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Strong Growth in Global Toy Revenue in 2021 to End in 2022

NDP Report Points to Coming Decline Due to Inflation, and Underlines Importance of Licensing to Toy Industry

By Gary Symons

TLL Editor in Chief

The toy industry had its best year in a decade in 2021, as people turned to play during dark economic and political times.

That’s the conclusion of  The NPD Group’s latest global toys report, which says the global toy market surged to $104.2 billion in 2021.

That’s an impressive 8.5% increase over 2020, and 12.7% over the pre-pandemic figures in 2019.

NPD says most of that growth came from the developed countries, and particularly from the United States, which enjoyed a 15% increase in year-over-year sales revenue.

By contrast, developing markets that were more seriously impacted by the pandemic’s effect on their economies started to recover in 2021, but did not manage to overcome the 2020 decline or reach pre-pandemic sales levels.

“The global toy market’s unprecedented growth in 2021 was driven by sales in developed countries, which were better equipped to face the pandemic thanks to strong government support, as well as easier and earlier access to vaccinations,” said Frédérique Tutt, global toys industry analyst at The NPD Group. “However, we don’t anticipate this level of growth to continue as the global economy slows down and inflationary pressures increase.”

In contrast, despite sales growth in 2021, the Asian market remained behind 2019 sales, with the gap between North America and Asia increasing five times compared to 2019. However, even with a slow recovery, Asia is the second fastest growing region when compared to 2016, increasing 11%. North America experienced the fastest growth, increasing 51% since 2016.

NPD says growth was primarily driven by the world’s 10 largest markets, with these 10 representing 76% of global sales in 2021. The toy market remains very concentrated within the U.S. and China, both capturing close to 50 percent of global sales.

The global spend per child aged 0 – 9 increased to $59, up from $56 in 2020. Spend per child in Asia, Africa, and South America remains below the global average.

Another trend that won’t surprise licensing professionals is that sales of licensed toys are at their highest level since 2008, the year that plunged the world into a major recession.

In short, licensing deals involving toys has recovered all lost ground since the 2008 recession, and then some.

Sales of licensed toys are at their highest since 2008, new data from NPD has shown.

Star Wars remained the top movie franchise when it comes to licensing in the toy industry.

The bad news for toymakers is that sales in 2022 are falling off from 2021, but licensed toys are doing better than non-licensed toys.

Licensed toys now account for 30% of all toy sales this year, according to figures obtained by NPD through its retail partners.

By remaining relatively flat at -1%, licensed toy sales have out-performed non-licensed toy sales which are currently down -11% in value for the year-over-year figures up to May 2022.

NPD also revealed the licenses that are driving the most toy sales, which include Star Wars, Harry Potter, and Minecraft.

Big name movies have also helped to drive up sales further, particularly from Jurassic World: Dominion, Lightyear and Minions: The Rise of Gru.

“We’ve already seen strong growth from movie releases this year such as The Batman driving toy sales up +84%, and Marvel Universe up +12%,” said Melissa Symonds, executive director at NPD. “Even ahead of their film launches, the Jurassic World toy license is up +63% and Minions up +79% so far this year. While prices and the cost of living pose a real-world challenge, cinema can provide an escape from everyday life. By buying toys related to the film they’ve just seen, kids can live in that world a little longer.”

Simmonds also says the multi-channel strategy adopted by most of the big studios allows them to offer new content to fans continuously, instead of being restricted by one big movie release every three years. Disney is the best example of that, as its Marvel and Star Wars franchises have their own channels on Disney+, and are getting an expanded universe of new TV series to add to their film franchises.

“Many of these summer blockbusters have additional content available,” Simmonds explained. “There are series available on video-on-demand platforms such as Camp Cretaceous for the Jurassic saga, or Star Wars’ Obi-Wan Kenobi, not to mention the various Marvel streaming shows such as Ms. Marvel and Moon Knight developed around the lesser-known characters which enrich and extend the appeal of the franchises.”

PAW Patrol: The Mighty Movie is a sequel set for exclusive theatrical release on October 13, 2023, and continues Spin Master’s monumental success in combining entertainment with its toy brands. (CNW Group/Spin Master)

But not all of the impact came from the big Hollywood studios. Another trend is that toy companies’ strategy of transforming into entertainment and play conglomerates is helping drive sales through film and TV series.

NPD data says the top five movie properties for the Year-to-Date, up to May, include Star Wars, the Marvel Universe, Barbie, Pokemon, and PAW Patrol.

Of the five, two of them are productions put out by toy companies Mattel and Spin Master.

The halo effect of licensing is also expected to increase in the latter half of 2022, says Simmonds, as the film industry returns to normal.

“2022 looks set to be a record year for licensed toys,” said Simmonds. “With the big screen making a comeback, all eyes are on the summer blockbuster movies, but we also expect to see non-cinema licensed content performing as a powerful catalyst for the toy market thanks to TV, YouTube, subscription video on demand and video games. This should bring us one or two points of growth over the whole year.”


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