NEWS

NPD: What Toys R Us closing means for the UK toy industry

Published on: 4th July 2018

Toys R Us officially announced it was entering administration in the UK on 28th February 2018.

According to NPD’s Consumer Tracking data, in 2017 Toys R Us was still the No.2 toy retailer in the UK market. However, sales for Toys R Us had remained flat since 2009, while the total UK market had grown an average of 4% per year.

When Toys R Us announced it was entering administration back in February, it was widely understood that sales of remaining stock would follow. Luckily for the toy industry, liquidation sales don’t happen very often; still, they can have an impact on market performance throughout the course of the year, as consumers looking for a bargain tend to stock up for gifting throughout the course of the year.

The NPD Group, recognising that this trading period has potential to impact the rest of the year, conducted a consumer survey in the UK, to understand what impact Toys R Us’ liquidation had on consumers’ immediate purchasing patterns, as well as their intentions for the rest of 2018.

In total, customers who purchased at Toys R Us during the nine-week liquidation sale purchased five toys on average, and spent £100 each, with many offering testimonials of purchasing much more, while there was a significant uplift in consumers going to Toys R Us during that period, compared to the same period last year. This was especially true at the start, when there were more products available and more store open.

The survey also showed that the number of buyers that switched from another retailer to purchase a toy from Toys R U was 17%. This would impact other retailers’ sales at the time by an estimated -2% in value during this two-month period.

To read the full article in the July 2018 issue of Toy World Magazine, click here.

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