Circana - Insight

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This month, Emilie looks at the strength of the Outdoor Toys category and the opportunities it can offer even during Q4.

The UK Toy market has shown an overall decline of -3% YTD up to September 2024, as we head into peak season with the toy community already in full-on Christmas mode. Expectations are high, as 45% of annual toy sales are generated in the last quarter of the year. Even more importantly, the last two weeks before Christmas are expected to account for 20% of October to December salesin line with the last time Christmas day fell on a Wednesday, back in 2019.

Outside of the Christmas period, the Outdoor & Sport Toys supercategory is the third largest category in value sales after Building Sets and Infant/ Toddler/Pre-school toys, and number one in unit sales.

Outdoor Toys accounted for 18% of the total market unit sales YTD, meaning that more than 1 in 6 toys purchased in the first nine months of the year was from this supercategory.

Total Outdoor Toys sales declined -4% in value YTD September 2024 and were flat in terms of units. Sales can vary each year as the weather and seasonality impact trade, with spring traditionally the key time for the category. Outdoor and Sport Toys has been the bestselling supercategory in value sales in April-June each year for the last four years, reaching 21% of value share in Q2 2024. In the summer months (July to September), Outdoor sales were up +15% versus the prior year in the UK. It was the same trend in Summer 2022, but for a different reason; the summer was warmer than average, there were hot spells in each month and the UK reached a record of 40.3 °C in July, driving sales of Pools, Water/Sand toys and Playground equipment.

In 2024, despite the weather not being as warm and sunny, there has been strong growth in Playground Equipment and Pools, with both subclasses gaining an extra +£2m of sales in Q3 2024 versus 2023, suggesting that some consumers were replacing their equipment. In 2020, toy sales, especially Outdoor toys, benefited from the lockdown, as people invested in trampolines, pools, slides and outdoor toys to keep the kids entertained at home. The cost of living crisis and consumers catching up on experiences outside the home may have delayed some of the replenishment in recent years, but consumers seem to have spent in this area again this year. Sport Activities and Games (+11%), Bubble Toys/Solution (+11%) and Water Blasters (+25%) also grew sales this summer.

Playground Equipment (such as Trampoline, Playsets/ Playhouse, Water and Sand boxes) is the largest subclass in value sales, accounting for 28% of Outdoor toys value sales and up +3%, driven largely by Trampolines. There were two trampoline items in the top 10 bestselling toys in YTD September, both over £100 price point. In units, Bubble Toys/Solution is by far the largest subclass, ranked No.4 out of 104 subclasses YTD, and the HTI Bubble Wand 118ml Assortment is the item with the second highest unit velocity in the three months to September.

Price points are polarised in Outdoor Toys, with only 1% of the units sold above £100 generating 21% of the value sales of the category; while 71% of the unit sales purchased were under £5, accounting for 17% of the total value sales. Bubble wands, water bombs, balls and water blasters are some of the lower price items reaching incredibly high sales in sunny weeks, with several outdoor items regularly reaching the top 10 toys bestsellers during sunny weeks, such as Zuru Bunch O’ Balloon 3 pack. Grocers over-indexed and over-performed on Outdoors toys versus total toys. This channel benefits from those low price point impulse purchases, likely bought alongside food to entertain the kids in gardens, parks, beaches, or during a family barbecue.

What are the opportunities for Outdoor toys? The festive season can offer opportunities for Skates/ Scooters/Skateboards, Blasters or even some larger playground equipment such as Trampolines or Playhouses at higher price points, which can be wonderful Christmas gifts for kids. Tapping into additional occasions such as end-of-school gifting, holiday treats, or the International Day of Play can also offer growth for this category. But more importantly, being sure the stock is well positioned in store when the weather is good may be the biggest quick win. Finally, adding licences could also be an opportunity, as only 7% of this category sales feature a licence YTD September 24, compared with 34% for total toys. If 34% of Outdoor Toys were sold with a licence, it could generate an extra £37m YTD for both the toy and licence markets. And we can always hope for snow over the winter to help drive sales of winter Outdoor toys, in the same way summer toys benefit from warm, dry weather.

Item Progression:

The Disney Up House from Lego jumped from outside the top 100 items to the top 5 in September versus August. Several other higher price point items jumped up in the ranking between August and September. Perhaps it was the back-to-school effect, with parents and kids treating themselves with toys to play with inside and beat the wet weather; or some consumers may be thinking of Christmas early this year, to try spreading the cost of buying gifts and shopping around for best pricing.

Top 10 Fastest Growing Properties

The top-gaining property in 2024 so far is Lego Botanicals, driven by new launches and marketing campaigns at key consumption time, spreading the price point offering to fit all consumers and targeting different age groups.

Sport has been a growing theme this year in toys, with two Football properties, UEFA and Match Attack, in the top 10 gaining properties this year. Their sales were boosted by the success of England in the Euro football championship this summer, with consumers buying into a range of products such as Non-Strategic Trading Cards/Collectible Stickers and Strategic Trading Card Games, as well as Action Figures & Collectibles. Non-Strategic Trading Cards/Collectible Stickers has been the No.3 gaining subclass this year so far in the UK toy market, with sales up +13% vs. 2023.

The No.3 and No.5 gaining properties are both vehicle based, with Mercedes-Benz and McLaren being driven by The Lego Group. The top item for the Mercedes licence is the Technic Mercedes-Benz Amg F1 W14 E Performance, at a price point over £150, followed by a smaller pullback version selling at under £20. The top item for the McLaren licence is the Speed Champions McLaren F1 Race Car, also under £20.

Lilo & Stitch is the fourth best-performing property in 2024, generating over four times more value than last year. Its range has expanded to 25 new subclasses this year, with Standard Building Sets, Action Figure Collectibles and Traditional Plush being the three largest in value size. With the live action movie coming up in 2025, it is likely that Stitch’s performance will continue next year.