Christmas is almost upon us and I’m behind on everything. The Christmas tree has been standing in the lounge for two weeks now, still waiting to be decorated. I have five presents ready to be gifted, with 20 more that still need to be purchased and wrapped. But I don’t feel that bad because I know I’m not the only last-minute consumer out there.

Year-to-date global toy sales are trending behind last year, when it was alleged that consumers made purchases earlier than usual to avoid disappointment linked to inventory shortages. This year is also behind 2020, when many bought early in anticipation of store closures, and 2016, the last time Christmas fell on a Sunday. So, what’s happening? Will toy sales decline in 2022?

I’ve always believed in the resilience of the toy industry. It has a history of coming out on top, even in the most turbulent economic times. Unlike many other industries, the toy industry has never experienced strong global annual declines. The question is, will we see a turnaround before the new year? This, by the way, is why I get so excited to review our weekly sales data. I’m usually slow to get out of bed in the winter months, but not on Mondays. In fact, I’m always up early on Mondays, eager to see how the toy market fared in the latest week. This is especially important in the fourth quarter. I don’t know how anybody can manage a business without seeing their sales performance in context on a weekly basis.

I see several reasons why I’m anticipating a strong finish for toys this year:

  1. As I wrote in my September 15 blog entry, many European consumers will wait until the last minute to complete their holiday shopping. We saw it in 2016, when the last week of the year was the industry’s best performing in the U.S. and UK. The toy industry is resilient and will adjust to increasing pressures like logistics and inventory management. Speaking of which, it’s more crucial than ever for the industry to maintain inventory through the entirety of the shopping season. Let’s not get caught off guard.   
  2. Over the last two years, most of the sales gains in the global toy industry came from the so-called kidults, teenage and adult consumers who enjoy things like playing board games, building sets, puzzles or collecting action figures. These consumers make up a good percentage of those who wait until the last minute to make their purchases.
  3. 2022 sales of advent calendars in France and Germany – an ancestral tradition – ended up flat compared to 2021. After a slow start and several weeks trending 15% behind, I was concerned that consumers had decided to cut on this ‘little extra’; but they didn’t. The very last two weeks of November rebalanced category sales. Sales in the last week of November were up 50% vs a year ago in France, 40% in Germany and a whopping 75% in the U.S. (ASP is aligned with last year). These are great results and testimony that consumers left it to the last minute!
  4. Consumers are being more careful about their budget, with many of us waiting for last-minute bargains and promotions. According to our recent Price and Discount Trends report in the U.S., for most of 2022, the level of promotions has been lower than the discounts seen in 2020 or 2021. However, in August and September of this year, not only were there a higher percentage of units on promotion, but the depth of promotions was greater than last year. Promotions tend to be at the highest rate in November and December, so we can expect this trend to have continued through the end of the year.

Now, it’s time for me to shut down the PC, decorate my tree, and find my flat boots. I have shopping to do!

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