Millennials Rising
'Building Our Future’ folks on 'Generation Next’
By Richard Gottlieb -- Gifts and Dec, 2/1/2010 12:00:00 AM
[This is the third in a series of articles that analyzes the results of the Building Our Future Toy Conference organized by Richard Gottlieb’s USA Toy Experts in conjunction with Playthings in October 2009. The purpose of the conference was to explore the future of the toy industry and of play. It brought together 21 thought leaders from a variety of disciplines both inside and outside the toy industry to discuss a series of topics. The conversations were sometimes vigorous, sometimes funny and always interesting. The resulting articles serve to synthesize the participant’s thoughts so that we can get a clearer picture of the opportunities and risks ahead. In this month’s article, we take a look at the topics of consumers and the state of retail.]
The new consumer
The toy industry is faced with a rising generation of parents who have been raised with the Internet, cell phones, texting and social networking. They are called “Millennials,” “Generation Y,” “Generation Net” and even “Echo Boomers.” Whatever you call them, they are very different from the Baby Boom and Generation Xers who came before them.
They are described as less consumerist, more communitarian and team oriented then their parents or grandparents. They are frugal and not into “things.” What they do like are products that are functional and that are freighted with values with which they agree (think scooters and bikes). They are confident and feel empowered by the choices they make.
Millennials are into social networking, texting and in general are very comfortable with having a world of information and an infinite number of products available to them at their fingertips. What kinds of consumers will they be? That was the question that our attendees were asked to consider.
Attendees seemed both concerned and wary of this generation that didn’t particularly like to consume. Never-the-less they dug in and came up with some interesting predictions on what the future looks like for the toy industry vis- a-vis this rising generation:
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Millennials are not into frivolous products so “novelty toys” are going to be at risk.
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They are, however, very much into function so toys that do sell will need to demonstrate value, values and longevity.
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This generation trusts their peers so bloggers, social networks and friends will have a bigger impact on the choices that these shoppers make. As a result, look for a continuing downward trend in traditional forms of advertising.
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Millennials act on the values that Boomers and Gen Xers only espoused, so look for green products and packaging to become far more important.
This next generation is also going to have a big impact on retailing, which not coincidentally, was the next topic our conference members considered.
Retail in the 21st century
We asked our participants to consider this question: The specialty and non-specialty retail markets have suffered from store erosion over the last few years. There is no toy industry without retailers (at least for now) so what is the future of retailing? Here is what our participants had to say:
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Specialty retail is going to get stronger. Participants had a growing respect for a new generation of specialty toy store owners that are seen as “hard-nosed” and do not engage in “emotional buying.” They are technologically savvy and are therefore willing to ignore the established rules of the game (think sales reps) in order to embrace new ways of buying and selling (think the Internet). The recession hit these specialty retailers hard but those who survived are strong and growing. They are expanding the size of their stores and adding doors. They will be a force.
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Paradigms may shift as toymakers become confident enough to test existing retail relationships by engaging in direct commerce with consumers. Particular reference was made to Spin Master’s TV-advertised 800 numbers and Hasbro issuing a catalog.
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Brick-and-mortar retail is going to become far more experiential as merchants realize that they must offer services that simply cannot be found on the Internet. The result: a more hands-on experience for consumers who will get to “test drive” more toys in-store before buying them; and a resulting evolution of toy stores into social centers where people go to play, not just to shop.
I want to again thank all of our participants for their insights and predictions. I am going to continue my trip into the future of play by holding a Building Our Future Conference in Europe this month in conjunction with the Spielwarenmesse International Toy Fair Nuremberg. I’ll tell you all about it in a future article. Until then, keep your eyes on the future.
We would love your feedback!
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