Many parents around the world have become very concerned with how little physical activity their children are getting nowadays.
In many developing countries, those like China and Mexico, this has in part been a result of a shift from rural to urban lifestyles, while in developed countries, a decline in sports participation has been a key driver of parental concern over how much exercise their children are getting.
Most importantly, in most countries, there has been alarming growth in the number of obese or overweight children, causing many parents to fear for the long-term health of their children.
Parents have turned to toys to get their children to exercise more.
Let’s get physical
Sales of physical development toys have been a growth category in most developed markets, although there were some declines following the onset of the global recession. Much of this growth has been due to outdoor and sports toys, as sales of ride-on vehicles have been flat or declining ever so slightly in most developed markets.
Outdoor and sports toys managed to record strong retail sales growth in 2014, increasing by four per cent globally in US dollar fixed exchange rates. This high growth rate made it one of the faster-growing categories in traditional toy and games, and came after three years of mostly low or even negative sales growth for outdoor and sports toy products. Positive sales came from nearly all regions although the driving forces behind outdoor and sports toy sales were markedly different between emerging and developed markets.
The vast majority of developed markets see much higher spending on outdoor and sports toys than on ride-on vehicles for physical development. Notable exceptions are Japan and South Korea. In many of these markets, the strong performance of outdoor and sports toys products is closely tied to concerns about declining sports participation and rising obesity levels.
Higher incomes in these markets allow for sales of high priced toys, such as trampolines. In addition, Nerf has a sizeable presence in many of these markets, which has helped to grow overall outdoor and sports toys aisles.
Compared with developed nations, developing countries are much more oriented to ride-on vehicle sales. This is due to lower spending on outdoor and sports toys, as outdoor and sports toys have a much bigger gap in spending between developed markets than other traditional toys and games.
Emerging markets are seeing strong growth in outdoor sports and toys for a variety of different reasons. Emerging markets that experienced large growth in their urban population, like China, which saw outdoor and sports toys grow by 22 per cent in US dollar fixed exchange rates in 2014, have seen a rise in parents who want to keep their children active.
In other markets that have high import costs, like Argentina, where outdoor sports and toys grew by 29 per cent in US dollar fixed exchange rates, growth stems from the fact that most outdoor and sports toys are cheap enough to be made locally and thus avoid import duties.
Finally, licensing has played a key role in emerging markets like India, which had strong growth in outdoor and sports toys due to licensing with Chhota Bheem, a popular license in the country.
Physical toys are expected to see very different areas of growth in the forecast period between developed and emerging markets. Developed markets will see value growth derive from outdoor and sports toys, as these products have become essential to parents in developed markets for keeping their children active, especially with declining sports participation
Adults affect developed markets
Developed markets also witnessed strong growth in outdoor and sports toys products, and the reason behind the growth was largely the result of young adults and parents.
Within the US, research studies announced by the Centers for Disease Control have shown that the percentage of children and adolescents who are obese more than doubled between 1980 and 2012, rising from seven per cent to 18 per cent.
This has had a major effect on parents, who now wish for their children to be more physically active, something that outdoor and sports toys help to facilitate and which was a key driving force behind the category’s nine per cent growth in 2014 in the US. In addition, Nerf has been a major factor in numerous developed markets, like the US, UK, and France, in the sales of outdoor and sports toy sales, and the brand’s success has helped to guide sales within the category.
The recent decline in sports participation in many developed countries has led some parents to purchase outdoor and sports toys, contributing to a gradual increase in sales. The category has been helped by the growth of Nerf products, with the brand seeing a significant increase in new product development by Hasbro. These developments include Nerf Rebelle, a new product aimed at girls, who have traditionally not been a significant target group for outdoor and sports toys.
A positive outlook
Outdoor and sports toys are expected to perform well globally from 2014 to 2019, growing by 15 per cent overall in US dollar constant value terms.
Again, the growth will come from numerous regions, most notably Asia Pacific, North America and Western Europe, as both emerging and developed markets are expected to make significant gains in the category.