The Japanese toy market: good forecasts in a tough economy | Key4Communications |

More than 8 months have passed since Japan was struck by an earthquake and tsunami of unprecedented strength, with a high toll of casualties, including many kids, but the country has not returned to normal life yet.

The Japanese economy is experiencing an average drop of 7-8%. People are very cautious in spending their money, save for necessary purchases.

However, even under such tough market conditions, the toy industry is not faring so bad: just before the holiday season, almost the same sales results as in 2010 are expected.

Effects of the Thailand floods
One cause of worry is the flooding in Thailand. In fact, two major Japanese toy companies, Takara Tomy and Bandai, both have huge production facilities in Thailand. As to Tomy, it is feared that its factory will not be operative until next year due to the flood, and this could affect the overall toy sales in the Christmas period because some very popular items, such as the Tomica and Plarail playset lines (model cars and trains), which represent an important share of the boys toys segment, are manufactured there.

Should it miss these Tomy products, the Japanese toy market would turn out to be quite flat at the end of 2011. Only the Bandai action figures based on anime characters are emerging at the moment as a big success, showing great promise for the Christmas season.

Results in 2010
In 2010, the toy market in Japan reached a value of 669.9 billion Yen, with an increase of 3.5% over the previous year. This figure includes the leading toy categories (games, card games, jigsaw puzzles, trendy-high tech toys, boys toys, boys character toys, boys toys, girls toys, soft toys, seasonal toys, infant and pre-school toys) but excludes videogames.

The last 4 years the Japanese toy market has constantly grown. Since the Autumn of 2008, when the financial crisis started having heavy effects, and especially after the Lehman Brothers crash, all industries in Japan entered a difficult phase; business has been tough due to the bad economic conditions. The toy industry, people say, must be special since it is still doing well notwithstanding the recession.

Product trends
In 2010, the most successful categories were boys character toys, boys toys and card games. Boys character toys, after growing 29,5% in 2009, were up again 5.8% last year, thanks to hit characters like Kamen Rider 000 and Metal Fight Bei Braid. The most significant growth, 12% compared with 2009, was registered by boys toys, with Tomica and Plarail by Tomy as best selling lines.

Trading card games have become a very important category, in particular thanks to the contribution of characters such as Battle Spirits and Vin Guard.

In the girls toys segment, the most active lines were linked to hit animation characters, Super Doll Rika-Chan and HeartCatch PreCure! The well known Tamagotchi registered an 8.2% growth.

Building sets were strong in 2010 thanks to the efforts from Lego, Mega Bloks and Nanoblock. Reaching the adult consumers too, jigsaw puzzles and the hit character brand One Piece contributed to widening the market size. The summer in 2010 was very hot and sales were high for toy fireworks, while those of water toys increased.