The global toys and games market size was valued at USD 301.21 million in 2022 and is projected to reach USD 495.93 million by 2031, registering a CAGR of 4.8% during the projected period (2023–2031).
Toys and games include everything from rattles, dolls, and toy vehicles to skipping ropes, board games, and jigsaw puzzles, among other things. They have inherent worth that contributes to children's entire development. Toys aid in the expression of emotions and the development of creativity in youngsters. Games are also a great way to relax while improving cognitive, physical, and social skills. In recent years, the popularity of interactive and multi-functional toys and games has had a major impact on the toys and games industry.
The re-emergence of traditional toys and games is projected to bode well for market growth. Playing board games and puzzles has been proven to enhance brain functioning. These stimulate areas of the brain that are responsible for memory formation and complex thought processing. Engaging in card and board games assists in practicing essential cognitive skills, such as decision-making, high-level strategic thinking, and problem-solving. These benefits and more have been encouraging consumers to take up traditional games.
In addition, the industry boomed in early 2020 due to the global lockdown. In the U.K., the revenue from board games and jigsaw puzzles increased by 240% in the spring of 2020, and Monopoly was at the top of the list. According to Forbes, there was a significant rise in demand for indoor games like puzzles, board games, Play-Doh, etc., in April 2020. These games recorded 370% more sales as compared to the previous year in the U.S. Jigsaw puzzles led the way for the board games market in the country, with sales up by 228% for the week ending on March 21, 2020, compared to the same period the preceding year, according to the NPD Group.
Furthermore, many old-school board games also started trending in the past year. As per a blog post published by the University of Nebraska Omaha, several children and families in the U.S. played games such as Candy Land, Monopoly, Life, and Sorry in 2020. Many people bought these games during the pandemic, despite most already having them at home. Many families turned to games such as Scrabble, UNO, Guess Who, Yahtzee, Chess, and Checkers to teach their kids important life skills, especially with students missing school the past year. The growing popularity of traditional recreational activities among the younger generations and the rising preference of millennials for old-school games during social gatherings are expected to drive the demand for toys and games in the coming years.
Schools and parents are increasingly shifting toward green toys owing to health and safety concerns associated with using raw materials such as plastic in various toys and games. In order to leverage this opportunity, companies operating in the toys and games market are offering products made from green materials. Parents in industrialized nations like the U.S. and the U.K. are increasingly buying sustainable toys due to growing awareness about the health risks linked with plastic toys. Governments all over the world are also requiring businesses to produce a variety of items using recyclable materials to reduce their carbon footprint. The Toy Safety Directive (TSD; Directive 2009/48/E.C.) governs European toy safety. The TSD requires manufacturers, importers, and suppliers to ensure that their products adhere to the mechanical, physical, and chemical safety standards for toys.
In addition, a compliance assessment process is used for every toy to be sold. A toy maker must create an E.C. declaration of conformity before placing it on the market. By doing this, the maker attests to and accepts liability for the toy's compliance with the fundamental standards of the TSD. Such regulations oblige producers to create environmentally friendly goods, which is anticipated to increase the supply of green goods.
Furthermore, many small start-ups manufacture BPA- and phthalate-free products. More than 80% of parents in countries like the U.S. and the U.K. purchase eco-friendly toys. To cater to these growing demands, companies are focusing on geographic expansion. For instance, as of 2018, products offered by Green Toys Inc. are placed in over 5,000 shops across the U.S. The company also sells its products through online channels to cater to a larger audience, which is expected to increase product visibility over the forecast period.
Toys are a common target for counterfeiting, just like other consumer goods. The majority of fake goods are offered for sale online. In 2018, when the U.S. government's accountability officer ordered 47 toys, 20 were counterfeit. These 'test purchases' were done through 3rd party online sellers. E-commerce creates low hurdles for online sellers, making selling unverified goods easy. Lack of screening and late or no reporting of vendors selling counterfeit products are some factors driving the sales of counterfeit toys and games. In addition, toys are listed after cigarettes but before clothing in Europe, where they make up 14% of all customs seizures. Most nations consider counterfeiting a crime, and in Europe, it carries a three-year prison sentence and a 300,000-euro fine.
Additionally, most of these products are produced in China, as the European Commission reported that 80% of the counterfeit toys that were seized originated from Asia. These products are sold on well-known online platforms like Amazon and eBay. More than 50% of people think that if the products are listed on such popular sites, they are originals. Counterfeit toys are not just causing harm to brands and their revenue but can also be risky for children, as these products are cheaper and made without following quality regulations. Counterfeit toys use harmful materials such as lead paint and carcinogenic plastics. Such factors hinder market growth over the forecast period.
Major universities and scientific research institutes from across the globe emphasize the use of toys and games as tools for improving mental health. In January 2021, C-Toys Inc, a start-up toy company that aims to create mentally stimulating puzzles, toys, and games, launched a crowdfunding campaign on Indiegogo for its debut invention, an innovative and dynamic 3D puzzle called C-Maze. C-Maze is the first and only dynamic 3D maze puzzle, great for those stimulated by mentally challenging puzzles and games.
