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Albertsons and Toys R Us have signed a deal to conduct a five-unit test of a store-within-a-store concept that will place branded Toys R Us departments inside Albertsons’ Jewel-Osco supermarkets.

The department, called “Toy Box,” is designed to stock a wide range of the most popular toys, according to a company statement.

The test stores are located at 4660 W. Irving Park, Chicago; 6505 W. Diversey, Chicago; 944 York Road, Elmhurst; 1177 S. Main, Lombard; and 177 E. Roosevelt Road, West Chicago.

The concept is similar to one tested by Ahold’s Giant Foods last year.
KC's View:
Dunkin’ Donuts in Hope Depot. Office Depot in Stop & Shop. McDonald’s in selected Wal-Marts. Toys R Us departments inside various supermarkets.

Does anyone else see the pattern here?

On the face of it, this seems to make a lot of sense, especially because these kinds of deals can provide great points of differentiation for retailers. Our only question is whether or not these deals end up promoting the right brand – does Toys R Us get more long-term benefit than, say, Albertsons?

It’ll really get interesting when Toys R Us decides to test Albertsons-branded food departments inside the walls of its traditional toy stores.