Toys‟R”Us Liquidation and Early Easter Align, Bringing Additional Sales to Growing U.S. Toy Industry, Reports The NPD Group

In the first 10 weeks of 2018, when the toy industry was in a "business as usual" state, U.S. dollar sales grew by 2 percent – on par with the results during this time last year, according to global information company The NPD Group. The proceeding four weeks brought two unique circumstances which converged to further lift the industry: the beginning of the toys‟R"Us liquidation (March 15) and an early Easter (April 1). In those weeks, from March 11 through April 7, toy sales grew by 36 percent over the same period in 2017 – driving year-to-date growth for the 14 weeks combined to 13 percent.

Regardless of when it falls on the calendar, Easter sales volume typically experiences a bump in the two weeks leading up to the holiday, providing an annual boost for the industry. Norm alizing the year-to-date sales trend to split out Easter and decipher the impact of the Toys‟R"Us announcement, results in around $180 million more being generated between March 11 and April 7, 2018. This represents additional toy industry sales that may be attributed to the Toys‟R"Us liquidation.

Among U.S. consumers who purchased a toy, game, or arts/crafts product from Toys‟R"Us or Babies‟R"Us for someone in the last month, the majority (56 percent) did so to give to someone immediately, according to a poll conducted by next generation polling and data mining company CivicScience, on behalf of NPD. Of those remaining, 12 percent made purchases to give by June; 10 percent between July and September; and 22 percent did so to give in October or later.

"The Toys‟R"Us bankruptcy has brought an incremental sales opportunity to the toy industry, and with at least a month to go until i t wraps up, there is still more to come," said Juli Lennett, senior vice president and toys industry advisor, The NPD Group. "Shopping behavior since the announcement indicates that consumers are not pantry loading on Christmas gifts. I estimate that, of the 22 percent planning to give in October or later, about half of that is for birthdays or other occasions and the remaining for Christmas, resulting in a net impact on future Christmas sales of less than 1 percent."

In the opening 10 weeks of 2018 as well as the four weeks surrounding Easter and the Toys‟R"Us news, among the fastest-growing supercategories during both periods were Youth E lectronics, led by Fingerlings; Dolls, driven by L.O.L. Surprise!; and All Other Toys, on account of sales increases for Soft N Slo Squishies, Smooshy Mushy, and Squish-Dee-Lish. In the latter weeks leading up to Easter, Plush sales moved into these ranks as traditional plush typically sells well for this holiday.

Many items that moved into the top 20 best-sellers for the latter four weeks were spring and Easter friendly, including Bunch O Balloons 3pk, Glove A Bubble Assortment, and Hatchimals Mini Eggs CollEGGtibles 12 pack.

"Given the timing of both these events, I believe it's likely that some consumers took advantage of the Toys‟R"Us deals by purchasing Easter gifts at the retailer," said Lennett. "Looking ahead towards the holiday season, from what the data shows and what consumers are saying so far, fourth quarter sales should be only slightly impacted by the liquidation."    

Source: The NPD Group/ Retail Tracking Service, 10 weeks ending March 10, 2018 and 4 weeks ending April 7, 2018

About The NPD Group, Inc.
NPD is the leading global provider of market information and business solutions covering brick-and-mortar, e-commerce, and emerging channels in more than 20 industries. We combine our unique data assets with analytic solutions to help our clients measure performance, predict trends, and improve results, advising them to help drive successful growth. Practice areas include apparel, appliances, automotive, beauty, books, consumer electronics, e-commerce, entertainment, fashion accessories, food consumption, foodservice, footwear, home, juvenile products, mobile, office supplies, retail, sports, technology, toys, travel retail, games, and watches / jewelry. For more information, visit npd.com and npdgroupblog.com. Follow us on Twitter: @npdgroup @npd_entertain

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