Down, But Not Out, Toysrus.com Weathers Another Storm

Problems continue to plague Toysrus.com, with heavy traffic shutting out shoppers for several hours on Tuesday. The latest troubles come on the heels of those occurring earlier this month, when promotions for $10 off, free shipping and a free Tickle Me Elmo doll caused a similar traffic jam.
A company spokeswoman insists the site was never down and only barred new shoppers from entering in order to prevent an outage. The problems began when circulars mailed with the the company's Big Book of Toys caused Web site order volume to triple. CEO John Barbour says the company will triple its number of Web servers to prevent future problems.
Liz Leonard, analyst at Gomez Advisors in Lincoln, Mass, says the retailer's problems call its holiday preparations into question. At the same time, she adds, "the story isn't over yet." Leonard cites the company's buying power and years of experience as important strengths. "Although this is a sign the infrastructure and technology aren't yet in place, Toys R Us could still blow competitors out of the water."
Further tests of the retailer's infrastructure could be coming: Toys R Us today announced plans to extend its online discounts through Dec. 1 in order to accommodate the increased demand.