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By Richa Naidu, Aishwarya Venugopal
LONDON (Reuters) -Santa Claus may not have as much to give this year because hard up shoppers in Europe and the United States are prioritizing food and household staples, global toy makers and industry experts said.
Consumers worldwide have struggled to cope with high inflation and sluggish economic growth. The holiday season, which begins with Black Friday at the end of November and lasts roughly until the end of December, is expected to be especially tough for retailers selling discretionary items, executives say.
Favourites such as Barbie dolls, Transformers action figures and Hot Wheels cars will still be at the top of children's wish list, said Loo Wee Teck, consumer electronics industry manager at Euromonitor International.
But many parents can't afford them this year, according to executives. The top selling Barbie doll on Amazon, "Barbie Pop Reveal", currently costs parents 19.99 pounds ($24.89). Meanwhile, Hot Wheels' Scorpion play set was 35 pounds in 2020, according to parent blogs, but the same toy is about 60 pounds on Amazon.co.uk this year.
"The most important thing for people this holiday is to have food on the table for their families," Isaac Larian, CEO of Bratz doll maker MGA Entertainment, said in an interview.
Toymakers Hasbro and Mattel have already warned of weaker industry sales. But trading could prove even tougher than expected, executives at four toymakers and experts told Reuters.
Larian is expecting holiday sales at his company, which also makes Little Tikes toys and sells products across Europe and the United States, to decline by 10-12% worldwide versus last year.
Demand in the lead up to Christmas will be "smaller" than last year, said Nic Aldridge, managing director at Bandai, the maker of Tamagotchi virtual pets.
Aldridge anticipates more price cuts as retailers look to shift older products.
"The was an abundance of supply from previous years so there is a lot of clearance stock and a lot of deep discounting," he said.
BLACK FRIDAY OFFERS CLUES
Global sales of action figures like Transformers and Spiderman are projected to decline by 2% this year, Euromonitor
forecasts.
Anticipating the lower demand and already holding surplus inventory, many retailers ordered in less product than usual this year. That means products that are in demand may sell out quickly. Black Friday will give retailers an early indication.
"We are seeing some early Black Friday sales start just now," Barbie maker Mattel's president and chief commercial officer, Steve Totzke, told Reuters on Monday.