But that's the whole point, if both are the same on that aspect, and amazon has a larger catalog size, and I already have evening/next day delivery from amazon anyway, why would I bother going the to the toy store ?

The whole point he was making is, once amazon existed, they failed to compete with it. You're a physical store, you have the possibility to interact with people, offer them things they can't have over the internet, use it. If you don't, you're wasting a lot of money on prime rent.