Following a 1 percent decline in the U.K. toy sector in 2013, this year will see a turnaround and even moderate growth, according to a new forecast by the NPD Group that was commissioned by the British Toy and Hobby Association.
A summer of blockbuster movies, the FIFA World Cup in Brazil, strengthening economic conditions, consumer confidence and an influx of innovative new product will all contribute to the turnaround.
The NPD Group predicts an increase of around 1 percent in value for the U.K. toy industry, bringing sales back in line with 2012 and recovering the loss seen in 2013. Growth is expected to be particularly strong within the building sets and action figure sectors, with a 10 percent increase predicated for the latter.
“Whilst it’s too complex a market to be making any claims about 2014 being a vintage year for the U.K. toy sector, the forecast shows there are a number of factors in place to suggest a stronger year than 2013,” says Natasha Crookes, director of communications, the BTHA. “Great years need to have brilliant toys, but they also need to have significant external factors to drive momentum, and 2014 has a number of those drivers in place to make it a more positive year.”
According to NPD, growth in 2014 will be propelled by four main factors:
- Movie merchandising–Big studio film licenses are expected to generate significant movement in the market with U.K.-specific properties like Postman Pat and Peter Rabbit joining global IPs including Spider-Man, Transformers 4, Teenage Mutant Ninja Turtles and LEGO to drive a £36 million increase in movie-related products for 2014.
- FIFA World Cup 2014–In 2010, the U.K. toy industry benefited from an additional £14 million of sales thanks to the FIFA World Cup. The BTHA forecast estimates similar, or greater, revenues from the 2014 competition.
- Techno toys–Technology played a major role within the top toy lists in 2013, and this is expected to continue into 2014 with augmented reality technology a driving force behind this growth.
- Pocket money toys–Almost half (45 percent) of U.K. toy sales by volume are in the £5-and-under category. It is expected that this part of the market will see an increase as economic confidence returns across the country and pocket money allowances are restored or increased. New collectibles are expected to launch within this sector. Products connected to the FIFA World Cup in the summer will also drive momentum.