From the publisher

As we head into the ‘make or break’ weeks of the year, it is inevitable that people start to get a little nervous. A retailer recently flagged up to me that there have been some quite hefty week-on-week sales drops across October compared to last year, although I do think it is important to put them in context.

Last October saw unprecedented demand, with many consumers correctly anticipating an impending lockdown, thus making sure they were stocked up nice and early for Christmas. Amazon Prime Day also took place in October last year: as well as sales driven directly by Amazon and its third-party sellers, many other retailers activated promotions in an attempt to compete. In addition, early Black Friday deals started to arrive at the end of October last year – by comparison, they started to appear almost a month later this time round. Grocers’ half-term promotions were also apparently far more aggressive last year, while Argos ran a half-price toy sale in ’20, which has been replaced by a 33% sale this year.

When you take all of that into consideration, there are at least mitigating factors behind the subdued October data. Historically, UK toy retailers have tended to see an upswing after Halloween and Bonfire Night. So, let’s hope that the October performance was just a blip, possibly exacerbated by supply chain issues. On the positive side, one good week of sales in December can be the equivalent of a month’s sales throughout the year, and at least it doesn’t look like we are going back into lockdown in the UK, as some European territories may yet be facing in the run up to Christmas.

Although the big boys have been more measured with their promotional activity this year, any hope they would cut it out altogether has been dashed in recent weeks. Midco’s Dave Middleton posted a picture on LinkedIn of empty fixtures at Tesco, below posters advertising ‘20% off with Clubcard’ deals. I guess, as with Black Friday, those retailers reached the conclusion that consumers have become conditioned to expect deals at this time of year, so they had no choice but to give them something. While disappointing on many levels, when your Q4 business has been driven by – even predicated around – aggressive promotions, perhaps it is just too big a swing to do nothing at all. Maybe they need to gently wean consumers off the habit rather than forcing them to go cold turkey?

However, there is no doubt that promotions have had to be carefully constructed this year to avoid them turning into loss-making initiatives – and I doubt that is going to change drastically as we head into next year. Talking to suppliers about ’22, the extent to which prices will have to rise next year is occupying much of their brain space right now. One supplier likened it to iconic TV gameshow Play Your Cards Right – you reveal your latest price list to retailers and then play a game of ‘higher or lower’. Obviously, the supplier says higher every time, the retailer says lower. Hopefully, eventually both sides reach the point where ‘the price is right’ (to squeeze every last drop out of the gameshow analogy).

And then, naturally, there is the eternal question of the level (ish) playing field: I was present when a retailer and supplier were talking in general terms about the thorny question of price rises recently, and the retailer was adamant that he would be prepared to accept them (within reason, of course) providing every other toy retailer did the same – with no exceptions. Understandably, he wasn’t prepared to hand a competitive advantage to anyone. So, what happens if and when a particular retailer - and I think most of you know who I am referring to at this point - refuses to accept price increases. I have seen emails that show just how difficult it is to negotiate (in the traditional way) with said retailer. That’s going to make for some interesting discussions next year.

In the meantime, many retailers will already be planning their trip to next year’s Spielwarenmesse – so we are delighted to help the process with an early look at some of the companies which will be exhibiting and a sneak peek at what they’ll be showing. This month’s Nuremberg preview starts on page 36, and there will be a further round-up next month, when even more companies will be able to share details of their new lines for ’22. That edition will also include an exhaustive preview of the London Toy Fair - the toy community is already getting excited about being able to meet up at Olympia, and with no Hong Kong trip this year, Olympia will be the first show of the year. I am very much looking forward to London kicking Toy Fair Season ’22 off with a bang.