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Christmas’ season: no risk, no reward

Emili Alsina, Director, Ediciones Just

  • Key4Communications

Industry professionals expect with caution the development of the Christmas’ season that will shape the outcome of the overall sales of the business. The fact that consumers delay purchases is no longer a trend, but evidence. Thus, consumption is concentrated in the last week of December and first of January. S triking is the fact that the toy industry makes discounts during their peak sales season, which is the Christmas season, a strategy of questionable impact on the business.

Moreover, it seems that this year there will be a lack of products during the Christmas’ season in different categories of toys and beyond the star items. This would generate a loss of business opportunities and unmet the demand, both of which the toy industry should not permit in its most important sales period. No risk, no reward.

The professionals from the toy industry expect that sales during the Christmas’ season will determine the outcome of the business at the end of the year. In the last issue of our magazine Express Juguetes B2B #56, we published a Barometer of the toy sector, which was elaborated from the professional’s (manufacturers, buying groups, specialized retailers, associations and experts) opinion.

Below we sum up some of the main factors that will determine this Christmas’ campaign:

- Consumers wait until the very last minute to start shopping for Christmas. The Christmas campaign focuses mainly on the last week of December and the first week of January - for the Spanish celebration of Reyes. This causes that retailers have to replenish stocks at very short notice. The first week of January 2013 represented 13.3% of the annual total sells, according to NPD. This high seasonality of the sector (which is around 60%) pushes retailers to carry out very aggressive offers and discounts.

- Parents tend to buy the kids' favourite present, which is normally the star gift of the year, thus there are less sells in complementary accessories and gifts. Although the educational value is taken into account, the desire of the child is the most fundamental factor in the parent’s choice.

- The categories that are likely to have a higher percentage of sales will be Construction sets, with Lego leading the ranking; Action toys, which are popular thanks to the good performance of licenses for children; as well as Artistic toys, usually items which  entertain and enhance kids’ imagination and creativity.

- According to Maria Costa, director of Child Research at AIJU, "there will be an increase of technological items sales at Christmas. The 'App toys' are considered the future of the sector. These toys interact with tablets or smartphones without losing the physical part of the game. "

- For girls, licenses such as Peppa Pig, Frozen, Violetta and Doctora Juguetes will be the most popular, while for boys will be of greatest impact licenses such as Minions, Ninja Turtles, Star Wars and Spiderman.

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