NPD Insight

The next big thing

This month, Rory takes a detailed look at the licensed toy category, and the variety of content sources currently affecting market trends

Licences are an important part of the overall toy market: however, the value size of the category can fluctuate from one year to the next. Over the last few years, we have seen licensing consistently outperforming the total toy market in the UK. Based on YTD July data, licensing makes up nearly 29% of the overall toy market value this year; this is nearly +6% higher than at the same stage in 2019. The overall trend for licences in 2022 so far is up +2% in value - but bear in mind this is in a market that is currently tracking at -5%. So, let’s take a closer look at what is contributing to the healthy state of licensing in the UK and try to understand some of the key trends.

If we look at the areas where growth is coming from, we can see that the fastest growing segments are movies and video games, with growth of +7% and +13% respectively vs. the same period in 2021. TV/ digital properties are down -2% vs. last year, which is still ahead of the overall market – indeed, this segment is about the same size in value as movies and video games combined. Looking at the segment with fastest growth first, video games, we can see that this has doubled in value size since 2019: it now makes up around 6% of the overall toy market in the UK. One of the key reasons for this growth has been the strength of Pokémon over the last few years; in 2022 this licence accounts for nearly half of all video game related sales.

Trading Cards continue to be main contributor to Pokémon growth, but there has been expansion into other categories with Plush, Action Figures and Games all adding value in 2022. There has also been growth from other Video Games licences, with Minecraft, Sonic the Hedgehog and Among Us all adding sales in 2022.

Movie licences have enjoyed a strong year in 2022, with a +7% trend so far. If we look at the monthly data, we can see movies grew by +22% in June and then +32% in July. The healthy line up of summer movies this year has had the desired effect on toy sales, with over £10m more spent on movie lines for those two months vs 2021. The top movie property in 2022 is Star Wars, which is interesting as this has clearly been influenced more by streaming than cinema. Popular series streaming on Disney+ for The Mandalorian, Boba Fett and Obi-Wan Kenobi have been the key driver of sales, contributing to the +13% value growth this year. Marvel Universe is at No.2, with growth of +10%, driven by some major movies. The top product sales performance of the big summer movies is Jurassic World Dominion, with Jurassic Park the top growth license in the total toy market in 2022. In July, 14% of all movie-related sales were from Jurassic Park/ World, with Lightyear accounting for 5% and Minions just over 2%. Other notable movie licences for 2022 are Harry Potters Wizarding World with growth of +15%, and Batman with growth of +79% after the release of The Batman in March.

The final area to analyse is TV/Digital, which may be down -2% in 2022, but still represents one of the largest areas of the market. There are some big properties taking up the top spots within this area such as Paw Patrol, Peppa Pig and Lego Ninjago. However, some of the key growth is coming from properties just outside the top 10, with Bluey and CoComelon being two of the top performers, again showing the influence of streaming on toy market trends. The Muppets is another top growth licence being boosted by the recent Minifigures range from The Lego Group. Looking at July only, TV/digital properties grew by +5%, with some interesting new licences in the top growth list. Stranger Things is the 4th top TV/digital growth property, showing the kidult trend is still boosting toy sales. In at No.10 for growth in its launch month is Gabby’s Dollhouse, which is now beginning to replicate its US success here in the UK.

One of the strengths of the licensed toy market is that content now comes from so many diverse places. Current trends show that there is crossover between movies, TV, streaming and video games & digital content, so it will be interesting to see where the next big licensing hit comes from.

Item Progression:

Bunch O Balloons from Zuru moves up 27 places vs. its property rank in June. The popular outdoor property saw a boost in sales in July after the UK experienced soaring temperatures and the driest July since 1935. Sales in July were around 50% higher than June, while the Bunch O Balloons Recycle Balloons were the No.3 item in the total toy market for the month.

Fastest Growing Licences in Toys

The top growth licence in the UK toy market is Jurassic Park/ World. Jurassic World Dominion was released in UK cinemas on June 10th, and this has lead to strong growth for the licence over the summer weeks. Building Sets and Action Figures are the two key categories for the licence: together these were worth over 80% of the total sales this year. Spidey and his Amazing Friends is the 2nd top growth licence with sales across a number of subclasses, particularly Building Sets and PS Figures & Playsets. The series has been streaming this year and has given the licence a boost, following on from the No Way Home movie at the end of 2021. Another movie licence is at No.3, where we see Batman benefitting from the latest movie release in March. Interestingly, the top item for the Batman licence is the Batman The Dark Knight Trilogy Batmobile Tumbler from The Lego Group - an item from a previous movie. This suggests that the kidult growth trend is still going strong, with this item coming in at an average price of just under £170.