Toy sales in the United States have been on the decline but bad times might just be nearing the end. According to The NDP Group, toy sales increased 3% to $3.69 billion in the third quarter, much to the relief of ailing toymakers.
Toy sales in the United States have been on the decline for the past several quarters but the sudden surge is an indication that the market is likely to rebound. The turn around of sales is more likely given that the all-important holiday season has always seen a surge in the toy business. And this year too is likely to witness huge toy sales between Thanksgiving Day and Christmas.
Although toy sales have declined 5.5% on a year to date, the industry is likely to get a boost in the fourth quarter owing to the last-minute rush for buying gifts. The US toy industry generated US$21.6 billion in sales in fiscal 2018, a 2% decline compared to 2017. However, that was also largely because of the absence of the iconic US toy brand Toys R Us.
Moreover, there are six fewer days between Thanksgiving Day and Christmas this year, which is also making retailers push for sales well ahead of the holiday season. The last time a similar thing happened was in 2013.
However, in spite of six fewer days that year, toy sales picked up in the last week of the holiday season, particularly during Christmas, registering a growth of a whopping $280 billion.
Retailers to cash in on the absence of Toys R Us
Holiday season, particularly Christmas, is typically known to boost toy sales every year. This will be the second holiday season without the iconic Toys R Us, which went bankrupt in early 2018. Toys R Us accounted for 10% to 15% of total toy sales annually prior to its closure.
The NPD Group also anticipates continued growth in the fourth quarter of 2019 due to weakness in 2018′s fourth quarter following the liquidation of Toys "R" Us locations in the United States.
Starting fourth quarter, NDP expects toy sales to grow, aided by a spike in sales of action figures and accessories, arts and crafts, building sets, outdoor and sports, games/puzzles and dolls categories.
Moreover, the day before Christmas is likely to boost sales like previous years. In 2017 and 2018 the additional day before Christmas added $200 million in sales to the week's total figures.