Toys, whether we’re talking about wooden kitchen toys or traditional ones, are essential to a child’s development. They promote creativity and thinking, and encourage children to explore. Unfortunately, many of the world’s children do not have access to commercial toys, or cannot afford to buy toys, leaving toy manufacturers with a number of untapped markets. Yet the current focus of major toy companies is to continue to develop the dwindling North American audience. Last year’s total industry growth landed at about five percent. Hasbro recorded a decline in profit by about 11 percent in their last quarter, and Mattel’s revenue dropped 6 percent in 2013. There are some key theories as to why major toy companies have struggled: families are smaller, children are adopting technology sooner, and there are more distractions for children and the traditional figurine or play set is just not “entertaining” enough for today’s kids.
The end result for toy companies will depend on what new strategies will be implemented. Most of today’s toy companies are focusing their effort on building apps, video games, selling licences, and building interactive electronic toys. Market research has shown that children will spend more time on computers, mobile devices, and watching television or movies than they ever did before, which validates the focus and effort in this new direction.
But considering other markets might also be an effective strategy. The United States represents approximately 40 percent of the global toy market, and only has about two percent of the world’s children. For major toy companies, the international market consists of countries in Europe and parts of South America, with smaller markets in Australia and parts of Asia (mostly Japan).
Technology, global markets, and children have changed and will continue to change. Today’s biggest toy companies, who pay close attention to the aforementioned, will have their future success dictated by the strategies they implement today – the next few years will be key for today’s nine biggest toy companies.
A note: DCP (Disney Consumer Products) was left off this list. DCP records annual revenue of over $27 billion. Although DCP produces toys, a good portion of revenue is directly related to licensing brands to other toy companies.
So, without further ado, here’s a list of the biggest toy companies in the world: