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Toy Industry Predictions for Holiday 2017

Mar 13, 2017
Juli Lennett, Senior Vice President, Industry Analyst ;
Toys

Spring is in the air, but it’s also an opportune time for toy industry players to begin planning for the next holiday season. If 2016 is any indication, a fresh strategy will be even more essential for Holiday 2017.   

From January through November 2016, U.S toy sales grew a healthy 5.5 percent, positioning December for potentially high single-digit growth. But, December toy sales were less than expected, growing only 3 percent and actually bringing annual 2016 growth down to about 5 percent. What happened?

There were several factors contributing to the toy industry’s slowdown in December. However, the most significant area of concern was Week 51, the week before Christmas and Hanukkah, which had explosive growth of 28 percent. Why should the industry be alarmed by this?

With the week before Christmas offering two additional shopping days, one being a Saturday, consumers waited until the last minute to shop. As a result, week 51 was the largest sales-generating week of the year by ½ billion dollars over the previous top week and grew to represent 10 percent of all toy sales for the entire year. This happened in lieu of consumers spreading their shopping visits over several weeks. When there are fewer shopping visits, there is less cumulative spending.

The situation is even more critical this year, as Christmas falls on a Monday. Warm weather aside, to be in the best shape possible in 2017, toy retailers and manufacturers need to figure out how to create more excitement and generate additional shopping visits throughout the holiday season—not just the weekend before Christmas.

Source: The NPD Group, Inc. / Retail Tracking Service


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