Toys ‘R’ Us faces challenges with new tablet 'Tabeo'

A new entrant in the tablet computer wars brings nothing to the fight if not youthful vigor: Toys'R' Us today is expected to announce the Tabeo, a new tablet for kids. It will come pre-loaded with 50 apps, it's wi-fi enabled, and you can only get it at Toys'R'Us.

While the Tabeo is designed just for kids, getting into the tablet hardware business could prove to be a grown-up challenge, according to James McQuivey, an analyst with Forrester Research.

The introduction of Tabeo places the toy retailer in a similar category as other brick-and-mortar retailers like Barnes & Noble, who are struggling to compete against established tablet makers like Amazon and Apple.

Toys 'R' Us's tablet will only be available in stores and on its website. That, McQuivey said, could help the toy retailer battle a growing trend facing brick-and-mortar retailers where customers shop in person and then make their purchase somewhere else online.

"What they want to do is lock the customer into their platform," McQuivey said. "It's a store in your pocket."

But as a toy retailer, Toys ‘R’ Us faces a steeper challenge branding itself in the tablet market compared to other retailers.

"This is a much more challenging thing than selling a few books on a Nook tablet," McQuivey said. "You don't really think of one particular brand as being the source of toys the way you think of, say, a Barnes & Noble being your source for books."

Listen to the full audio interview for more on the announcement.

About the author

Jeff Horwich is the interim host of Marketplace Morning Report and a sometime-Marketplace reporter.

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