NPD Insight
Woah, we're half way there…
This month, Melissa takes an in depth look at UK toy market sales Price Point Across Total Toys well at the half-way point ofChanges 2022, looking at what’ s performing Price YTD £9.15 (+8%) and howAverage price points are evolving.
T
Unit % Sales
Unit Yr/Yr % Change
Avg Monthly Items Per Store
Change increase in 2022, up +8% YTD June, roughly aligned he UK toy market reached the half-way mark with the Consumer Price Index which was up +8% in of 2022 with value sales down -8% (-£63m) < £5 -5.7% -4 46% May. The average selling price for toys is now £9.15, up compared with the first six months of 2021. from £8.50. However, the average selling price includes a Volume sales were down even further at £5 - £9.99 0.1% -6 26% mixture of base price changes, promotional fluctuations -15%. Part of this decline was driven by the and consumers 4.1% product mix changes, so it doesn’t stronger than normal sales20% in Q1 2021, when the UK was £10 - £19.99 15 always tell the whole story. in a third national lockdown. It is worth noting that YTD Jun 2022 is up by +3% in value compared the same Looking at the key price points, toys sold under £5 £20with - £49.99 7% 1.4% 6 period in 2019, the last ‘pre-Covid’ period, representing accounted for 46% of the volume sold in Q2 2022, yet an additional £20m sales. As the UK market reacted accounted0.1% for just 12% of value sales. While this 1% toy£50+ 1 still Source: The NPD Group | Retail Tracking Service | UK | 3M Jun-22
Price Point Changes Across Total Toys Document classification: Client/Third Party Confidential
1
The NPD Group, L.P. | Proprietary and confidential
Average Price YTD £9.15 (+8%) Unit % Sales < £5
46%
Unit Yr/Yr % Change -5.7%
£5 - £9.99
26%
-4 0.1%
£10 - £19.99
20% 7% 1%
Avg Monthly Items Per Store Change
£20 - £49.99 £50+
-6 4.1%
15
1.4%
6
0.1%
1 Source: The NPD Group | Retail Tracking Service | UK | 3M Jun-22
positively to the lockdowns and enjoyed strong growth Document classification: Client/Third Party Confidential The NPD Group, L.P. | Proprietary and confidential for these periods, it is always difficult to match those sales out of lockdown. However, Q2 2022 sales declined -6% vs. 21, without a lockdown in either period, although these sales are also up +3% vs same period in 2019. So, what are the current challenges facing the UK toy market? The UK is facing a cost-of-living crisis with energy bills soaring, food prices increases and petrol at record highs. While the toy market is often said to be recession proof, it is still being impacted by the challenges facing consumers’ discretionary spend. In addition, the toy community is dealing with its own pricing challenges, from production to supply chain over the last year. The UK toy market has seen the average selling price
represents nearly half the number of toys sold, there 1 were actually fewer toys sold at this price point. In total, there was a decline of 6.4m units – either through consumers cutting out non-essential toy purchases, reducing the frequency of impulse purchases or some items moving up a price point. £5 - £9.99 also experienced a volume loss of 1.9m units. Looking at the average number of items sold per store at these price points, there is a decline within both price points under £10, suggesting that there are fewer items in these price ranges than there were a year ago. At the same time, the higher price points have seen more items sold, especially the £10 - £19.99 bracket, which has seen an average increase of 15 items per store at this price point since last year. This has led to this mid-price point selling an
Toy World 32
Melissa Symonds
Director UK Toys, EuroToys NPD
additional 550k units, contributing an additional +£5m in value sales. The higher price points (£20+) have also seen an increase in range, suggesting that there are many items that have increased their base prices in the last year. The average selling price increase of +8% for toys is not consistent across all Supercategories, with some increases much lower. Games & Puzzles has seen average selling price decline, -1% in the first half of 2022, while both Outdoor & Sports Toys and Youth Electronics ASP remains flat. The categories with the highest price increases are Action Figures & Accessories and Vehicles. For the Action Figures supercategory the ASP is now £9.77, while for Vehicles it is £6.83. The highest ASP category is Building Sets at £18.15, although this represents an increase of just +4%. These price changes will include impact of both promotions and product mix, as consumers trade up or down between price points as well. Despite these changes on price point, some of these categories continue to grow in value and have performed stronger than others so far this year, with Vehicles and Plush in particular standing out. Plush has seen strong growth with value sales up +35% YTD June 22 vs. 21, driven by the success of Squishmallows and Ty, while Vehicles value growth is up +8% with Hot Wheels, Monster Jam and HTI’s Teamsterz all in double-digit value growth. Elsewhere, Action Figures has seen strong value growth, up +7% with Marvel, DC and Star Wars all increasing, as well as strong performance from Jurassic World and Minecraft. As the industry heads into the second half of the year - the most important period for sales - it is likely that consumers will continue to be discerning with their toy purchases. They won’t be driven solely by prices, but will continue to look for products with a mix of play value, inventiveness as well as demand from recipients.
