March 24, 2011, 4:51 PM

The web accounts for 60% of annual growth for Toys ‘R’ Us

2010 e-commerce revenue increased 30%. 

Mark Brohan

Research Director

Lead Photo

An investment in e-commerce paid dividends for Toys ‘R’ Us Inc. in 2010.

For the year ended Jan. 29, Toys ‘R’ Us, No. 37 in the Internet Retailer Top 500 Guide, reported:

  • Web sales increased year over year 29.9% to $782 million from $602 million.
  • Total sales grew 2.2% to $13.86 billion from $13.56 billion in 2009.
  • Comparable-store sales increased 1.7%.
  • Net earnings decreased 46.2% to $168 million from $312 million.

Internet Retailer calculates the web accounted for 5.6% of total sales, compared with 4.4% in 2009. Internet Retailer also projects that the web accounted for 60% of growth across all channels last year.

“Throughout the year, we made important investments in our future, including the expansion of our e-commerce presence in international markets, increased levels of service in our stores and the opening of a sourcing office in Shenzhen, China, which will further enable us to differentiate our product assortment,” says CEO Jerry Storch. “E-commerce sales growth was particularly strong as we continue to benefit from our enhanced capabilities in that area.”

Last year Toys ‘R’ Us rolled out a number of new e-commerce initiatives such as over the holidays enabling shoppers to buy any of more than 7,500 items online and pick them up in 260 Babies ‘R’ Us and select Toys ‘R’ Us bricks-and-mortar stores in such major U.S. metropolitan areas as Boston, Chicago, Seattle and Washington, DC. Other e-commerce enhancements launched last year include:

  • Allowing customers to determine online if an item is in-stock at a particular store.
  • New European web sites in Austria, France and Germany.
  • Expanding its online loyalty club program

“We plan to further expand and leverage our e-commerce business by continuing to integrate our Internet capabilities with our stores,” Toys ‘R’ Us says in its recently filed annual report with the U.S. Securities and Exchange Commission.”

Toys ‘R’ Us doesn’t break out quarterly web sales, but for the fourth quarter recorded:

  • Total sales increased 2.1% to $5.97 billion from $5.85 billion.
  • Comparable-store sales grew 1.8%.
  • Net earnings decreased 14.7% to $330 million from $387 million in Q4 2009.

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