly thanks to new International store openings
and comparable International store sales growth of 3.2%, driven by higher baby gear/apparel and
construction toy sales.
Toys “R” Us has experienced declining sales despite its being the only truly global toy store chain and
a strong brand name. It has suffered from declining demand in most mature markets as population
ages and birth rate fall. Furthermore, new competition has arisen with pure players and grocery retailers expanding their range of toys and baby products. The company had faced huge competition
from specialist toys stores and retail superstores like Tesco, Walmart (Asda) etc in its major
international operations.
Strategy
To turn around its situation and set the company up for longterm profitability, the retailer in 2016
reiterated its customer convenienceoriented strategy to integrate both its online and brickandmortar
offerings by utilizing its “InStore Pick Up,” “Ship from Store,” and “Ship to Store” fulfilment
channels.
Since then company has introduced its ‘TRU Transformation’ strategy. A new service model will also
be introduced into Babies R Us stores to help firsttime parents have a better shopping experience,
along with expanded parenting classes. In addition, mobile devices will be rolled out to store
associates, in recognition of the growing importance of this channel. Toys R Us is putting more
emphasis on becoming a customercentric company, giving the retailer a competitive advantage over
bigbox discounters such as Walmart, Tesco, Target and Amazon. Toys R Us will take customer
insight into consideration to make the instore and online services an exceptional experience for
multichannel shoppers.
Future International Strategic focus
The toy retailer also continues to expand its stores globally as the US market continues to mature,
opening its 100th store in China in January 2016.In terms of international growth, Emerging markets,
Southeast Asia and China remain the key areas of focus. “International growth remains an important
area of investment for the company and we continue to see significant opportunities for expansion,
said Antonio Urcelay, Chairman of the Board and CEO, Toys”R”Us, Inc.
Expansion into international markets is crucial for Toys”R”Us, However, the questions are how and
where? The company is exploring its options to expand into ONE of four major markets, namely
India, Sri Lanka, Nigeria and Russia.
Sources used :
[1] https://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=190358
[1] https://www.vault.com/companyprofiles/retail/toysrus,inc/companyoverview.aspx
[1] https://www.retailweek.com/topics/international/internationalnewsanalysistoysrusunveilsturnaroundstrategy/5073429.article
Word Limit: 2,500 (excludes appendices) words (Plus or minus 10%)
Learning outcomes assessed:
1. Identify the principal managerial issues and policies necessary for success in international
marketing.
2. Examine and evaluate methods of identifying and qualifying market potential in different parts of
the world.
3. Illustrate the nature of overseas distribution systems (including agents and joint ventures) and
demonstrate the marketing implications of differences in culture in consumer behaviour.
Academic Misconduct
You are responsible for ensuring you understand the policy and regulations about academic
misconduct. You must:
• Complete this work alone except where required or allowed by this assignment briefing paper and
ensure it has not been written or composed by or with the assistance of any other person.
• Make sure all sentences or passages quoted from other people’s work in this assignment (with or
without trivial changes) are in quotation marks, and are specifically acknowledged by reference to the
author, work and page.
