No Joy in Toyland
By George Anderson
It’s tough in the toy business. After two consecutive years of sales declines, the industry may be headed for a third as a combination of economic factors has many Americans considering cutting back spending this holiday season.
Francie Todd is the mother of two boys who lives in East Lansing, Mich. “You look at the economic climate overall, and this is not a good time to run up the credit cards,” she told The Associated Press.
She also says that the devastation in the Gulf Coast has given her pause to reconsider what celebrating the holidays is all about. “We want to be more about the experience of giving, and less about the getting,” she said.
Ms. Todd is not alone in her thinking and retailers have already begun lowering prices on toys to provide consumers with incentives to shop early.
Many wonder, however, if even low prices will be enough.
Jim Silver, editor-in-chief of the trade publication Toy Wishes, told the AP, “It’s going to be extremely competitive to draw customers to their stores.”
Wal-Mart has dropped prices on some popular toys by up to 30 percent and competitors, such as Target and Toys R Us, are following suit.
“We will absolutely be competitive with Wal-Mart this holiday season,” said Lena Michaud, a Target spokesperson.
Toy sales were down five percent this year in the period from January to August, according to NPD Group.
Moderator’s Comment: Are a large number of consumers reevaluating their whole approach to the holidays? What will that mean for toy sales and all of
retailing, for that matter? –
George Anderson – Moderator