Toymakers have their fingers crossed that parents are going to be more willing to splurge on toys for their kids this year.
According to a CNBC article, this trend was recently spotted at the 109th American International Toy Fair in New York.
According to market research, toy sales in the U.S. declined during 2011 to $21.18 billion, a 2 percent dip from 2010. Yet despite these numbers, experts insist American consumers may be willing to loosen their purse strings and spend more this year.
What does it all mean?
It’s go-time for retailers. Although it’s only February, toy sellers must place their orders for the holiday shopping season.
Here’s the key: The toy industry is very price sensitive. It’s also driven by kids’ preferences.
Of course, this makes it more difficult for retailers who have to guess now — 10 months before boys and girls will unwrap Santa’s spoils — what toy will be hottest. They need to ensure they order enough for the holiday season. If retailers buy the wrong toy, it won’t sell and everybody loses.
And from the looks of the research, this means toymakers have to be even better at the guessing game. Researchers say Americans are making trade-offs; they’re probably going to buy one expensive toy instead of buying several cheaper ones.
According to CNBC, this trend is called “Save and Splurge.”
Source: CNBC, February 2012