Toy Retailing - UK - December 2008

Table of Contents

• Issues in the MarketKey themes
• Definitions
• Abbreviations
• Market in Brief
• Steady and stable
• Show time
• The big three
• Independents lose out
• It' s a squeeze
• Multichannel pull
• Toys lose favour
• Make it an experience
• Tough and tumble
• Industry Insights
• Key points
• Flat or falling
• New kids on the block
• Brands still strong
• Winners and losers
• Seasonality
• Getting the range right
• Price discounting and promotions
• Average prices falling
• Rip-off Britain?
• Opportunities in the marketplace
• Wow service
• The impact of the credit crunch
• Outlook for the market
• Internal Market Environment
• Key points
• Rising costs for retailers
• Downward pressures on retail pricing
• Independents lose out to multiples
• Ten weeks
• Price discounting and promotions by retailers
• Supermarkets help impulse purchase
• Growth in the internet as sales channel
• Multichannel
• New and exciting
• Crazy crazes
• TV and film fame
• Product recalls
• Broader Market Environment
• Key points
• Christmas is coming later
• Recession-proof?
  • Figure 1: Trends in PDI and consumer expenditure, 2003-13
• Growing younger
  • Figure 2: Child population, by age, 2003-13
• Older kids have expensive taste...
• ...but more oldies than teens
• Rich kids
  • Figure 3: Socio-economic breakdown of population, 2003-13
• Kids growing older younger
• Nanny state
• Made in Britain
• Reduce, reuse and recycle
• Split sales
  • Figure 4: Change in the number of divorces, 2003-13
• Unfavourable exchange
• Market in Context
• Key points
• Spending on children
  • Figure 5: Consumer expenditure spending on toys and games compared to other areas, 2003-07
• Kids love toys
  • Figure 6: Children' s spending -- 7-10-year-olds, 2004-08
• Older kids prefer snacks
  • Figure 7: Older children' s spending -- 11-14-year-olds, 2004-08
• Super savers
• Strengths and Weaknesses in the Market
• Strengths
• Weaknesses
• Market Size and Forecast
• Key points
• Solid and stable
  • Figure 8: UK sales of toys, 2003-13
• Price vs. passion
• The future
• Factors used in the forecast
• The Consumer -- Where They Buy Toys and Games
• Key points
• Consumers love the book
  • Figure 9: Outlets used for buying toys and games, September 2008
• Any place will do
• Changing preferences
  • Figure 10: Outlets used for buying toys and games, 2006 and 2008
• ELC pull
• Supermarkets expand in non-foods
• Destination Disney
• Who shops where?
  • Figure 11: Market positioning of toy retailers, by age and affluence of buyers, September 2008
• It' s a family affair
• Choose a gift from the book
• Preschoolers love ELC
• Mothercare for mummies
• Toys are all of us
• Supermarkets still have more to gain
• Internet broadens appeal
• Where' s the loyalty?
  • Figure 12: Number of retailers used for buying toys and games, by retailer used, September 2008
• Average toy buyers shop at 3.4 retailers
  • Figure 13: Number of retailers used for buying toys and games, by retailer used, September 2008
• The Consumer -- Factors That Would Encourage More Shopping
• Key points
• The wish list
  • Figure 14: Factors that would encourage more shopping at a particular store, 2006 and 2008
• Time to choose
• Ease of evaluation
• No hassle
• Information
• Who wants what?
  • Figure 15: Factors that would encourage more shopping at a particular store, by outlets used for buying toys and games, September 2008
  • Figure 16: Factors that would encourage more shopping at a particular store, by outlets used for buying toys and games, September 2008
  • Figure 17: Factors that would encourage more shopping at a particular store, by outlets used for buying toys and games, September 2008
• Children' s Playing and Leisure Habits and Typologies
• Key points
• Toys compete for share of children' s time
  • Figure 18: Children' s playing and leisure habits, September 2008
• Top of their game
• Bookworms
• Hyper-parenting
• Sociable or solo
• Identifying targets
  • Figure 19: Toy retailing typologies, September 2008
• Group 1: Studious (25%)
• Who are they?
• Group 2: No Views (19%)
• Who are they?
• Group 3: Tech Kids (35%)
• Who are they?
• Group 4: Traditional Child (22%)
• Who are they?
• ELC attracts buyers for Tech Kids
  • Figure 20: Consumer make-up of selected toy retailers, by typology, September 2008
• Buyer for the Traditional Child want the most improvements
  • Figure 21: Factors that would encourage more shopping at a particular store, by typology, September 2008
• Channels of Distribution
• Key points
• Dynamic distribution changes
  • Figure 22: Toys and games distribution channel, 2003-07
• The big three
• Specialists going
• Good news for generalists
• Not just doctor' s orders
• Supermarkets shining
• Department stores are not destinations
• Buying groups
• Others
• Home shopping
• Retail Competitor Analysis
• Key points
• Specialists under pressure from mass merchandisers and supermarkets
  • Figure 35: Estimated market share of major players, 2003-07
• Multichannel success
• Tough competition
• Tesco going after Argos
  • Figure 36: Review of major players, 2008
• Rationalisation
• Learn a lesson from ELC
• Difficult times
• The Entertainer aims high
• Retailer Profiles
• The Disney Store Ltd
  • Figure 37: The Disney Store Ltd: Group financial performance, 2003-07
  • Figure 38: The Disney Store Ltd: Outlet data, 2004-08
• Early Learning Centre Ltd
  • Figure 39: Early Learning Centre Ltd: Group financial performance, 2004-08
  • Figure 40: Early Learning Centre Ltd: Outlet data, 2004-08
• The Entertainer (Amersham) Ltd
  • Figure 41: The Entertainer: Group financial performance, 2004-08
  • Figure 42: The Entertainer: Outlet data, 2003-08
• Games Workshop
  • Figure 43: Games Workshop: Group financial performance, 2004-08
  • Figure 44: Games Workshop Ltd: Outlet data, 2004-08
• Hamleys
  • Figure 45: Hamleys of London Ltd: Group financial performance, 2003-07
  • Figure 46: Hamleys: Outlet data, 2004-08
• Toys ' R' Us
  • Figure 47: Toys ' R' Us UK Ltd: Group financial performance, 2004-08
  • Figure 48: Toys ' R' Us UK Ltd: Outlet data, 2004-08
• Smyths
• Build-A-Bear
• Non-specialists
• Argos
• Woolworths
• WH Smith
• Mothercare
• Boots
• Tesco
• Asda
• J Sainsbury
• Department stores
• Home shopping
• Retail Advertising and Promotion
• Key points
• Spending more for less
  • Figure 49: Main media advertising expenditure by toy stores, 2004-07
• Reliant on manufacturers
  • Figure 50: Main media advertising expenditure, by retailer, 2004-07
• At any cost
• Other forms of advertising
• What works best?
• Online restrictions
• Appendix -- Where They Buy Toys and Games
  • Figure 51: Outlets used for buying toys and games, by demographic sub-group, September 2008
  • Figure 52: Outlets used for buying toys and games, by demographic sub-group, September 2008
  • Figure 53: Outlets used for buying toys and games, by demographic sub-group, September 2008
  • Figure 54: Number of different outlets used for buying toys and games, by demographic sub-group, September 2008