Kids Insights – The direct approach: Will 2021 be the year for direct to consumer selling?

In its latest report in which it outlines the consumer trends among children aged three to 18 set to shape the coming year, market intelligence agency, Kids Insights predicts a stark rise in direct to consumer retail. With social media and brand’s own platforms playing such an integral role in marketing – as well as the coronavirus fuelling online spending – what are the long-term implications of this rising trend?

It’s a point of interest to explore that, in the year brought to a standstill by the on-set of the coronavirus pandemic, a large proportion of businesses within the toy space became busier than ever. Only, with its traditional methods turned on their head, many were forced to adopt new methods of doing business within the altered landscape of consumerism.

A great accelerator of the inevitable, it’s becoming increasingly apparent that the marks left by Covid-19 will go on to shape a new future of commerce for many years to come, and as brands become increasingly aware of this shift, so too will their processes of placing themselves in the homes of the consumer.

One of these modes has been felt through the uptick in brands’ direct to consumer activity. More and more, toy brands are re-positioning themselves not just as commodities; items to be purchased with the aim of filling in 30 minutes of a day, but as resources, platforms, and trusted experts in their respective fields – indispensable places of knowledge, product, and play. All of a sudden, brands that have previously done so much of their talking ‘on-shelf’ are bringing those conversations into their audience’s homes. And then selling directly to them.

The Insights People, a global leader in kids, tweens, and teens market intelligence is one to have noticed such a trend. Specialising in research and insights on kids aged three to 18 and their ecosystems, the group surveys more than 5,000 children every week, across five continents, and 13 countries, gathering insight from more than 227,000 children a year.

Having recently issued its annual Kids Insights Future Forecast report, the group unveiled its ten predictions for 2021, among which is the ‘significant growth in direct-to-consumer or over-the-top retail. The report’s predicted trends are based upon the attitudes, behaviours, and consumption patterns of kids, tweens, and teens, looking at their lives both on and offline.

Here, the Insights People exclusively explores the report’s prediction as the retail scene comes to terms with consumerism’s new playing field.

“Kids Insights data has shown the number of children (3-18) spending money online has grown by 50% since the start of the year.”

 

The significant growth of Direct to Consumer selling

Even at the start of this year, and before the widespread of Covid-19, The Insights People 2020 Industry Report identified that more than half of businesses predicted that their D2C revenue would increase significantly on 2019. 

And like many other trends, Covid-19 has accelerated this trend with an increasing number of brands looking to reconsider and redevelop their approach. 

We can see from our data, that this generation of children are increasingly financially empowered and enabled in their online attitudes and behaviours. In the UK, the number of six to 18 year olds spending money online has grown by 29 per cent year-on-year and targeted financial products like GoHenry are making it much easier for kids to shop digitally and independently. 

In the last three months alone, a quarter of six to nine year olds in the UK have spent money using a debit card or a PayPal account, an increase of 32 per cent year-on-year. 

It’s becoming ever more apparent, therefore,  that there has never been greater potential –  and need –  for brands to sell directly to their customers.

“One- in-10 tweens now own their own financial products such as GoHenry.”

 

Targeting the toy audience 

2020 has seen a number of brands increase their focus and investment in developing their D2C offerings. In the toy industry, both Hasbro and Mattel have expanded their D2C operations in order to meet the growing demand for e-commerce. 

For these brands, the ability to sell direct to their customers increases the opportunity for them to increase advocacy between them and their target audience, be it through better customer service, a more immersive and personalised shopping experience, or encouraging interaction with the brand across alternate digital touchpoints such as their accounts on social media platforms.

D2C also makes it more possible for smaller, independent brands to reach an audience; cutting out traditional marketing middlemen, and communicating directly with their audience via social media platforms. 

Children are increasingly perceptive to messages within these platforms and we have recently seen a 10 per cent increase in social media being the location of UK teens’ favourite adverts, nearing that of TV. Platforms such as Instagram have implemented integrated shopping solutions in app and in the UK, tweens on average dedicate more than £5 month to in-experience spending.

As the Coronavirus pandemic continues to cause significant disruption to bricks and mortar retail, we expect that one of the headline trends for 2021 will be the continued, accelerated growth of D2C retail across all aspects of the kids ecosystem. 

This generation of kids favour experiences that prioritise personalisation and co-creation, factors which D2C can facilitate. Brands will become more agile, more authentic and produce more personalised products en masse, through advancing technologies such as Augmented Reality and 3D printing.

The annual Kids Insights Future Forecast report, which makes 10 predictions based on its extensive experience of the kids’ ecosystem, and is available to download at www.kidsinsights.com/toynews

About Robert Hutchins

Robert Hutchins is the editor of ToyNews and its sister title, Licensing.biz. He has worked his way from Staff Writer to Editor across the two titles, having spent almost eight years with both and what now seems like a lifetime surrounded by toys. You can contact him by emailing robert.hutchins@biz-media.co.uk or calling him on 0203 143 8780 You can even follow him on Twitter @RobGHutchins if ranting is your thing...

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