JCPenney, Walmart Hope To Win On Babies 'R' Us Bust

Call it babypalooza: JCPenney is betting big on little ones, announcing the opening of new Baby Shops in 500 of its stores. That follows Walmart’s news that it, too, is stepping up its baby game with a shop-by-style nursery destination.

Both are hoping to make bank on the hole left in the retail landscape by the recent demise of Babies ‘R’ Us.

Rival Target has made babies (and their millennial parents) a major focus for some time, including the successful launch of private-label brand Cloud Island last year, featuring clothing and décor.

Despite the rise in spending on baby gear, a business that Penney predicts will hit $13 billion in the U.S. by 2021, marketers and retailers are facing a harsh reality: Birth rates in the U.S. have dropped to a 30-year low, according to the latest report from the Centers for Disease Control and Prevention, with just 3.9 million new births in 2017, a 2% dip from the prior year and the lowest number since 1987.



The JCPenney Baby Shops, which the retailer says are an attempt to capture new market share, pull together baby items in one place, so shoppers no longer have to roam the store for cribs, strollers and baby clothes.

The company says it has strategically chosen the first 500 locations because of their proximity to former Babies 'R' Us stores. In addition to many name brands, the shops are also stocked with plenty of clothing by Okie Dokie, Penney’s private-label baby brand.

Meanwhile, Walmart’s new online offering includes an expansion of its assortment, as well as a shop-by-style feature, with options like classic pink, mid-century modern and boho chic. It’s also offering a gender-neutral option, a style area that’s been a major emphasis at Target.

Toys ‘R’ Us filed for bankruptcy last September and hoped to survive through reorganization. It surrendered to liquidation in March and closed its final stores, including nearly 900 Toys ‘R’ Us and Babies ‘R’ Us shops in the U.S., earlier this summer.

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