While Toys R Us was founded in , the heyday of category killers was during the s and s. That was when category killers proliferated across the country. Within the next decade, however, the fortunes of these category killers unraveled. Some declared bankruptcies, others shut down, and others began reporting steep losses. Several factors were responsible for their gloomy condition.
One of them was the continued dominance of Walmart as a vast national discount retailer. The Arkansas-based behemoth not only ate into the market share of independent stores but also that of retailers like Toys R Us. Another notable challenge was the rise of e-commerce companies like Amazon.
These companies offered low prices, and the convenience of one-stop shopping from the comfort of the consumer's home, destroying the high-expense economics of many big-box retailers. Some big-box category killers may yet be able to defend their category economics, if they can create a compelling shopping experience. To do that, they will need to combine instant gratification, personalized selling, unique assortments, and a sensory showroom experience that borders on entertainment.
They may also need to downsize their stores to maintain maximum flexibility, as well as combining clicks with their bricks, as Walmart is now doing. A new type of category killer has also emerged online. Such sites typically specialize in offering a specific product category at different price points.
For example, Warby Parker specializes in retailing prescription glasses and sunglasses. Casper, another online startup , specializes in selling different kinds of mattresses, while Harry's and Dollar Shave Club offer shaving products. These companies are built on a different business model compared to the earlier category killers, which mainly competed on price.
The new breed of online businesses not only compete on price but also on convenience of purchase and after-sales support. The Washington Post. The New York Times. Personal Finance. Company Profiles. Family Finances. Dividend Stocks. Tech Stocks. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. Ronald D. Michman, Alan James Greco, Category Killers Over the last 20 years, a new breed of specialty retailer, the category killer , has evolved.
A category killer is a very large specialty store that concentrates on a major product category and competes on the basis of low prices William Pride, Ferrell, A category killer store offers an exhaustive selection in a single product line. Toys "R" Us features relatively low prices, and Michman, Edward M. Mazze, Department stores of the s consciously assign their leaseholds to category killer merchants when assignment suits them.
Moreover, some department store chains have divisions in the category killer business themselves and have seen Emanuel B. And retail centers often bring in " category killer " box stores that cost retail jobs elsewhere in the local economy. There's also a fairness issue.
IndieVice Inc. Changes the Game in the Video and Camera Industry …. Perich family increases Freedom Foods stake in shadow of a2 …. UBS analyst Jordan Rogers said a2 was a " category killer brand with growth options in new geographies and categories", considering it has The Home Depot.
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List of Partners vendors. Retail Small Business Glossary. By Matthew Hudson. He is the author of three books on retail sales and has nearly three decades of experience. Learn about our editorial policies. Updated on July 30, Key Takeaways Category killers are major companies or products that effectively "kill" the competition.
Category killers are usually large companies that can wield their size to achieve efficiencies, prices, and selections that smaller businesses can't compete against.
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