TOY STORIES

PPS is joined by four leading executives from the preschool toy space – Liz Ireland, founder and md, Bigjigs Toys; Phil Cassidy, md, Casdon; Neil Montgomery, UK commercial director, Jura Toys; and Nic Aldridge, md, Bandai UK – to discuss whether the category is recession proof, the importance of innovation and extended play value, plus if the UK toy market can see growth in 2023.

FIRSTLY, IS THE TOY BUSINESS RECESSION PROOF IN YOUR OPINION? WHAT MAKES IT THIS WAY?

Liz: “Yes, to a large degree – people will still buy gifts though I believe the amount spent reduces. Where a gift budget has been set at £20, when household budgets are squeezed this may reduce to £15 making price points really key.”

Phil: “Yes and no. We can see that the industry has absolutely been impacted by the effects of Covid and a recession is no different. Consumer confidence is at an all-time low and this has an impact on purchase decisions - the toy industry is no exception to this.

Of course, we still celebrate big events such as birthdays and Christmas every year, however we’ve certainly seen consumers become savvier with their approach and while they may not necessarily be eliminating gifts completely, they’re certainly being more considered when making purchase decisions.”

Neil: “In my opinion the toy business is recession proof because people will always find money to spend on their children, that seems to be nonnegotiable. Therefore, companies can still deliver stable sales despite tougher economic conditions. However, I do see that a recession can change the shopping habits of consumers who become more discerning in looking for better value for money and products with greater longevity.”

Nic: “No not completely but very close to it. People (parents/gift givers) might rationalise their spend but they will always find a way to fund some toy sales even if it means cutting back on other luxuries. Often parents will use toys to buffer what bad news there might be in the rest of the world. However, we are also seeing the growth of second hand toy sales in the market as a solution to challenged household budgets, but also I believe as a move to more sustainability in the marketplace.”

HOW IS THE CURRENT CONSUMER APPETITE FOR TOYS? ARE YOU SEEING LOWER PRICED ITEMS PROVING MORE POPULAR OVER BIG TICKET ITEMS?

Liz: “Consumer appetite is buoyant with a desire to buy a product with value. Big ticket items are for the last quarter. Those items in our range with a retail value of less than £25 are selling well.”

Phil: “Our Casdon product range sits in a real ‘sweet-spot’ in terms of RRP. Typically, our products retail between £8 and £40 which is also the area in which the industry has reported the most growth in.

It’s difficult to say whether consumers are being driven to purchase lower price point items given we have a relatively narrow price range. However, I think there are many other factors that come into play when customers are researching what to buy – value for money is possibly a bigger contributor as they recognise that purchasing products which can stand the test of time is money well spent.”

Neil: “There is always a good appetite for toys albeit we all understand that the appetite increases as we move towards the end of the year. There is no doubt that the lower priced items are more popular currently, but that is always the case as alongside the appetite increasing as we move through the year so does the demand for higher priced items. The most popular price points we are seeing now are between £10 and £20.”

Nic: “We as a company are directionally moving towards more pocket money based toys in the market place and we’re finding strong traction with retailers as we believe that when budgets are challenged parents and gift givers will still like to buy toys for children. Pocket money toys definitely help with this impulse purchases. Big ticket items will still be purchased, but these occasions will definitely be much more considered and reduced so instead of potentially getting more than one big ticket item this would be reduced to just one per birthday and Christmas. We’re still planning some big ticket items but we’re definitely being more selective in our launches.”

WHAT SECTORS/CATEGORIES ARE TRENDING FOR YOUR BUSINESS?

Liz: “Rail and role-play do very well for us throughout the year, but as spring approaches garden, outdoor and beach will do very well for us. Green Toys - a 100% recycled plastic range - does well throughout the year as it’s a great product both indoors and out.”

Phil: “Our entire range is purely focused on preschool role-play, with our licensed items often most popular. Dyson has always been a firm favourite within the collection and our latest hair styling tools have been no exception. Joseph Joseph has also proven popular among adults and children as we see baking is still a popular past-time for children to join parents and carers in the kitchen.”

Neil: “We are currently enjoying a big increase in demand for outdoor toys and art and craft lines. I think people are looking forward to some better weather and a chance to spend time outside with the children; that is why our Muddy Lab outdoor kitchen seems to have been so well received. At the same time the current reality of poor weather means parents need to find ways to entertain their kids indoors and art and craft is the perfect tool for this.”

IN THE CURRENT CLIMATE, HOW IMPORTANT IS IT TO INNOVATE?

Liz: “We are always trying to innovate through familiar and less familiar materials. Making a commitment to move our range to completely FSC production by 2025 is providing a few challenges, but these will be overcome. Retailers demand newness and we aim to provide on an annual basis.”

Neil: “As a business we invest heavily in developing new products every year, typically launching over 200 new products a year across our brands. New products are always great to generate interest with both retailers and consumers alike. We all seem to be constantly looking for the next big thing and innovation is a big part of this, but also offering striking, high quality toys that stand out, which we have done with the new Dino collection.”

Nic: “We’re finding that during the Covid period that there was much less innovation in the market and also retailers and consumers were sticking with tried and tested properties. New properties are struggling to break through in the market where they are launched. But now we’re emerging from the throws of the Covid period we’re starting to see some great innovation. This is the lifeblood of the toy industry so we’ll still keep pushing new properties and new IPs and innovation.”

IS THERE STILL ROOM FOR NEW PRODUCT/ IP/BRANDS TO BREAKTHROUGH?

Phil: “There’s always room for new product… children (and adults) love variety in play. We have a fantastic R&D department here at Casdon who are regularly reviewing market trends and exploring opportunities for ‘the next big toy’.”

Nic: “Absolutely there is and it’s just what we need. To break through it needs to be in a tried and tested play pattern and something that is recognisable to the retailer and consumer, but with a completely new twist/innovation. Anything too ‘out-there’ and you struggle to get retailer acceptance with listings and less consumer spend for parents to test wholly new concepts.”

HOW IMPORTANT IS EXTENDED PLAY VALUE IN A TOY/RANGE?

Liz: “I would say very much so and the companies that can provide the greatest value in a product will do well. Customers want to see great value at the point of purchase and in enduring play with the product.”

Phil: “Possibly more important than ever. Extended play items not only ensure that our toys are kept firm favourites within the toy-box, but they open more opportunities for role-play as well as involving siblings and friends through play, which we know has great social and communication developmental benefits.”

Nic: “Becoming more and more important, as traditional media is often not enough to launch a new IP anymore.”

CAN THE UK TOY MARKET SEE GROWTH THIS YEAR?

Liz: “I’m hoping so. I think the market as a whole may well remain flat this year – we need to work that little bit harder to get a slightly bigger share of it.”

Neil: “Absolutely. I am under no illusion that we are all facing a challenging year, but early sales results alongside a positive reaction to the new products and good listings gives me confidence that we can grow the business again and I have had many similar conversations with other toy suppliers.”

Nic: “I think that the industry will be flat this year or possibly a slight decline, but we’re approaching it with cautious optimism.”