Editor's note: This article appeared in the December 20, 2010, edition of Quirk's e-newsletter.
Most adults who've had the pleasure of reviewing a child's holiday wish-list have likely noticed that the days of simply asking for a dollhouse or Matchbox car set are long, long gone. It isn't that children are asking for more - though maybe they are - it's that their lists are growing evermore specific. Susie wants a pink-and-white Brand X dollhouse with 12 rooms (and the car, please) while Tommy wants a 24-car carrying case with the blue Corvette model (if it isn't too much trouble). Kids today know exactly what they're looking for and will wait patiently or beg shamelessly to get it.
According to the Toy Purchase Decisions report from Port Washington, N.Y., research company The NPD Group, the majority of toy purchases are planned (62 percent), with buyers setting out knowing what toy and/or where they were going to purchase. More than three-quarters of buyers who made a planned purchase said they knew specifically where they wanted to shop.
Instead of browsing toy shops or paging through the Toys "R" Us catalog, these toy shoppers are on a mission and will accept no substitutes. In terms of toy availability within a retail store, 42 percent of toy purchasers looking for a specific toy said they would look for that toy in a different store, and 9 percent would look online to purchase it if the toy they were looking for was not available. Only 22 percent of buyers claim they would look for a different product in the same store.
"The fact that there is less substitution of another item if the original item isn't found is a real wake-up call for retailers," says Anita Frazier, industry analyst, The NPD Group. "Picking the right product selection and then managing the inventory to keep those items in stock is more important than ever before."
On the flip side, however, toy purchasers are not immune to impulse buys. Thirty-eight percent of toy purchases were not planned, with 70 percent of those unplanned purchases coming from on-the-spot impulse decisions made by the toy buyer. The remaining 30 percent were made because either the buyer was coerced into the purchase by a child (21 percent) or they remembered they needed to buy a toy after they were already in the store (9 percent). And while a child's request for a toy is a key driver for unplanned purchases, pricing is the primary motivator to purchase.
Overall, planned purchases result in higher price points than unplanned purchases (average price of planned purchases is 1.5 times higher than unplanned). Some of this may be driven by the types of categories that buyers look for during planned purchases. For example, categories with the highest price points, building sets and youth electronics, are two of the categories most likely to be planned. "Planned purchases are more important to overall toy sales than ever before," says Frazier. "For manufacturers, this means that generating direct-to-consumer awareness through advertising, promotion and PR is critical to driving items on to wish-lists and influencing the 'nag factor.'
"Of all unplanned purchases, 91 percent are truly purchased on impulse. ... Pricing is utmost in the decision to make an impulse purchase with the child nag factor being the second most important influencer."