The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.Learn More
I presented the Toys and Games: Key Trends Shaping Consumer Demand address at PlayCon held in Arizona, US over May 7-9, highlighting some of the major macro drivers affecting toys and games sales worldwide, including economic and demographic trends, while focusing on the global performance of traditional toys and games, video games and digital gaming. My keynote speech also included an assessment of youth leisure time activities and the role of technology, as well as the typical purchase decision-making process for global consumers when they are buying toys and games.
One of the key trends to emerge at the congress, which was attended by over 150 high-profile toy industry professionals from key companies and organisations, was the unstoppable rise of internet retailing in traditional toys and games. The preliminary findings from Euromonitor International’s latest global research, due to be published in June, confirm this important trend, now shaping the toy distribution landscape worldwide. Increasing internet penetration and usage, competitive pricing and wide product availability have made internet retailing a clear winner in traditional toys and games.
Source: Euromonitor International
Source: Euromonitor International
Global internet retailing of traditional toys and games amounted to more than US$8.3 billion in 2013 and, as highlighted at PlayCon, Amazon is the world’s biggest online retailer of toys. Having started as a books specialist in 1994, it has since expanded into other items, and now has a dedicated toys and games page, stocking a wide variety of toys.
Amazon has a global reach, with deliveries to more than 160 countries worldwide. In addition, Amazon has developed twelve specific websites in the US, Canada, UK, Germany, France, Italy, Spain, China, Japan, India, Mexico and Brazil. An extensive international presence makes the retailer more attractive to niche toy suppliers, such as in educational/scientific toys, which can harness a wider consumer audience through Amazon. The relationship is symbiotic, as Amazon in turn benefits by having a larger variety of toys on its website.
Familiarity and security are among the most important characteristics consumers look for when they shop online, and having a well-established online store has made it easier for Amazon to transition into toys. Amazon had over a 12% share of the global internet retailing market in 2013, more than five percentage point ahead of its closest rival, Alibaba Group Holding.
The popularity of on-line shopping will continue to increase, with most growth happening in emerging markets. Currently, in almost all emerging regions, although internet retailing is one of the most dynamic channels for traditional toys and games, it still represents just a fraction of toy distribution. By 2020, 40% of the global population is expected to use the internet, reducing the digital divide between developed and emerging markets. Many of the most promising emerging economies, notably China and India, could potentially possess some of the most attractive internet retailing environments in the world to tap into. While credit card ownership and delivery may be a challenge, internet retailing remains a very strong option for many toymakers, particularly niche ones, to reach the population outside the main metropolitan centres.