Kidadults – grownups who love to play games and collect toys – are driving growth in the toy … [+]
It was two weeks before Christmas and the toy world was worried. Toy sales were running below 2020 and 2021 levels, and retailers had more toys in stock than needed, leading to deep discounting.
Jefferies analyst Andrew Uerkwitz, in a note to investors, warned in mid-December that the sentiment around holiday toy sales was “terrible”, with store checks showing a sharp deceleration from previous years.
But in the final weeks of December it is starting to look like some toy makers have a reason to be of good cheer – the kidults could rescue Christmas.
Kidults – adults who like to buy, and play with, toys, are the now the biggest driver of growth in the industry, according to a report from consumer spending research firm The NPD Group that has received a lot of attention this week.
An Associated Press article cited NPD Group statistics showing that people ages 18 and older account for 14% of the U.S. toy industry sales, or $5.7 billion between September 2021 and September 2022. That segment grew 19% during that period, according to the NPD Group.
When sales to ages 12 and up are included in the category, according to the The NPD Group, the sales add up to $9 billion, according to reports by CNBC and Toy World Magazine, or about one-fourth of toy sales.
Kidults, according to NPD toy industry analyst Frederique Tutt in a blog post on December 19, like to buy and play with board games, construction sets, puzzles, and collectible action figures, all categories that are expected to do well this year. Kidadults also tend to be last minute shoppers, Tutt wrote, another reason why toy sellers shouldn’t be too worried about early December sales figures.
“The whole kidult category has taken off,” said Jim Silver, owner of the TTPM toy review site and TTPM Influencer Management, and a 39-year toy industry veteran,
“You look at all the collectible action figures, the Lego items that are meant for kidults, the board games that are meant for kidults – it has become such a big category of the business,” Silver said.
“Toy manufacturers love it. It’s incremental sales that have been found over the last few years,” he said.
TTPM this year hosted a People’s Play Awards online vote for the best toys of the year, and included a kidult category. Silver and TTPM have sponsored other toy votes in past years, but this is the first time consumers were asked to vote for best kidult toy.
The winner was the Lego Atari 2600, a $200-plus construction set that lets the buyer build a Lego replica of the original Atari game system. Other top vote-getters in the kidult category were the Lite Brite Wall Art Pop Wow Edition – a version of the kids’ light peg toy that lets adults created 1960s-themed pop art to display, and the Arcade1Up Infinity Game Table, which lets users play digital versions of classics like Scrabble and Monopoly, or do puzzles, on a coffee-table size board that sells for about $900.
Those kidult toys, along with Hasbro’s
The NPD Group defines the kidult category as toys bought for or by someone 12 years and older. But Eric Nyman, Hasbro President and Chief Operating Officer, agreed that the core drivers of the category are adults buying toys and collectibles for themselves.
Hasbro has been able to capture a healthy share of the kidult market with its Magic: The Gathering brand, a collectible trading card strategy game that is becoming a billion dollar brand for Hasbro.
It also has created its direct-to-consumer collectibles platform, Hasbro Pulse, and this year is using that platform to sell an item that is resonating with kidults – the “Selfie Series” of customizable action figures that lets buyers send in selfie portraits using the Hasbro Pulse app, and put their likeness on a Power Rangers, Star Wars, or other action figure.
The HasLab crowdfunding platform lets collectors request and help create dream toys.
Hasbro also has brought back the Starting Line up sports action figures that debuted in 1988.
“We are seeing the kidult, or fan-driven business being an area that has some momentum, which is good to see,” Nyman said. “Clearly there’s a desire for adults to reconnect with their youth and we’re seeing that in a really nice way,” he said.
“The interesting thing for kidult [purchases] is they’re not all necessarily high price points,” Nyman said. “It’s much more about that emotional connection connecting adults to their youth and brands that they love,” he said. “A pack of Magic cards is still under $5, and you can buy several products on the Pulse for under $20.”
Isaac Larian, founder and CEO of MGA Entertainment, has said he expects kidults to be the key growth driver this holiday season, not just for his company but for the industry as a whole.
MGA is tapping into nostalgia for its iconic Bratz and Little Tikes brands by selling mini, collectible versions of the toys that remind millennials of their childhoods.
Jim Silver of TTPM thinks there are other reasons besides kidulting for toy makers to be optimistic about this holiday season.
His People’s Play Awards showed there is a lot of interest in this year’s hot toys, with videos about the award winners viewed 1.4 million times and counting.
All of the top winners on the list are selling well, Silver said.
Silver also is predicting that this will be more of a last-minute Christmas, with everyone, not just kidults, buying toys in the final weeks of December, rather than stocking up early as they did in 2020 and 2021.
Toy makers who compare their sales to holiday 2020 and 2021, when toy sales surged, will be disappointed, Silver said, but they have to realize those years were anomalies.
“This Q4 is going to be significantly off of 2021,” Silver said. But “if you compare it to the last three non-pandemic years, most companies are ahead of 2019,” he said.
“I’ve had toy companies say to me ‘Oh fourth quarter looks like a disaster’. When I say ‘How do you compare to 2018, 2019?’ they say ‘We’re actually ahead 5%’.”
Silver says he’s learned during his 35-plus years studying the toy industry has been that holiday success or failure always comes down to the last two weeks before Christmas.
The pandemic years made manufacturers forget that rule, Silver said.
Stores saw a surge in toy sales starting a few weeks before Christmas, he said.
“This is normal Christmas again,” he said.
Source: https://www.forbes.com/sites/joanverdon/2022/12/24/will-kidults-save-the-toy-industry-this-christmas/