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Toy Revenue in UK Sees 5% Boost in 2020

The toy industry in the UK followed global trends, which generally have seen a significant boost in sales and revenue despite—or perhaps because of—the COVID-19 pandemic. Sales were particularly hot during the first lockdown during the spring in Britain, which saw an astounding 22 per cent boost in spending for the sector, according to figures from The NPD Group.

Sales in the UK fell off from that early high, but remained strong overall with total sales revenue ringing in at $4.5 billion (3.3 billion pounds), which allowed the country to maintain its position as the largest market for toys in Europe, and the fourth largest in the world.

This revenue boost for the toy sector occurred even as retailers wrestled with an extremely difficult environment for sales, due to rotating lockdowns throughout the year, and manufacturers dealt with significant supply chain issues in the early months of the year. However, the main driver of revenue appeared to be the powerful need to keep children and adults alike entertained in a year when other types of diversions, such as movie theaters, concerts, restaurants, sporting events, and travel were off the table for much of the population.

 “2020 was an extremely challenging year for retail as a whole, and toy retailers of all sizes had to adapt and innovate in this difficult environment in order to ensure consumers could still obtain the products they require,” said Roland Earl, Director General at the British Toy & Hobby Association. “The end of year statistics reflect the role that toys and games played in bringing enjoyment and assisting families and individuals to navigate the difficulties of repeated closures and lockdowns. Despite varying functions, objectives and age suitability, all toys are ultimately designed with one overarching goal—to bring fun, enjoyment and play value to the recipient and never has this been more important.”

“Looking ahead to 2021, the uncertainty surrounding the pandemic will remain for some time, though toy designers will continue to innovate during tough conditions to ensure families have access to the items they want and need,” Earl added. “Brexit will continue to have an impact on all industries in 2021, and the toy sector specifically will continue with its thorough preparation following the (Brexit) deal announced at Christmas.”

Dominant trends for the year in toy sales

Two primary drivers appeared over the year as the British people faced an entire year of restrictions and outright lockdowns. On the one hand, kids and adults alike were dealing with a lot of boredom because of the restrictions on other activities, and on the other, many families found they had more disposable income because they weren’t spending as much on travel, entertainment, restaurant meals, and fuel.

One reason for the growth was explained during a seminar at the Festival of Licensing Leadership Summit by Juli Lennett, a toy industry analyst at the NPD Group. Lennett explained that as children were isolated at home and anxious about the dangers of the pandemic, parents reacted logically by diverting spending to toys and games that safely keep their kids occupied at home or out in the yard.

“Parents will think first about safety for them and their kids when it comes to shopping, get-togethers, and play,” said Lennett. “Toys that support social and safe play, potentially among smaller groups, will align with the needs of parents and kids.”

Safety aside, Lennett said parents naturally feed bad about the restrictions their children are going through, especially as many children reported feeling fearful and anxious as they returned to school.

“Even in difficult times parents put their children ahead of their own needs,” Lennett said. “And this year especially has been extremely difficult for kids. Parents feel bad for their kids and want to make them feel better, and what better way than toys?”

In the first quarter of 2020, as the coronavirus sank its claws into the world’s economies, the Games and Puzzles category boomed by an astounding 37%, while Outdoor and Sports Toys grew by 27%. The other big winners by category were Building Sets (+14%), Arts and Crafts (+11%), and to a lesser extent ‘Explorative and Other Toys’ (+1%).

While those figures reference the US market, the picture for the UK is similar. In general toys, games and puzzles that provided long-term entertainment saw prodigious growth in 2020, the NPD found.

Games and Puzzles saw the highest category growth (+19%), with families spending more quality time playing together. Puzzles, which can be enjoyed both in groups and individually, increased by 38%.

Building Sets and Outdoor Toys also experienced significant growth in 2020 growing by 18% and 15% respectively. Good weather in the spring and early summer lockdown provided opportunities for families to bring fun and add in some exercise to combat the increase in indoor screen time. They also had the benefit of helping to compensate for missed holidays at Easter and in the summer.

The periodic closure of schools also meant that many parents turned to educational toys for assistance to help bolster their children’s cognitive development. This drove a 9% increase in sales of Learning and Exploration toys such as Scientific Sets and Musical Instruments.

