Brands and Value Perception Trump Price in Purchase Decisions
The Economy and Its Influence on Toys; Fourth and Final
Installment in a Series Exploring the 4E's of 2009 Toy
As seen at Toy Fair 2009, toy makers have responded en masse to the
soft economy by serving up oodles of merchandise in the $25 and under
retail range. Hasbro introduced a wide assortment of new products that
sell for $10 or less, 80% of all Bandai America products retail for
under $25; Wild Planet Entertainment only introduced items under $25 at
mass retail, something CEO Danny Grossman is adamant about.
"Being in 'the fun business' now comes with a heightened sense of
duty and obligation,” Grossman says. “While it's necessary
for families to cut back on spending, that doesn't mean kids need to cut
back on playtime.”
Although price is of obvious importance to cash-strapped parents,
results of the 2009 Brand Keys Customer Loyalty Engagement Index
indicate that consumers are not buying based on price alone. Instead,
they are relying more on their perception of value when deciding which
brands to stay loyal to during the recession.
Consumer expectations regarding brand value went up 20 percent,
according to the survey. Those brands that aren't perceived as being
“worth it” will fall to the wayside, said Brand Keys
president Robert Passikoff.
The survey polled 26,000 consumers of 441 brands in 63 categories
earlier this year, providing examples the toy industry can learn from.
The brands that received the highest marks met or exceeded consumer
“There is a price-value formula consumers use to calculate
brand differences and to decide which brands to buy,” said
Passikoff. “Shopper consciousness has shifted from just trying to
ferret out deals to looking for brands that provide value.”
A bright spot which has emerged in spite of a weakened economy is the
toys for pets category, which seems to be recession resistant. In 2009,
the American Pet Products Association (APPA) estimates that Americans
will spend an approximate $45.4 billion on their pets - a $2.2 billion
increase from 2008.
A number of TIA members have entered this category including Warner
Bros. (under the Scooby Doo brand), Play Visions and JAKKS Pacific,
which holds licenses for the American Kennel Club (AKC), Cat Fanciers
Association and Animal Planet and also produces the Totally My Pet
Reyne Rice, TIA Toy Trend Specialist explains: “Pet products
are designed to promote active play and interaction between pets and
their owners, which is in alignment with the youth toy market
Pure product innovation will also continue to lure consumers into
stores even in tough times if the perceived brand value is present. Such
is the case with I Can Do That Games, a three -year old company which
has brought a fresh perspective to the preschool game category. The
company' originative play model blends active engagement with classic
board game moves, encourages cooperation and includes skill-level
options - a bonus to parents. Furthermore, all are priced under $20 at
"We launched the company in 2007 with the Dr. Seuss license and an
exclusive retail partnership with Toys “R” Us,”
explains Jacobe Chrisman, president. “Since then we have built out
our retail channel to include full mass and specialty distribution. To
date, same store sales are up 20% year over year."
In uncertain economic times, consumers and retailers gravitate toward
tried and true brands that they know and trust. Companies and brands
looking to succeed in this competitive marketplace need to communicate
why their product is beneficial to consumers. Those who are able to do
that at an affordable price point continue to be ahead of the curve.