• by Karl Greenberg , September 15, 2008

Port Washington, N.Y.-based NPD Group reports that global toy sales were up 5% last year, generating $71.96 billion dollars versus $68.5 billion in 2006 sales; the firm expects worldwide toy sales to reach $86.3 billion in 2010.

 

According to the group's new report, Global Toy Trends and Forecasts, North America--which constitutes 33% of worldwide sales, followed by Europe at 30% and Asia at 24%--slid 2.4% last year to $22.3 billion, from $22.8 billion in 2006. Year-to-date through July 2008, toy sales are down 0.9% in the U.S.

The numbers this year and last are tied to softer sales of dolls, infant/preschool, outdoor/sports, youth electronics, and toy vehicles--off 10.7%, 3.4%, 5.4%, 3.2% and 19.2%, respectively. Of those, only toy vehicles saw positive sales in 2007.

Anita Frazier, research analyst at NPD, says there is no single reason that toy sales have lagged in the U.S. "I think it has been largely the result simply of more choices," she says. "[Consumers have] more choices than ever before competing for their limited free time. Computers, cell phones, personal digital music players, video games--many of these didn't exist, at least as ubiquitously, as they did in years past. Even greater amounts of homework and extracurricular activities are stealing time away from free leisure time."

Games and puzzles, building sets and plush toys are the three categories that have recovered in the first seven months this year after a soft 2007. Their sales have improved 5.8%, 21.2% and 50%, respectively, through July this year.

"The Games/Puzzles supercategory is one of the most resilient and evergreen," says Frazier. "Gameplay is one of the most popular and pervasive play patterns regardless of whether it's in a traditional board game format or on a digital device, and there really isn't evidence that video games and the like are having a major impact on board game performance."

Frazier says that Action Figures and Accessories was one supercategory that had a big year in 2007 because "there was just such an enormous slate of high-profile action movies," she says.

The firm predicts the U.S. toy market will recover, generating 8.8% sales growth by 2010. What will drive sales growth? "The biggest impact is from the growing size of the kid population."