Global Toy Market Enjoys Healthy Growth In 2015?

Global Toy Market Enjoys Healthy Growth In 2015?

This week it was reported that the Global toy market grew by 7% in 2015 (Jan-Sept) versus the previous year for that time period. For the full data/press release from NPD just click here. Now we must note that the data covers the first 9 months of the year outside of peak trading only, so the key retail sell through period is not captured in this, so if for instance we had a particularly bad last quarter, the full years results could be significantly worse than this – however, we don’t see that happening at all. In fact there is a fair chance of the final full year figures showing even more growth, perhaps even sneaking to double digit growth.

The reason being that global toy market size for any given year is hugely driven by the movie slate for that year, and for the general momentum behind movie franchises. As I’ve written elsewhere, we are entering a golden period for toys where there is so much guaranteed movie activity on so many proven hit movie franchises which are guaranteed to shift toys off shelves in huge quantities, and with an ongoing year on year movie slate which toy executives from previous eras would kill for!

In previous articles written this year I highlighted how the toy industry was set for significant growth this year, and this latest release of data seems to support that opinion. I can’t however claim to be particularly prescient or brilliant in this prediction, if you sat down 100 toy industry people and showed them the movie slate for a given year, 99/100 of them would be able to accurately predict higher/lower years for the industry based purely on what movies are coming out.

Furthermore, when we look forward into 2016, we have not just a very strong movie slate (I’m not repeating the list, just click here for the year in film 2016: https://en.wikipedia.org/wiki/2016_in_film) but also an almost unprecedented forward momentum from numerous franchises. Above all Star Wars – that behemoth of toyetic movie franchises – launches very late for a toyetic movie (mid December), meaning that a large proportion of the expected monstrous toy sales resulting will definitely go into the traditionally quiet Q1 2016. By delivering a significantly higher Q1 than would usually occur, The Force Awakens will kickstart a year that may well surpass 2015 in terms of toy sales, and with a Star Wars spin off film among the myriad of 2016 blockbusters due to hit global cinema screens, the outlook is better for the toy industry looking forward than perhaps it has been for a long time.

The challenge of course is to remember the bottom line, because while consumers will buy licensed toys in gargantuan quantities, and retailers will lap up anything that moves off shelf quickly, toy companies neeed to work ten 10 times harder to push their own brands to protect both profitability and their own asset value…be interesting to see how many companies manage to protect their long term success/value at the same time as milking these licensed heroes to ensure that this growth is healthy for the long term!

 

by Steve Reece, CEO of Kids Brand Insight www.KidsBrandInsight.com,  a leading Consultancy to toy, game and kids entertainment companies around the world, which helps companies find the right toy & game factories, consumer research test their products with kids and parents and secure export distribution/market entry around the world