Here’s Why Kohl’s Is Bringing A Defunct Baby Brand Back From The Dead

For many of you, Toys R Us represents yet another cherished childhood memory that has fallen victim to the rapidly changing retail landscape of the past couple of decades.

And an associated chain, Babies R Us, met the same fate more recently … but thanks to the intervention of another retailer, it’s getting a new lease on life.

A store within a store

Kohl’s has managed to maintain a solid brick-and-mortar footprint despite the rapid rise of online retailers. But that has required frequent adaptations to its business strategy.

Most recently, the company confirmed it would be adding an in-store Babies R Us shop to many of its locations, aiming for a total of 200 by the end of next month.

These oversized kiosks will feature many of the products that parents of the past came to expect from full-fledged Babies R Us stores, like car seats, strollers, and bath supplies. This means Kohl’s will have a lot more to offer parents than its existing selection of baby clothes.

And given the chain’s presence in high-traffic, largely upscale suburbs across the U.S., appealing to parents could be a way to boost its bottom line considerably.

A not-so-perfect plan

Kohl’s CEO Tom Kingsbury thinks the strategy could mean an infusion of $2 billion more in sales over the next several years. But there’s a glaring issue on the horizon.

Fewer Americans are having babies than at any point in the past four decades, which could seriously diminish the return on this investment.

Nevertheless, Kingsbury is betting that those who do decide to become parents will gravitate toward the premium products offered by Babies R Us … and with a 14% decline in net sales over the past five years, Kohl’s needs all the help it can get.

Chris Agee August 2nd, 2024

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