Toys R Us and Neil Friedman: What it really meant!

On April 20 of this year I wrote a piece entitled:  “Neil Friedman, Toys R Us and what it may really mean.”
  At the time, Neil had just accepted the position of President of the US Division.  He was previously been president of Mattel brands and considered one of, if not the, top product people in the toy industry.

So, upon his appointment to the Presidency of a retailer, I asked the following question:  Why would Neil, whose most recent and by far largest body of body of work has been on the product side, be hired for a retail position.  At the time I speculated as follows: “[I]it seems logical to me that Toys R Us has bigger plans for Neil’s strengths in manufacturing.  Is it possible that they not only plan to use Neil to expand their private label business (Toys R Us just opened a new Shenzhen sourcing office) but to help them develop into a full-fledged manufacturer as well? 

That blog posting turned out to be one of the most heavily read pieces we have published.  So, it was of great interest to me when my contacts filled me in on Jerry Storch’s comments regarding Neil at the September 14, 2011 Toys R Us Analyst Update on September 14, 2011

Jerry introduced Neil, not only as President of the US Division but also as “Head of Product Development.   Jerry went on to call Neil “the best product guy in the industry.” 

In addition, the Neil’s official bio for the event included this added aspect of his job description: Oversees

all merchandising, marketing, store operations, merchandising presentation, global sourcing and product development as well as merchandise planning and allocation.   

Words are one thing.  Actions are another and you can already see the results of Neil’s efforts.  Here is a quote from a Mainstreet article entitled, “Toys R Us expands exclusive toy offerings:”

Toys R Us, based in Wayne, N.J., always has offered exclusive toys, but this year it's "dramatically" expanding the number… They include store-brand toys… The Company also plans to promote its exclusives more, starting with a 44-page direct mailing Friday promoting deals on 350 of them.

It is my understanding that many of these exclusives are Toys R Us branded toys and that they are being positioned as premium products.  Toys R Us is changing the way the game is played and the hire of Neil Friedman may well turn out to be one of Jerry Storch’s best moves.

4 thoughts

  1. Richard,
    Recently I had a conversation with an eye doctor whos daughter is in medical school. He related she has to decide on a specialty, which is problematic because of the advent of computerization, dominating some medical specialties, making certain specialties obselete. Would it be beneficial for the toy industry consider this challenge as well. N.F. Richman

  2. Hi Richard,
    There is a great need for innovation. I’ll bet most of the private label products are the non-proprietary evergreens that are market tested. The items TRU and others know will sell through because they always did when they were branded. The only way to compete is to create new brands and products and take the chances that a private labeler is not going to. Otherwise, you will see Losier shelving filled with the stuff you used to sell. I think we lost a lot of control of our destiny when we went from manufacturers to marketing organizations to just middlemen. There has always been a plot to eliminate the middleman, unless the role provides real value. There is a big difference between central role and middleman.

  3. Hi Richard,
    It is great move and I wish Toys R Us all the success.Though I was no where near the level of Neil, but I know that it works very well in retail for a person who worked in No1 toy company in the world.I worked for Hasbro’s Indian joint venture partner for 18 years and when I joined a retail chain handling toy section the first thing I did is sourcing private label toys which in 2 years contributed 30% of total sales and operating margin went up by 50%.
    I wish Neil big success in his new adventure

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