Disney in August bought a 61% stake in the educational toy site for $25 million in cash and $20 million in promotional services. Two months later, Toysmart began its holiday ad campaign via Arnold Communications, Boston. Toysmart spent $11.8 million on ads last year, according to Competitive Media Reporting.
Toysmart, however, has become a casualty of the consumer e-tail shakeout.
Toysmart tried to reposition itself as a business-to-business venture, but CEO David Lord said the Disney-backed board decided to cease operations when negotiations with investors for that restaging collapsed at the last minute.
Toysmart joins other recent e-tail casualties failures, including fashion retailer Boo.com and computer retailer CompUSA's Cozone.com.