Toy consumers adapt to the increasing cost of living
London, 15th November 2022: According to The NPD Group, which recently merged with Information Resources, Inc. (IRI®) to create a leading global technology, analytics and data provider, many consumers have already started to change their toy buying habits as they react to the cost-of-living squeeze. Feeling the greatest impact are toys at the lowest and highest ends of the price scale as shoppers cut back ahead of the toy market’s most important sales season of the year.
Shoppers’ budgeting has hit sales of less expensive toys the most. In the past, two-thirds of the toys sold (70%) in the first three quarters of any year have been priced under £10; but this year, this price point has experienced some of the largest declines vs. the same period in 2021 (January to September), falling -15%, a value loss of £62.3 million.
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Historically, toys costing £10 or less account for one-quarter of all toys bought in the last three months of the year. If the budgeting trend in this segment of the market continues into November and December, these lower-priced toys, often used as stocking fillers, could be at risk this Christmas. However, with the FIFA World Cup in Qatar starting next week, the industry may see this trend disrupted with lower-priced items boosted by the Panini World Cup stickers in the next two months.
Sales of big-ticket toys priced £50+ decline -8%
At the other end of the spectrum, toys sold for £50 and over declined -8%, a loss of £13 million. With Christmas approaching, the NPD Group usually reports an increase in the big-ticket items for the final months of the year, and so far in 2022, this trend has yet to emerge. With Christmas Eve falling on a Saturday, consumers may wait to shop for toys at the very last minute. We last saw this trend in 2016 when the final week prior to Christmas saw massive sales increases and was the largest shopping week of the year for the sector.
Mid-priced toys are the only segment of the market to see sales growth
With rising inflation impacting all homes in Britain, we might have expected sales of the cheapest toys to rise. However, consumers aren’t necessarily trading down to the lowest-priced toys and have cut non-essential toy purchases while the toys in the mid-priced tiers are seeing an uplift. Sales of toys priced from £10 to £19.99 are up +1% and those with price tags from £20 to £49.99 are up +7% as some consumers may be purchasing multiple mid-priced toys rather than one big one. Categories that have performed well are the ones that appeal to all ages and genders: Traditional Plush, Action Figures, Preschool Figures & Playsets, and Action Figure Collectibles.
The NPD Group: Top 10 Items £10 – £19.99 (YTD September 2022)
| Item Description | Corporate Manufacturer |
|---|---|
| Paw Patrol Vehicle and Pup | Spin Master |
| Polly Pocket Sweet Treat Compact Assortment | Mattel |
| Squishmallows Plush 12″ Assortment | Jazwares |
| Barbie Color Reveal Doll Assortment | Mattes |
| L.O.L. Surprise! All Star B.B.s Sport Assortment | GA Entertainment |
| LEGO Technic Monster Jam Megalodon | The LEGO Group |
| LEGO Minecraft The Fox Lodge | The LEGO Group |
| LEGO Minecraft The Mushroom House | The LEGO Group |
| LEGO Speed Champions Koenisegg Jesko | The LEGO Group |
| LEGO Technic Monster Jam Grave Digger | The LEGO Group |
The NPD Group: Top 10 Items £20 – £49.99 (YTD September 2022)
| Item Description | Corporate Manufacturer |
|---|---|
| LEGO Botanical Collection Flower Bouquet | The LEGO Group |
| L.O.L. Surprise! O.M.G Doll Assortment | MGA Entertainment |
| Swingball All Surface Assortment | Mookie Toys |
| Squishmallows Plush 16″ Assortment | Jazwares |
| tech Baby First Steps Walker | Vtech |
| LEGO Botanical Collection Bonsai Tree | The LEGO Group |
| Barbie Cutie Reveal Assortment | Mattel |
| Rainbow High Doll Assortment | GA Entertainment |
| Kidizoom Duo DX | Vtech |
| LEGO Star Wars 510st Legion Clone Troopers | The LEGO Group |
Melissa Symonds, Executive Director, UK Toys says “With money tight for so many, consumers have been cutting back on buying toys at the lowest and highest ends of the price scale. Now we are in the run-up to Christmas, we would expect sales to increase and it will be fascinating to see at what price point. In recent years, supply has been a major issue with many parents struggling to find the toys on their child’s wish list. Today, the challenge is one of affordability and canny consumers will be looking for discounts and promotions like Black Friday to help make their Christmas budgets go further. With Christmas Eve falling on a Saturday, we predict that sales will be made right up to the 24th December as shoppers wait in hope of grabbing a last-minute bargain.”
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Teresa Horscroft
Eureka Communications
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Frédérique Tutt
Global Industry Advisor
Email: frederique.tutt@circana.com
Phone: +33 630446824
