retail trends: toys and games in 2018

by: PLAY

The toys and games industry is in a constant state of flux, with manufacturers and retailers striving to find new ways to entertain and educate their audience of demanding children (and picky parents).

In this article we discuss the state of the Australian toys and games industry, which toys and retailers are coming out on top, the online opportunity, parents' priorities, plus the opportunities going forward.

It's time for PLAY to talk all things toys (no PLAYtime puns included.)


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Kids playing with toys and games


State of the industry.

The Australian toys and games industry is worth more than $3.7 billion annually, and Roy Morgan Research revealed that 2.6 million Australians buy toys and/or games in an average four-week period

But, according to Euromonitor, in 2016 toys and games experienced growth despite a slowdown in sales of licensed toys, and some of the more traditional categories.

Video games, construction toys, games and puzzles are mostly responsible for the market’s growth.

In 2017 building sets, play set dolls, collectables, water and sand toys and accessories were amongst the fastest growing, with non-collectable action figures, robotic playmates, fashion dolls and dress-up sales declining.

Electronic and interactive games are also having a moment, as these combine new technology with education - something which keeps both kids and parents happy.

"Today’s tech-savvy kids have influenced changes, such as an updated Play-Doh combining the traditional element with an interactive app." 

- (David Hendy, The Australian Toy Association).

kids enjoying more interactive games

Screen time vs. learning.

Although we've seen massive global growth in the gaming industry (valued at $100 billion globally and nearly $3 billion in Australia), interactive and educational toys are still key contenders as many parents focus on reducing the amount that their kids play with tablets and games consoles.

This is especially true of younger children today vs. the teenagers who have already got into video games.


“This year we’re seeing a bit of a push back against screen time... we’re seeing a real trend towards crafting toys and board games." 

- (David Hendy, The Australian Toy Association).

Pinterest seems to concur that toys are getting more crafty and au naturale. The company released their 'Top 100 Trends to Try in 2018' and 'toys from trees' was flagged in the Kids and Parenting department, with 'wooden toy' saves up 173% last year. Pinterest advised "branch out from plastic with more au naturale options for the toy trunk".


Kids playing with more natural toys

Which retailers are winning?


EB Games has the highest number of toy-and-game shoppers in an average four-week period. Not surprising, when you bear in mind that video games have been a driving force of the industry in recent years.

Discount department stores are up next. In Field Agent Australia’s survey (based on 300 Australian families with children under 12 years old), Kmart (40 percent) was the preferred retailer for parents, followed by Big W (23 percent), Target (15 percent), and Toys-R-Us (11 percent).

From the children’s perspective, Kmart also took the crown, with Toys R Us shortly behind.


outdoor games and toys popular with kids

Opportunities online.

Shopping with kids can be an interesting experience to say the least. Amongst the tantrums, impulse demands and dramas experienced by parents in store, online shopping can seem like a more favourable option.

Parents are also short on time, so ordering something hassle-free online and having it delivered conveniently to their door, can be a much better option. 

Featuring reviews is also key to speeding along the decision-making process to purchase, as amongst all of the product choice, parents like to compare and read peer trusted reviews.

This is especially true online, as children can’t play with interactive displays as they might in-store, and therefore know less about whether they’ll like the toy once it’s been purchased.

Much like the grocery industry, toy retailers with a strong online offering are likely to come out on top, as price-based competition increases and squeezes companies out that aren't adapting or innovating.Purchasing games online for kids

Parents' priorities.

Weighing up affordability, quality, 'what's cool', technology, entertainment, education, longevity, and so on, can be a nightmare for parents while toy shopping. So, what exactly are they prioritising?

According to GutCheck, parents are looking for toys which are durable, unique, can hold attention for several years, and emphasis creativity or development.

As packaging geeks we also think it's worth highlighting that toy packaging, more so than in other product categories, requires clarity of communication.

Packaging must clearly state the benefits, important information such as the age range, instructions to operate it and of course, attention grabbing colours work well (even better if it will be used as a gift!).

In the toy world, and from the parent's perspective, a product's value is derived from a quality build alongside educational/developmental benefits and interactive features.

On that note, while it can be tempting for manufacturers to use extravagant plastic-filled packaging in order to stand out, it's worth remembering that 'simple and easy to open' will make parents' lives easier, and give them (and the child opening the gift) a better experience with your product.

Communication is key here. In order to get ahead in a saturated market where choices can be overwhelming and the paradox of choice comes into play, toy brands should focus on making shopping decisions easier.


Boy playing with lego toys and bikes

Why are toys a great market to PLAY with?

The research shows that parents’ priorities are generally centred around what their children want over and above price/promotions and other factors.

This means that even when times get tough, toys will remain in people’s baskets and shoppers tend not to be as price sensitive as they would with other purchases.

Plus, it's an exciting time to be in the industry, with opportunities for brands to quickly and cheaply get global exposure, as social media provides a platform for viral success.

“While in years past it would have taken something like fidget spinners months to travel internationally, today, social media outlets are allowing consumers around the world to discover new toys at the same time. Trends are amplifying quickly and becoming more widespread, which is both a challenge and an opportunity for the industry.” 

-(Frédérique Tutt, global toys industry analyst at The NPD Group).

toddler playing with toys

Over to you.

One of PLAY's specialities is research for retail brands, so if you are looking to get a better understanding of your market, evaluate your product or even test your communications strategy - we're here to help. Get in touch on 02 8097 0200 or email any time.


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about the author


A boutique insights agency who love to help you decipher complex customer behaviours. Big fans of snappy reports and hot chips. We call Sydney and Melbourne home but LOVE to travel (although lately, our most exciting trip has been from the study to the fridge).

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