Flat year for US market

Retail sales in the US market increased slightly (up 0.34%) and generated over $22.3 billion in 2006 compared to $22.2 billion generated in 2005, according to new figures released by NPD
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Besides the first quarter of the 2006 calendar year (Jan-March), which experienced a three per cent decline in total sales due in part to a shift in timing of the Easter holiday, the remainder of the year saw quarterly sales increases of two percent, one percent and one percent, respectively. At $10.6 billion in sales, the fourth quarter generated the largest amount of the industry’s revenue.

The strong performance of four super-categories helped the industry experience positive sales growth over 2005. Sales in Youth Electronics increased 22 percent over 2005, the largest increase of all super-categories. Vehicles, Arts & Crafts, and Infant/Preschool were the other strong performers in 2006, showing respective dollars sales increases of five per cent, four per cent and two per cent over 2005. Combined, they comprised over $9 billion in retail sales.

"In 2006 we identified a number of indicators which pointed to future growth for the toy industry. I'm pleased we're seeing these growth indicators beginning to reflect in the retail sales figures and we look forward to watching this progress in 2007,” said Anita Frazier, NPD industry analyst.

Action Figures, which performed strongly in 2005 due to the huge success of Star Wars products, experienced the largest decline in dollar sales in 2006, dropping by nine percent and generating close to $1.25 billion.

According to Frazier, the Action Figure super-category can expect to see increases in 2007 because of the release of major action movies.

"As a rule of thumb, licensed product will comprise approximately 25 percent of total toy sales in any given year," she said. "With movie releases such as Transformers, Spider-Man 3, and Fantastic Four: Rise of the Silver Surfer, the action figure super-category should realize gains in 2007.”

Retail channel performance revealed continued share growth at Mass Merchant/Discount in 2006, representing 55 percent of total sales, with Toy Stores representing 18 percent, the second largest channel in terms of traditional toy sales. Online, Food/Drug and Department/Major Chains represented six percent, five percent and four percent of 2006 channel sales, respectively. Online toy sales were up 12 per cent versus 2005.

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Tough times for US market

It seems the US market is having an even tougher time than the UK, with stateside sales  dropping nearly four per cent to just over $21.3 billion in 2005 compared to the prior year, according to NPD.

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UK trade sees five per cent growth

End of year figures from NPD show that the UK market experienced healthy growth of five per cent during 2006 although, despite strong product, Christmas sales failed to increase on last year.

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Analysts see US recovery

Data from NPD points to the US toy market experiencing something of a revitalisation, with analysts also pointing to a number of other encouraging signs.

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