Prediction: Toy industry sales will be up 1% plus in the second half of 2009

September 1, 2009

I predict that the toy industry is going to be up by at least 1% in the second half of the year. Here is why:

First, according to a Playthings.com article: “US toy sales slipped 2% in first half,” the toy industry generated $7.8 billion in sales from January 4, 2009 through July 4, 2009 while in generated $7.95 billion during the same period in 2008.”

When you consider that we had not yet entered the recession until the second half of 2008, this number could have been a lot worse. In sharp contrast, as the industry enters the second half of the year it is going up against some very weak prior year numbers. Do you recall how bad October and November were last year?

So, if the industry could manage to keep the decline to 2% against strong 2008 first half numbers it should be able to manage an increase against very weak second half 2008 sales.

Secondly, keep watching video games. They were off 12% in the first half of 2009 (off 28% last month). That’s in comparison to an 18% increase in video game sales during the 4^th quarter of last year.

I have contended that video game sales hurt the toy industry in 2008 more than the recession did. If I am right, a decline in video game sales will indicate a positive trend for traditional toy sales.

Is there a fly in the ointment? Yes, if toy retailers don’t have the inventory in place to meet the coming demand, we could see some very unhappy children and some pretty disappointed toy companies on Christmas morning.

Posted by Richard Gottlieb on September 1, 2009 | Comments (4)

August 2, 2011

In response to: Prediction: Toy industry sales will be up 1% plus in the second half of 2009
Amory commented:

You're a real deep thniekr. Thanks for sharing.

August 1, 2011

In response to: Prediction: Toy industry sales will be up 1% plus in the second half of 2009
Jeanette commented:

I love reading these airtcles because they're short but informative.

September 2, 2009

In response to: Prediction: Toy industry sales will be up 1% plus in the second half of 2009
Rod Hoffmann commented:

While the toy and video game industries race for dwindling market share and the attention of consumers, the on-line MMORPG and social networks are elbowing both in to the ditch. Toys once occupied the a child's play time. Today, that's just not so.

September 1, 2009

In response to: Prediction: Toy industry sales will be up 1% plus in the second half of 2009
Scott Traylor, 360KID commented:

If you look back on video games sales data over the past many years you notice a trend. When a new hardware platform is announced, sales don't begin to take off until enough new titles are available to drive hardware sales. Usually the financial lift in video game sales occurs almost a year after a new platform is announced. The flip side of this equation, as a hardware platform ages, sales of software titles begin to wane, indicating that video game users are starting to loose interest in a specific hardware platform. I think what we're seeing is a declining interest in the current hardware platforms available to gamers. One can argue that this is why where seeing the Nintendo DSi roll out now, to prevent platform erosion in the US and extend hardware and software sales for many more months to come. I agree with your hypothesis Richard, that the toy industry will see a lift in 2nd half 2009 sales as a result of declines in the video game space.