Electricals disrupt the toys and games market

Electrical toys are set to grow 28.5% over the next five years to be worth £589m in 2022. Year-on-year growth will accelerate in 2020 as millennials start to have families and embrace modern technology in toys & games, according to GlobalData, a leading data and analytics company.

The growth in electrical toys is partially driven by rapid innovation. For instance new robot releases are frequent and incorporate new technology such as artificial intelligence (AI) and voice control which is only now possible to integrate within household toys. For example Sphero’s new Star Wars BB8 droid allows users to develop their own augmented reality images that the droid can interact with through the consumer’s smart phone or tablet, for £130.00.

Fiona Paton, Retail Analyst at GlobalData comments: “Toy manufacturers are increasingly using electrical toys to move children away from tablets and smart phones by merging the physical and digital world. For example, The Furby Connect allows children to embed their physical Furby toy into an app to learn and develop the Furby’s personality– justifying to children that physical toys are still relevant for play.”

However, this could spell trouble for retailers as manufacturers reach children through apps – cutting out the retailer. Manufacturers can also accrue additional spend by offering extras such as new levels or capabilities.

Paton continues: “Electrical toys also have wide appeal to different age brackets, from Fisher Price’s Code-a-pillar aimed at toddlers to LEGO’s Mindstorm robot range and drones such as the AirHogs Star Wars Millennium Falcon Quadcopter which are designed with adults in mind – capitalising on the growing toys for adults market.”

As baby boomers and generation X start becoming grandparents and millennials start families, we will see acceleration in electrical toys growth. Millennials have been exposed to technology from a young age and will seek modern electronic toys for their children. Millennials are also famously time pressured, with both parents often returning to work after having children, so toys that can be played independently will be popular.

Paton adds: “At the same time, a desire for mindfulness and wellness will drive growth in traditional toys as parents encourage ‘wholesome’ play with their children. Additionally, grandparents will continue to gift grandchildren more heritage toys like classic board games, wooden toys and art toys.”