WASHINGTON, D.C. – On the eve of Christmas, the U.S. Census Bureau reported that 2020 has been a boom year for U.S. and international toy manufacturers.
The reason for that sales spike, all observers agree, is “COVID-19 guilt.”
In a report released Dec. 23, based on data from its Annual Business Survey, Census analysts said that total holiday season sales of hobby items, toys and games under Christmas trees in America would total about $17.4 billion in 2020.
Many private market researchers generally concur with that estimate, including the international NPD Group.
After seeing overall toy and game sales decline by 2 percent and 4 percent in 2018 and 2019 respectively, NPD’s latest market analysis predicts that U.S. toy sales will end this year up by nearly 20 percent.
Sales of toys and related items were basically flat for the first three months of 2020, until the coronavirus outbreak occurred. Then children found themselves isolated from their social circles when schools were closed and sports and other group activities were cancelled.
A recent nationwide survey by the Harris Poll found that nearly one-third of adults with children confessed to feeling guilty heading into the holiday season that their families had suffered from the impact of social isolation during the pandemic.
When parents were sent home from their jobs due to COVID-19 concerns, many occupied themselves with do-it-yourself projects and other home improvements. That impulse resulted in gigantic revenue gains for retailers like Lowe’s and Home Depot.
While parents worked on projects, their children played with new toys and gizmos, resulting in a continuing windfall for industry giants. The trading value of Mattel stock has increased by more than half since March, while Hasbro reported stock market gains of 30 percent in the same period.
Retailers have found that parents continued to assuage their feelings of guilt with increased levels of spending on toys, hobby items and games throughout the holiday season.
The international toy market has been in upheaval since 2018, when Toys ‘R’ Us – the world’s largest retail toy chain – went belly up. Although other manufacturers have since been scrambling to fulfill market demand, that process was further complicated this year by the supply chain disruptions caused by the coronavirus outbreak.
The U.S. sales boom for the holiday season will likely benefit foreign manufacturers as well as American firms, according to industry analysts.
The Census Bureau reports that the United States imported foreign-made toys, games and sports equipment to the tune of $4.3 billion in 2020.
With branches in 30 countries throughout the world, the NPD Group provides data, industry expertise and prescriptive analysis to its international business clients.