MyToys, a significant German marketplace and part of the OTTO Group, has just announced it will stop operating from Feb next year. This news comes courtesy of Jesse Wragg, Managing Director of eCommeleon, who helps online retailers expand into international marketplaces.
MyToys will close due to it’s financial situation, with the company saying that the required turnaround that has been initiated is not just associated with high investments, but also involves risk in relation to the increasing pressure on margins, costs and the market. OTTO Group simply can’t see a path to profitability in an economy where margins are squeezed and costs spiralling.
The only reason that MyToys is still operating today is due to a boost in trading during the Coronavirus pandemic. However the impact of the pandemic on consumer spending has vaporised and with the reality of losses it’s time to finally pull the plug.
The intention is that both the myToys and myToys Collection brands will continue to be used by OTTO after the closure of mytoys.de. Once the site is shut down, consumers will be signposted to the otto.de marketplace.
The MyToys marketplace will continue to operate until perhaps February 2024 at the latest, when the MyToys business ceases to operate. Employees are being considered for positions in the wider OTTO Group.
OTTO Group believe that the low-margin toys category will be easier to operate within the OTTO Marketplace than as a standalone loss making business so if you sell on MyToys this is where your focus should be. OTTO Group say that they believe in the myToys brand and want to position it within the OTTO marketplace but after years of loss making can no long continue with the current standalone site.