The lockdown also meant adults were just as bored as their kids, and the NPD Group found that what they call “Kidults” were responsible for more than one-quarter of total toy sales. “In addition to these trends, we saw further evidence of ‘kidults’ appetite for toys,” the NPD report states. “This adult and teen category now represents 27% of total toy sales, up by 16% since 2016. In 2020, with more time on their hands, kidults completed complex building set kits, played more games and entertained themselves with puzzles. As this group tends to purchase higher priced toys, their buying power helped increase the average sales price of toys overall.”

Christmas came early in 2020

Britons also showed foresight when it came to shopping for the all important Christmas season. Having gone through multiple rounds of lockdowns or enhanced restrictions, it appears most Britons were aware that Christmas shopping could be disrupted by the pandemic, and heeded advice to shop early. For that reason, the UK industry saw a momentous November, up 11% YOY followed by lower than usual sales in December (down 9% YOY). “This was exacerbated by lockdowns in November and December, forcing many retailers to close in what would normally be their busiest period,” the NPD says. “Classified as essential retail and therefore able to remain open during lockdowns, grocery chains fared well for toy sales in the last two months, up 10% YOY.”

While the news for the toy sector was generally rosy overall, there were winners and losers in the COVID sweepstakes, the NPD notes. “With movement restricted and many retail sectors closed for business, Britons moved online to buy their toys. Retailers adapted and maximised their omnichannel offering to reach customers during lockdowns and tiering. As a result, in the 12 months ending September 2020, online toy sales grew to almost half (49%) of all sales.”

Frederique Tutt, Global Industry Analyst at The NPD Group, believes the pandemic experience will provide a solid foundation for a strong toy sector in the coming years, because families have again realized the importance of play and togetherness.

 “One thing is certain,” Tutt says. “The importance of playing together with toys, games and puzzles as a family, group or alone has been re-established during the lockdowns. Many people have also rediscovered the value of nature and the environment in the pandemic, and one encouraging sector trend is that green issues have come to the fore, and many manufacturers are reducing packaging and incorporating eco-friendly materials in their products.”

The top toys of 2020 in the UK

Tutt also says the top toys typically were those that provided long-term enjoyment and entertainment. “The top 15 sellers of the year tell much of the story for toys in 2020,” Tutt said. “We turned to toys and games to help fill the long weeks of lockdown. Toys provided the hub for fun, entertainment, education, exercise and stress relief. They helped make the decidedly abnormal feel normal—especially at Christmas. Manufacturers and retailers worked hard to meet the need for toys of all kinds for all ages, shifting sales to online and Click & Collect, and to grocery chains to fulfil demand. 2020 accelerated changes already underway in the toy sector and underlined the importance of innovation, strong supply chain and channel management.”

RANK MANUFACTURER TOY
1 MGA ENTERTAINMENT L.O.L. SURPRISE! O.M.G. FASHION DOLL
2 MGA ENTERTAINMENT L.O.L. SURPRISE! DOLL
3 HASBRO MONOPOLY CLASSIC
4 MGA ENTERTAINMENT L.O.L. SURPRISE! HAIRVIBES
5 MATTEL HOT WHEELS SINGLES
6 SPIN MASTER PAW PATROL VEHICLE AND PUP
7 VTECH KIDIZOOM DUO DX
8 VTECH KIDIZOOM SMART WATCH DX2
9 MGA ENTERTAINMENT L.O.L. SURPRISE! O.M.G. REMIX DOLL
10 ASMODEE EDITIONS DOBBLE
11 MATTEL BARBIE DREAMHOUSE
12 MATTEL BARBIE COLOUR REVEAL DOLL WITH 7 SURPRISES
13 THE LEGO GROUP SUPER MARIO BROTHERS ADVENTURES STARTER COURSE
14 MATTEL UNO CARD GAME ASSORTMENT
15 THE LEGO GROUP TECHNIC LAND ROVER DEFENDER

One final note for the year is that, due to the massive decrease in the number of movies and TV shows released in 2020 due to pandemic restrictions, the normal cycle of toys gaining popularity around the strength of a blockbuster movie has not really occurred in 2020. However, once the vaccine rollout occurs, and films come back to movie theaters, there will be a large backlog of licensing deals that are already in the works, that will greatly influence toy sales over the coming year, Tutt notes.

“Finally, when cinemas hopefully reopen later on in the year, blockbusters will boost toy sales once again,” Tutt predicts.

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