Gavetti and Rivkin believe that “the heart of a company’s strategy what it chooses to do and not to do. The quality of the thinking that goes into such choices is a key driver of the quality and success of a company’s strategy”. (Gavetti & Rivkin, 2005).
If we discuss Toys R Us in relation to its competitors we can spot Wal-Mart as the market leader with forty percent and above of market share in toy industry. Target Corporation can be identified as a market challenger that closely mimics Wal-Mart’s pricing strategy to attract customers and adds to it the perceived benefit of trendiness that Target projects about itself. Toys R Us appears to be the market follower that is trying to cling on to its current market share and content in withholding customer attrition. GameStop can be spotted as a market nicher that serves a sub-segment of the industry i.e. gaming. Furthermore, Toys R Us also appears to be following the imitator role of a market follower, wherein, it follows the lead of Wal-Mart such as lower pricing but maintains its differentiation of packaging, promotions, products and distribution channels. Toys R Us is lacking a core competency, one that truly differentiates it among its peers. Provided that under the recessionary trends, or other skill deficiencies faced by the organization it should focus on pricing strategy for survival. If it does not do so the discount retailers would kick it out of the market.
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