Sales of toys and games enjoyed a strong revival in 2020 and 2021, as most of the world was embroiled in COVID-19 lockdowns.
As consumers were mainly home-bound, with nowhere to go, there was stronger demand for both video games and traditional toys and games, with consumers looking for activities to combat boredom when stores, restaurants and other activities outside the home were closed.
The launch of the new generation of gaming consoles (Xbox and PlayStation) in 2021 also sparked a frenzy for static consoles, leading to a 17% increase in sales. Nintendo Switch, while not equipped with graphic prowess, also registered record sales amongst casual gamers.
The love of toys is expected to continue in 2022 and beyond, even as most markets transition into the “new normal”.
Traditional toys and games still growing in an ever-increasing digital world
As many consumers become more digitally entrenched, sales of video games will receive a boost over the forecast period.
While gaming will continue to be popular in Western Europe, growth in video games will pale in comparison with North America and Asia Pacific, as Europeans seek a balance between video games and traditional toys and games.
Sales of traditional toys and games will grow over the forecast period, despite declining birth rates, as consumers turn to traditional toys as an escape from the digital world.
Kidults (adults buying toys for themselves) will drive sales of both video games and traditional toys and games. Singletons and households with no children enjoy higher disposable incomes, which would otherwise have been spent on children, allowing younger adults to indulge in hobbies such as collecting action figures.
Spending on video games to surge in Asia Pacific over the forecast period
Sales of hardware such as static consoles skyrocketed in 2021, as new generation consoles including the PlayStation and Xbox were launched. Pent-up demand is expected to continue in 2022 due to component shortages limiting supply. Sales of AR/VR headsets also received a boost as interest in the metaverse drove demand.
Nonetheless, it is mobile games that will dominate sales of video games over the forecast period. While the majority of mobile games are free to play, casual gamers are tempted to pay for in-app purchases in order to level up or gain an edge over other mobile gamers.
Asia Pacific will overtake the US as the largest gaming market, with China’s vast population behind the growth of video games over the forecast period. South Korean and Japanese gamers continue to spend the most in per household terms, solidifying their status as gaming nations.
For further insight, see World Market for Toys and Games.