General Overview of the Toy Market

Mintel Report November 2008

How can Toy manufacturers capture the child's imagination?
The market for children’s toys and games is a substantial one – currently worth £2.1 billion, up by 18% in real terms on 2003. Given the widely differing needs of its target market by age, the market is necessarily highly diverse, ranging from cot toys, simple games and early learning toys for infants, through to more sophisticated toys for older kids up to adulthood. There is no cut-off point by age for many board games, for instance.

Increasingly, the market is characterised by licensed products, which are now estimated to account for around a third of sales. This is a vital driver to sales, but has drawbacks as discussed in the report.

Children’s innate enjoyment of play alone is enough to ensure the market is robust and will continue to be so. However, growth has stuttered to a halt at least temporarily, and sales are estimated to have declined slightly on 2007.

Strengths and Weaknesses in the Market 

The attractions of collecting ensure repeat sales once the initial appeal is established.

Toys and games have universal appeal to all kids.

Parents support many toys as a way to learn through play.

Non-parents – other family and friends – are also active buyers.

Regular infusion of new products refreshes the market.

Awareness of licensed products boosted by extra visibility in other formats (eg TV and film, books, comics, clothing).

Crossover appeal to adults (eg traditional board games, models, train sets).

Toys and games are a good holiday gift eg from grandparents – ‘here’s what I bought you when I went to Scotland’.

Kids’ tastes can be highly unpredictable and sudden fads cause problems in meeting demand.

But with no ‘must-have’ toy or game then sales can be sluggish.

Competition growing from more forms of digital media.

The window of childhood is shrinking as kids move more quickly to adult-oriented lifestyles.

A crowded and heavily branded market means new entrants face higher barriers to entry.

Pocket money toys are highly price-sensitive.