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The Wall Street Journal reports that the suddenly popular practice among some retailers to create mini-sections within their stores for other retailers continues to gain momentum, as Sears, Roebuck & Co. announced that during the coming holiday season, 600 of its stores would house temporary KB Toys shops.

This announcement follows similar initiatives announced by Saks (which will have FAO toy shops in many of its stores), Marshall Field's (Creative Kidstuff departments), and Albertsons (Toys R Us).

The strategy is designed to help these retailers compete more successfully against Wal-Mart by providing families with more reasons to come to the store. Especially during the holidays, these retailers seem to believe that climbing into bed with category killers of various stripes can help them build sales and customer count.
KC's View:
We see two problems with this strategy.

First, it helps to build brands other than the hosting retailers…and we're not sure, in the long run, if this is helpful. (Though there are plenty of people in the MNB community who seem to believe that traffic is traffic, and retailers have to get what they can while they can.)

Second, toys can be a pretty dicey inducement for consumers. If the guess is wrong, the retailer can get stuck with a lot of merchandise that just doesn’t turn the consumer on.