Of the many changes to sweep across the toy industry at the hands of the pandemic, one of the most noticeable shifts is across the collectables landscape. Once a sector that carried the industry to success not one year ago, it’s fair to say that the coronavirus has given the market a bit of a shake-up.
Here, Kids Industries strategy director, Jelena Stosic, a marketing expert who has worked with the likes of Star Wars, PJ Masks, Warrior Cats, BBC Worldwide, and Playmobil, and a regular guest lecturer at the University of Vienna, dissects the category and asses what it needs to do to regain the foothold it once had.
Previously one of the darlings of the toy industry alongside the construction (read LEGO) category, the sales of collectables have taken a bit of a pandemic pummelling.
Back in 2018, The NPD Group explained that, ‘despite a lower price tag, collectables represent a significant slice of the UK toy market, both by volume and value. [They] have been a main stay of the toy market for years, but recently the category has been rebooted by manufacturers adding creative new elements to meet the demands of today’s savvy young toy collectors.
Sales of collectibles increased by 29 per cent in the first eight months of 2018 alone and by 156 per cent since the same period in 2015. Key to success are unboxing, surprise, exclusivity, and a good sprinkling of social media shareability.’
That was then, but this is now and now tells a very different story with NPD describing collectables last year as one of the “losers” of lockdown. Sales dropped 29 per cent between Jan – May 2020 compared to the same period in 2019 and there are two main reasons for this.
One is to do with the nature of the lockdown during which we’ve witnessed audiences looking for toys that would deliver extended play value rather than short-term delight such as building sets (sales of which rose 17 per cent). In addition, we’ve seen a rise of inter-generational play, a narrative that’s supported by the sharp rise in sales of board games (up 43 per cent) and outdoor doors (31 per cent) both of which parents can enjoy with their children.
“I think it’s fair to say that the range and nature of marketing strategies we see from collectables brands this year will be diverse and depend on a huge number of factors.”
The second dynamic is what I like to call the ‘revenge of the parent’. At Kids Industries, our research shows that parents have a bit of a love-hate relationship with collectables. The most successful examples are trend-led and often plastic heavy and, as such, whilst there are exceptions to the norm, these toys tend to be something parents don’t always relish buying in the way they would a LEGO set, which provides a warm glow and the promise of imaginative play.
Collectables tend to be requested by children, can be impulse purchases and certainly thrive alongside playground chatter. With home schooling, those conversations have been quashed, playing with friends removed from the equation, and a visit to the shops turned into a mission requiring long queues and masking up, which means the sales of products so strongly led by child-request suffered.
If we factor in financial challenges, as well, which is forcing us to make more careful purchases, the next 12 months could prove tough and success will rely very much on a combination of product development, distribution and marketing strategies.
How to survive lockdown and come out the other side fighting
Several big players are responding well to the challenges. Hatchimals and LOL Surprise, for example, have launched more expensive products suited for longer-term play in addition to their collectable lines; the L.O.L. Surprise! Car-Pool Coupe vehicle and Hatchimals’ Crystal Flyers are great examples. Over the last few years – but more noticeable recently – brands have been investing more in content strategy to secure additional engagement.
I think it’s fair to say that the range and nature of marketing strategies we see from collectibles brands this year will be diverse and depend on a huge number of factors. There are several key areas that KI will be focusing on with our clients:
- Play value: A key part of product development, but also essential in comms strategies. With no lockdown end date in sight, and with increasing financial constraints, are there opportunities to serve the audience more meaningfully? For some, this may include creating products that serve longer-term or educational play patterns, or developing unique, stand-out play features. For others, it may mean focusing on the development of a play system: can you sell accessory packs or vehicles, can your collectibles come together in a way which makes them meaningful parts of the same whole? The question of how we can maximise play value is, or should be, the priority.
- Parents. Always the important decision makers, and even more so in recent times. If children can’t request as efficiently as they normally would, will they resort back to toys and brands they are already fans of? What are the others to do? Can you strengthen your parent comms and offer them value, too?
- Content. This could range from video content, to games, to books, but there’s no denying the fact that good content supports the development of that fandom that will make your brand in demand. After all, humans – and this includes children – love stories. At the same time, it’s incredibly difficult to set up and maintain a strong content strategy. In all likelihood your first pieces of content will need a high marketing spend, and then – if you’re lucky and the audience keeps requesting it – the content production can become increasingly expensive leading to brands wondering if it’s worth it. There’s no single right solution to this challenge but, in our operations, we’re exploring different ways to create content from lean production schedules to partnerships and would develop different approaches for different types of brands at different moments in their fandom life cycle.
In the short to medium term, we expect the market to continue facing challenges for all the reasons already outlined: children at home and with diminished opportunities to play with their friends, parents rushing through shops and perhaps struggling financially. In this climate, the big brands tend to be the most resilient, alongside the few that fit a cultural trend or are set up to be agile.
As the strategy director at Kids Industries, Jelena Stosic merges market and audience insight with client objectives to produce exciting and engaging campaigns.