NPD: U.S. Toy Industry Grows its Sales by 7 Percent in the First Half of 2018

The following article is based on a press release issued by The NPD Group on August 6, 2018.

August 6, 2018 | The U.S. toy industry grew its dollar sales by 7 percent to $7.9 billion in the first half of 2018, according to global information company The NPD Group.* Over these six months, which included the beginning and end of the Toys“R”Us liquidation, there were a number of catalysts for growth.

“It is likely that the Toys“R”Us news has kept toys top-of-mind for parents and grandparents when shopping for kids in general, benefiting both consumers and the industry,” Juli Lennett, NPD’s senior vice president and industry advisor of toys, said in the press release. “I am also convinced that the strong toy industry growth so far this year has been at least partially supported by the empathy that people felt towards losing a store like Toys“R”Us. I think it brought about an emotional response that resulted in parents buying more toys overall.”

The strongest growth driver in the first half came from toys priced $5 to $19.99, and this was led by L.O.L Surprise!, Total Marvel, Fingerlings, Hatchimals, and Soft N Slo Squishes. The influence of these toy properties is also clear when looking at the toy industry’s performance by supercategory. 

For the first half of the year, NPD reported sales increases in the following categories: Action Figures & Accessories (+16 percent), Arts & Crafts (+7 percent), Dolls (+17 percent), Infant/Toddler/Preschool (+6 percent), Youth Electronics (+43 percent), Outdoor & Sports Toys (+5 percent), Vehicles (+8 percent), and All Other Toys (+12 percent). Three categories were flat or saw declines: Building Sets (0 percent), Games/Puzzles (-3 percent), and Plush (-4 percent).

Youth Electronics was the fastest growing supercategory driven by Fingerlings, Star Wars, and Tamagotchi. Sales in Dolls were led by L.OL. Surprise!, Hatchimals, and Barbie. The Action Figures and Accessories supercategory was lifted by the movie release of Black Panther in February, Avengers Infinity War in April, and Jurassic World: Fallen Kingdom at the end of June.

Dinosaur and pony/unicorn themed toys grew by 77 percent year-to-date through June, and NPD expects these themes to be trending this holiday season. Driving the dinosaur trend has primarily been Jurassic World, as well as Fingerlings and other dinosaur-related products.

“The toy retail space has been bustling with activity, and this will continue through the end of 2018,” said Lennett. “Existing toy retailers have announced they will be dedicating more space and will carry more toys this holiday season both in-store and online. We’re also seeing new store formats emerge that are more experiential, and we will have new toy retailers entering the space. The industry has shown to be proactive in compensating for the dollars Toys“R”Us has left on the table, and more.”

In a separate statement, Toy Association President & CEO Steve Pasierb said: “Even with the closing of Toys“R”Us, toy companies, retailers, and consumers sent a clear message that the sky is not falling in the toy industry. With an active first-half movie season driving licensed properties, strong performance in youth electronics, dolls, and surging interest in dinosaur and unicorn toys combined with retailers mobilizing to win market share, the proof is in the results. These multiple positive movements bode well for the upcoming holiday season.”

*Source: The NPD Group/ Retail Tracking Service, January-June 2018. Data is representative of retailers that participate in The NPD Group's Retail Tracking Service. NPD’s current estimate is that the Retail Tracking Service represents approximately 78 percent of the U.S. retail market for Toys.