What will be the toy story of Christmas 2021?
Retail toy sales got off to a hot start in 2021. How well the category performs, however, particularly during the critical Christmas season, remains to be seen as a host of factors complicate what would otherwise be expected to be a big year.
U.S. toy sales improved 27 percent to kick off the first four months of the year, according to The NPD Group. Ten of eleven categories were showing growth year-over-year during that span with all posting gains based on a two-year comparison during the same period. Last year’s sales were up 16 percent compared to 2019.
Manufacturers and retailers have sought to get an early start on ordering supplies ahead of the Christmas season as they deal with ongoing pandemic-related shipping delays from China, where the majority of American consumers’ toys are sourced, reports The Wall Street Journal.
The importance of toys as a traffic and revenue driver are as important, perhaps even more so, heading into this year’s holiday season. Supply challenges and heavy demand have resulted in higher prices on goods paid by consumers and should yield higher rings per purchase for merchants should they avoid extensive discounting.
Target announced earlier this week that it would have Disney shop-in-shops operating inside 160 of its locations across the U.S. by Christmas. Disney has chosen to close many of its company-operated stores outside of resorts to focus on partnerships, such as the one struck with Target. The chain also published Bullseye’s list of the top 50 toys for the holiday season including 22 new items that can only be purchased at the retailer. Target said it will offer over 1,300 exclusive toys and games for the holidays.
Macy’s is also looking to capture some toy magic with its newly announced deal with WHP Global to establish Toys “R” Us shops in more than 400 of its stores and on macys.com.
“Our toy business grew exponentially in the past year, with many families looking to inspire their children’s imagination and create meaningful moments together.” said Nata Dvir, Macy’s chief merchandising officer, in a statement . “Toys ‘R’ Us is a globally recognized leader in children’s toys and our partnership allows Macy’s to significantly expand our footprint in that category, while creating more occasions for customers to shop with us across their lifestyles.”
- Toy Prices Are Going Up Ahead of the Holiday Season – The Wall Street Journal
- Bullseye’s Top Toys List is Back and Better than Ever, Plus Big Disney News – Target Corporation
- Macy’s and WHP Global Partner to Bring Universally Beloved Toys”R”Us Brand Back to American Shoppers – Macy’s, Inc.
- The NPD Group: U.S. Toy Industry Sales Experience +27% Increase Year-to-Date – The NPD Group
DISCUSSION QUESTIONS: Are you expecting toy unit sales to outperform last year’s Christmas selling season or will supply chain issues and high prices limit growth? Do you expect shop-in-shops such as Target/Disney and Macy’s/Toys “R” Us to become more commonplace in the market?