In addition, construction toys help develop children's imagination, creativity, and attentiveness. They also keep them engaged and improve their problem-solving skills, logical thinking, hand-eye coordination, and memory. Moreover, magnetic construction kits are very helpful for children as they are easier to connect than conventional products. Rapid R&D, in terms of innovation for the launch of new toys, is projected to create growth opportunities for the global market.
The global toy and games market is segmented based on product, application, and distribution channels.
Based on product, the global market is categorized into puzzles, preschool toys, outdoor and sports, dolls, video games, and others.
The puzzles segment is the highest contributor to the market and is predicted to exhibit a CAGR of 3.4% during the forecast period. The introduction of numerous cutting-edge and distinctive puzzles has also been essential to the segment's success. Theory11 and Star Wars released the 'The Mandalorian' playing cards in January 2021. The premium deck has unique illustrations of show characters such as Mando, Baby Yoda, IG-11, Moff Gideon, Cara Dune on the Aces, Jokers, and court cards. The packaging is one of a kind, shrouded in Beskar silver foil, space black, and striking red foil, and features a sculpted 3D embossed Mandalorian helmet. The illustrations are hand-drawn and printed on FSC-certified paper created from sustainable forests, with vegetable-based inks and starch-based laminates.
Based on application, the global market is segmented into up to 8 years, 9 - 15 years, and 15 years and above.
The 15 years and above segment dominates the global market and is estimated to exhibit a CAGR of 2.8% during the forecast period. The development of the "kidult" category in the toys and games market is the key factor driving this market segment. According to ToyNews Media, this adult and teen segment currently accounts for 27% of all toy sales in the U.K. as of 2020, up 16% from 2016. Kidults finished complicated building set kits, played more games, and passed the extra time by solving puzzles in 2020. In addition, the average sales price of toys increased due to this group's tendency to purchase more expensive toys. Millennials, who make up more than half of the kidult market, view toys and characters from their youth as a way to escape reality and serve as a reminder of more innocent times. The players have been planning how to dominate and take advantage of this market sector to appeal to the kidult market directly.
Based on distribution channels, the global market is segmented into online and offline.
The offline segment owns the highest market share and is estimated to exhibit a CAGR of 4.6% during the forecast period. The offline segment includes retail stores such as department stores, chain stores, supermarkets, discount retailers, warehouse retailers, franchises, malls, shopping centers, mom-and-pop stores, dollar stores, and convenience retailers. Due to their extensive accessibility, these shops rank among the best places to buy toys and games. In the U.S., owing to favorable government regulations, many supermarkets and hypermarkets operate until midnight. This factor, coupled with greater product visibility and the availability of innovative educational games, has led to a surge in the sale of toys and games through these channels.
Region-wise, the global toys and games market is segmented as North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa.
Asia-Pacific is the most significant global toys games market shareholder and is expected to exhibit a CAGR of 4.2% over the forecast period. Asia-Pacific is one of the most lucrative toys and games markets, owing to the growing awareness of branded and licensed games and toys in the region. Moreover, the large regional population is the major factor for this market's growth. According to a U.N. study titled "World Population Prospects 2019," Asia's population will rise from 4,326 million to 4,654 million, excluding Western Asia, by 2030. These factors make the Asia-Pacific a lucrative potential market for toy and games manufacturers in the future.
In addition, traditional playing cards have evolved over the years in Asia-Pacific, and augmented reality has redesigned how consumers play games and learn new things. For instance, Sony offers its new interactive platform called "Project Field," which promises to change the way kids play card games and bring these childhood games to life. The gaming platform— only scheduled to release in Japan—uses Bluetooth and NFC technology to turn physical cards into digital ones.
North America is estimated to exhibit a CAGR of 4.5% over the forecast period. Americans collectively spend over USD 25 billion on toys and games yearly. From educational toys that make at-home learning fun to creative crafts and from traditional board games to innovative games, products the whole family can enjoy together are gaining demand across the globe because of stay–at–home orders. In addition, many movies with impending theatrical releases got stalled and were released on Amazon Prime, Netflix, and other OTT platforms. However, straight–to–streaming blockbuster releases were lucrative for toy companies. Compared to the 2019 statistics, toys based on movie characters witnessed a 19% increase in revenue in 2020, whereas non-movie characters showed a single-digit increase.
With over 95 million subscribers, the Disney+ platform has been releasing films such as "Soul" and "Raya and the Last Dragon" days before their release, themed toys hitting the shelves because of the immense popular demand. In addition, teenagers spend much of their free time bonding with family or friends over social media by playing games, including innovative board games, Xbox, and even ones available on the gaming deck on Facebook.
Europe is predicted to experience the greatest global toy and games market growth. Improving economic conditions and changing consumer preferences reshape Europe's toys and games market. The region's shift toward more technologically advanced and expensive toys and games is evident. New product releases and licenses are the key drivers contributing to consumer preferences and transforming the functionality to serve children's education and skills development.
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