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Once partners, and become rivals in the toy world

Once partners, and become rivals in the toy world and _ partners in the online toy world since 2000 _ have become staunch rivals this holiday season, battling for consumers' share of dollars for toys.
The two severed ties following a ruling in March from a New Jersey superior court judge who found that breached a deal to give Toys R Us Inc. exclusive rights to supply some toy products as a third-party vendor on The company is appealing the court decision in an effort to reinstate the online retailing pact, though officials declined to comment on the status.
For now, both are armed with an expanded number of toys and new services in an effort to drive shoppers to their sites this holiday season., which teamed up with a year after its disastrous 1999 holiday season _ when some customers got their toys delivered after Dec. 25 _ is making sure not to repeat that logistical nightmare. The company, which launched an independent web site July 1, teamed up with logistics expert Excel and e-commerce expert GSI Commerce Inc. in May to bolster its and sites. It opened a new fulfillment center in Groveport, Ohio, in September.
These two rivals will also have stiff competition from online auction house eBay Inc., as well as and, both of which are expected to be aggressive with discounting.
This is only good news for shoppers, who will have expanded assortment and services. Toy makers also expect to see their online toy business expand at a time when the toy industry is struggling with stagnant growth.
Roger Schiffman, CEO of Zizzle LLC, believes that the two separate sites will give a 20 percent to 30 percent boost to his company's online sales.
"All of a sudden, it is like adding more online stores," he said.
According to NPD Group Inc., a market research group in Port Washington, New York, sales of traditional toys have averaged a 2.9 percent decline from the January-August period, even as makers are trying to come up with new electronic toys that excite children who are growing out of toys faster.
Sales of traditional toys, which exclude video games and game consoles, fell 4 percent to $21.3 billion (euro16.8 billion) in 2005, from $22.1 billion (euro17.4 billion) in 2004, according to NPD.
But online sales of traditional toys surged 32 percent in 2005 compared to the year-ago period, according to comScore Networks, an Internet research company. NPD estimates that online toy sales account for about 6 percent of total toy sales. is angling to take a big share in cyberspace by offering for the first time gift cards and expanding its merchandise to include children's books and DVDs, services that were prohibited under the previous partnership. It also is offering more toy exclusives this year, something that does not have. Exclusives include micro preschool scooter from Huffy and a nativity scene and Hanukkah set, both from Fisher-Price's Little People brand. also relaunched its site with an improved search engine and bigger and brighter pictures of the toys, using technology specifically for that category, according to CEO and Chairman Jerry Storch. The former vice chairman of Target Stores Inc. joined Toys R Us in February, following the company's move to go private last year. Customers can also personalize the site by age and brand, he said.
"It's very exciting to be independent," Storch said. "What's important is that we compete on authority... We are not or toothpaste. It is all about the toys."
Toys R Us declined to comment on how many toys it will feature online for the holiday season but said it will have more than what it had on currently features about 120,000 different traditional toys, about five times the number of toys it offered right before its partnership ended, according to Jennifer Arthur, senior manager for toys and babies products. It has also doubled the number of third-party sites to 80 and expanded its toy business with its merchant partners like discounter Target.
"We're focusing on what we do well as well as we can," said Arthur.
Dougherty believes that both companies have its advantages and disadvantages. She noted that while is the authority on toys, it needs to better take advantage of its presence both online and in stores. A big advantage, she said, is if shoppers can order online and then pick it up in the stores. is testing that service in certain markets this holiday season; it will be rolled out nationwide next year.
Storch noted the retailer will also be expanding its baby registry online while further blending the online and offline experience.
Dougherty said that's edge is its ability to drive customer traffic to its site with its wide breadth of products. In fact, Arthur said it will be sending out targeted e-mail campaigns to shoppers based on what they have bought in the past.
"We have a great wealth of information," Arthur said.
But Chris Byrne, an independent toy consultant, noted, that's weakness is that it is not an authority on toys and doesn't have the relationship with makers to keep hot toys in stock closer to Dec. 25.
In fact, availability could be an even bigger problem with every toy seller this holiday season. Stores are reporting better-than-expected demand on some holiday toys particularly T.M.X. Elmo from Mattel Inc.'s Fisher-Price, which could be this year's must have toy, after several years without one. Dougherty said that if T.M.X. does become the must-have product, it will only increase the competitive stakes. said it sold out of its allotment of T.M.X. Elmo but is working with Fisher-Price to get more. Meanwhile, Toys R Us spokeswoman Kathleen Waugh said new shipments are coming in, though they sell out quickly.

Updated : 2021-06-17 17:55 GMT+08:00