The impact of Covid-19 on toy sales worldwide
At Global Toy Connect, a virtual event organised by NPD Group and held online in February 2021, experts in the sector took stock of the current situation, identifying the current trends in the toy market. Starting at sales in retail, which in 2020 in the United States were 16% higher compared to 2019. Despite the restrictions due to the pandemic, the American market resisted, so much so that the month of May was the one with the most sales (+ 38%). Beyond sales in brick-and-mortar stores, online purchases also increased. “2020 was an unprecedented year for the toy industry in the United States. The growth we have seen shows that parents are willing to put their children's happiness above all else", said Juli Lennett, Vice President and Industry Consultant at US Toys, a part of The NPD Group. She continued: “Families have understood that toys help to keep their children busy, active and happy.” In Europe, however, the situation has taken a turn for the worse. In France, the entire retail market decreased by 1.5% compared to 2019, while in Italy it fell by 6.9%.
In addition to sales, NPD Group representatives also addressed new marketing and product trends, explaining that in order to succeed in such a varied market, innovative sales techniques that take the needs of children into account are necessary.
The effectiveness of geomarketing
The differences in sales between the various countries were determined by several factors, such as the purchasing power of families, restrictive measures, and the presence of children at home. For a company that wants to export their products abroad, geomarketing is an essential tool in promoting their brand and gaining new customers. Geomarketing refers to sales techniques based on geographical information, so as to better plan commercial activities: from the analysis of the competition to the development of distribution channels.
However, neither are all economies the same and, as the NPD data shows, nor are all families. One example is the effectiveness of discounts: Rodrigo Vivanco, Analytic Solutions Europe & APAC, explained that discounts have had different effects in different countries. In the United Kingdom, the toy market recorded a surge of 5% in total revenue, while Italy saw a decrease of 7%. This proves that geomarketing is a very valid tool not only for pricing, but also in developing advertising campaigns.
The importance of exposure
If it is true that new technological devices such as displays or touch-screen monitors have a strong visual impact on customers, shop displays (showcases and shelves) remain vital in enhancing the visual appeal products have in stores. Looking at the latest polls, Aurelia Florent, Head of Analytics Solutions France, and Francois Dealu, Head of Analytics Solutions Europe, said that for toy manufacturers and retailers, exposure represents a real investment opportunity and, as such, requires careful evaluation. The criteria that come into play are related to the impact on sales, inventories, and the projected increase of customers. Store managers often turn to agencies specialised in commercial outfitting that can customize their space according to certain needs: inaugurations, Christmas holidays, local restyling. In their speech, Florent and Dealu noted that single-brand stores are the most effective when it comes to exposure, precisely because it is such a vital part in the promotion of a new product.
Harry Potter and Barbie: two evergreen brands
Even though we may find ourselves in very complicated times, substantial brands are resisting the crisis. Not even Covid-19 is able to stop the force of Barbie, which even won several NPD awards this year: Global Top Toy Property of the Year, Global Top Toy Property of the Year Europe, Top Gaining Mexico, Top Selling US, Brazil Top Toy Property of the Year. All these results obtained in different parts of the world show that a serious geomarketing strategy and the emphasis on presentation at the point of sale influence the results.
The case of Harry Potter, the famous wizard with glasses born from the pen of English writer JK Rowling, is interesting as well. Despite the last film in the series being released in 2011, Harry Potter toys continue to sell. The reasons are to be found both in the appeal of the brand and in the new video platforms. Harry Potter has not only found his way into the hearts of kids today but continues to be cherished by adults who were kids themselves when the films were released in the early 2000s ¬and did not miss a single one for anything. Today, they are the ones who collect objects or mini figurines of the various characters. Gabriella Lo Bue, Specialist Client Development, USA, explained that the launch of the films and videos on Netflix has encouraged the sales of the wizard's toys, a sign that video content can affect sales even if decades have passed.