I mentioned last week that it was a challenge to write the Blog having only had a few hours to reflect on the London Toy Fair. By the same yardstick, this week’s Blog is an even bigger challenge, as I am slap bang in the middle of my trip to Nuremberg, and every hour brings new developments and fresh food for thought.
My task is made even more complicated by the fact that there are contradictory signs and mixed messages everywhere you look. Reading the runes has rarely been trickier.
Take the 2018 US toy market performance, for example: under the circumstances, a 2% decline – normally a cause for concern – is surely a decent result. Some foretold a catastrophe of epic proportions after the demise of Toys R Us – I suspect those people would have gladly settled for this outcome from the outset.
Indeed, the prevailing mood remains positive and upbeat, and I have seen many great new products and some exceptionally strong extensions to existing ranges. Yet the first conversation I had yesterday morning revolved around a wave of redundancies sweeping through the toy and licensing communities. Are they reactive or pre-emptive? Or are they simply part of the natural evolution of individual companies or the overall business? Are they driven by uncertainty, necessity or essential forward planning strategy?
It is never nice to hear of large numbers of people losing their jobs (such as 30% of the Disney European operation) or individuals who I like and respect moving on (Universal’s Jonathan Baker). And the changes are by no means confined to the licensing community- I’ve heard of impending cuts at several significant toy companies, which only add to the air of uncertainty.
And yet…the vast majority of my meetings here in Nuremberg – as in Hong Kong and London – have been positive and productive. Change is not in itself necessarily a bad thing: maybe the developments at certain licensing companies will result in a more efficient operation without unnecessary layers – one which is easier for suppliers and retailers to work with? Maybe, in time, certain licensors will even re-evaluate the increasingly bizarre embargo situation that sees a draconian lockdown on movies featuring characters we already know? It’s good that ‘they’ rescinded the original edict not to have anything at all on show at Toy Fairs – I’m not sure that would have gone down well with anyone.
On a similar but related note, I do wonder about the logic of having a closed stand and a stack of NDAs on reception and then putting a picture of the stand on Instagram or Twitter – curiously self-defeating. Mind you, it isn’t always deliberate: one senior toy figure posted a picture on LinkedIn, only to realise that a ‘secret’ product sat proudly in the background – necessitating a repost with a hastily cropped shot. 21st century business problems at their finest!
Another development which will be interesting to follow is the rumoured evolution of the Argos catalogue: my sources suggest less toy pages and a reduction of the density of product on each page. If true, I guess it is likely that assortments will be reduced, but SKU efficiency should improve (providing the team selects the right product). I have questioned before whether the pages had perhaps become too busy with too many small images, so while some suppliers will have concerns about a potential reduction in their line count, it could still work to their advantage in the long term.
Ultimately, attending a global event like Nuremberg Toy Fair – and being surrounded by people from every corner of the globe – makes you realise that there is more which unites us than divides us. We all share many of the same challenges and many of the same opportunities. We’re all doing our best to make sense of the changing face of the toy world, and there are few better places to do that than in Nuremberg.
At dinner with Spielwarenmesse CEO Ernst Kick last night, he told me that the international share of attendance over the first two days reached 70%. The share will reduce by the end of the show, as the weekend will see a far higher number of domestic visitors. Nevertheless, that figure represents the highest ever share of international visitors for the first two days in the show’s history. Seventy years after opening its doors, the Nuremberg Toy Fair continues to evolve with the times, just as the best toy companies are doing.
With all the snow in the UK, I just hope we can get home tonight, or the international attendance figure over the weekend might just exceed the organisers’ expectations.