NPD Group: UK toy sales up 3% in 2011 but enjoy 15% Christmas boost

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Top toy sellers in the UK in 2011

Top toy sellers in the UK in 2011

UK toy sales grew by 3% in 2011, according to new research by The NPD Group. 

The NPD Group said the modest overall growth rate last year was a result of disappointing results in September, when the value of sales fell to £181m from £189m in 2010; and October 2011, when sales fell to £227m from £235 million in 2010.

Similar trends were recorded in most other European countries, researchers said.

UK sales recorded a minor improvement in November and patchy trading during December, The NPD Group added.

However, the UK market benefited from a last minute surge in December, especially during Christmas week, which accounts for 5.7% of the UK’s total annual sales. 

According to NPD, toy sales for Christmas week rose 15% to £131m compared with 2010, benefiting from an extra day’s shopping created by Christmas Eve falling on a Saturday. 

The NPD Group’s data also reveals while the UK is still ranked as the number one toy market in Europe, its dominance is slipping. The French toy market – second to the UK – recorded 5% growth last year compared to 2010, while Germany finished 2011 with a solid 7% growth on 2010. 

In Italy and Spain, however, the toy markets did not fare so well. Despite good last minute sales, The NPD Group reports a decline of 3% in Italy and 7% in Spain, whose turnover had already declined by 0.7% in 2010.

Jez Fraser-Hook, UK toy director for The NPD Group, said the UK toy market did well to recover after a slow start to 2011.

“After surprisingly negative trends over the summer, achieving 3% growth by the end of 2011 was a positive achievement for the toy market in the UK. It is also a good indicator that while 2012 will undoubtedly be a challenge, there is still potential for the market to grow.”

Despite economic uncertainties, The NPD Group said toy buyers don’t necessarily turn to low-priced items, but they do devote more energy to bargain hunting in order to buy what they want at the best price.  

The proliferation of promotions in the toy market primarily comes from the online channel, it said. In Europe, the volume of sales generated by online promotions increased by 34% in the last quarter over the first nine months of 2011, whereas promoted sales offline had not shown any growth over the same period.

Fraser-Hook said: “The proportion of sales generated by promotions keeps growing in the European market and UK sales are highly dependent on promotions. Consumers buy more, but also more cleverly and opportunistic buying is stronger than everIn the first nine months of 2011 the share of toy sales made on promotion increased by 5% over the same period the previous year.”

According to The NPD Group, toy sales are also becoming much more of a family affair and faced with the economic crisis, consumers choose to buy toys for their close family, children and grandchildren, as opposed to friends.

Fraser-Hook again: “Across Europe, there was a clear trend in 2011 for friends and neighbours to reduce the number of toys they bought. From January to September 2011 this group of consumers reduced the amount they spent on toys by 22% compared to the previous year. 

“On the other hand, parents and grandparents still spoil their children and grandchildren. Toy purchases made by grandparents have indeed increased by 3% over the same period in 2010.”