Much as it pains me, I feel I have no choice but to start this week’s Blog off with some thoughts on the topic that is on everyone’s lips at the moment – price reductions in the toy aisles. One retailer sent me a message with a fairly blunt summary: “I’ve never seen anything like it in all my time in toys… it’s like a real-life Amazon marketplace out in the stores.”
I homed in on one particularly egregious example of selling below cost a few weeks ago in the Blog, but to be fair it’s now reached the point where it is pretty much going on across the board. I suspect much of this activity is ad hoc, rather than being meticulously planned: the nature of the in-store promotional material rather gives it away – not glossy and pre-printed, but hastily knocked up on the store photocopier using coral draw or some other ancient computer art program.
And the promotions aren’t limited to higher priced items, as you might think; there’s plenty of activity even at sub-£10 price points, sometimes featuring brands that are consistent sellers all year round. I saw one sign proudly proclaiming “10% off everything” – literally, nothing was off limits, so presumably that isn’t being funded by targeted supplier contributions.
I am secretly hoping that some of those people responsible for these price cuts find their way into the travel & tourism industry (have you seen the price of hotels recently?!), or perhaps flower/prosecco suppliers in time Valentines Day. We do seem to be something of an anomaly, in that the toy market cuts prices ahead of our peak period. I doubt we will ever see travel prices slashed in July and August. I worry that it sends a message out to consumers that toys are over-priced and don’t have intrinsic value, which I really don’t think is the case.
Of course, I am not sitting where buyers and store owners are sitting; I don’t know how much stock they are sitting on, or how the rate of sale compares to previous years. I’m not at the sharp end, speaking to customers every day, assessing what is going to make the difference between a sale and a walkout.
Our editorial team has been speaking to a wide selection of indie retailers in preparation for our bumper January issue this week, and the overwhelming consensus is that customers are being more careful and thoughtful with their purchases than ever. They’re looking for value, for toys that will be played with again and again – and in many cases, where they might have been considering £50+ items in previous years, it’s more the £30 price point that is the sweet spot this time round.
I guess that consumer finances are driving this behaviour. Despite newspaper headlines celebrating so-called tax giveaways by the Chancellor in this week’s autumn budget statement, most people aren’t stupid. They know that the freezing of tax allowances exceeds what they are being given back by the reduction of national insurance levels, and the increase in the fuel cap in January – announced the day after the budget statement – won’t have helped either. Yes, there are encouraging measures – including an increase in the living wage – but I think we have to accept that this year, some consumers will be adopting a more frugal approach to festive spending.
Next year will almost certainly be different, if only for the fact that the only way the incumbent government is likely to win the coming election is by offering even larger financial bribes to the electorate– we’ve seen this week that normal economic consensus goes out of the window when an election is looming.
There have been some bright spots amongst the price wars: queues built up outside many specialist retailers at dawn last Friday for the launch of Ravensburger’s Lorcana Series 2. I bet there weren’t any retailers cutting the price on that! This also neatly illustrates the importance of Kidults to the toy market: I know we all talk about it all the time now, but it’s times like this when you really see the power of the Kidult demographic in full swing. They’re passionate fans, they want what they want, and they have the money to buy it. I am sure those toy retailers that are fully embracing this group are reaping the rewards, and perhaps those that have yet to dip their toe in the water might be tempted to give it a go in the New Year.
So, let’s see what Black Friday brings – I haven’t noticed a huge amount of toy activity on Amazon so far, but maybe that will change this weekend. Another strong footfall weekend in physical stores would also be most welcome, as the window for placing final Christmas re-orders is getting very short indeed.
And for those (few) companies that haven’t yet booked their spot in our bumper January issue, now is the time to get in touch – we genuinely are getting down to our last remaining slots now. It’s going to be another belter, and the one magazine that everyone is going to be eager to get stuck into early in the New Year. Whatever happens between now and the end of the year, we all go back to zero on 1st January and start the process all over again. Everyone assembles at the same starting line, aiming to secure listings from buyers who also all have blank pages at the start of the year.
As we head into Thanksgiving weekend, I’d like to wish a happy holiday to all of our American readers. Entering into the spirit of the occasion, I am thankful to be working in the rather wonderful toy community and thankful that we play our part in it. We may not make or sell toys, but we do help to keep everyone in touch with what’s going on, with everything you need to know all in one place….and I think that’s no bad thing.