Last year it was BeyBlades and the year before it was Lego Bionicles, but this year the toys of the moment are not based on a fad or a playground craze. Instead, perhaps rather surprisingly, they are based on education, and they're selling so fast retailers are struggling to meet demand in the run-up to Christmas.
Leading the burgeoning education sector is the LeapPad Learning system from US toy firm LeapFrog. Since its arrival in the UK in 2000, the toy firm, which combines education and entertainment, has sold so well that traditional toy giants such as Fisher-Price and Lego have been forced to re-evaluate their products and place a greater emphasis on the use of technology.
Ben Green, vice-chairman of the British Association of Toy retailers (BATR) and commercial director at retailer Greens Toymaster, acknowledges that in the past 12 months there has been a boom in educational toys and interactive learning aids. He attributes this to the growing penetration of PCs in the home.
"The market to sell kids' computers has all but disappeared because so many homes now have PCs which cater for that market and much more," he explains. "Interactive learning platforms such as the LeapPad and others have filled the gap for the toy industry."
Teresa Ceballos, LeapFrog's vice-president of marketing for the UK, puts its success in the £2bn toy market down to "finally getting the message right for parents".
"Educational toys and learning aids are an easy and proactive way to help children get ahead. It's not surprising that these toys are so popular because parents want the best for their children and these toys are an easy and interactive way for them to achieve that," she says.
Ceballos admits that the LeapPad, priced £34.99, is not the cheapest toy on the market, but she claims that because there are numerous software packages and interactive books which can be used on the platform, it offers the best value to parents.
LeapFrog is the third-biggest toy company in the US and is keen to build on its success here. Having poached Ceballos from Heinz earlier this year, it is keen to raise its marketing profile in the UK and is preparing to launch further educational toys next year.
BATR's Green says it's not just LeapFrog that is benefiting from the interest from parents in learning-based toys; rather, the upsurge is now being felt by a number of companies beyond the educational specialists, including the likes of Fisher-Price, Hasbro and Granada, with its Engie Benjy product.
"Manufacturers are beginning to understand what consumers want, and electronic learning aids are now toys in their own right. The learning-aid market went through a tough time, but it has reacted to technology advancements and brands like LeapFrog and VTech are holding their own," says Green.
Bryan Ellis, chairman of the British Toy and Hobby Association, attributes the boom in educational toys to technology advancements. "The facilities available in these products add to children's experiences. The high-quality technology, now relatively cheap to produce, makes learning aids a very attractive toy to parents because the benefits are obvious."
The BATR produces a list of what it expects to be the ten Christmas bestsellers and not surprisingly a number of learning-based toys including LeapPad and Bionicles feature prominently on that list.
Christmas is the toy industry's biggest period, with 40% of retail sales coming in December. A mixture of general department stores and toy shops are cashing in on the seasonal period. John Lewis estimates that demand for toys has increased by 550% over the past fortnight.
Another toy retailer taking advantage of the popularity of education- and learning-based toys is the Early Learning Centre. Managing director Mike France is convinced that the explanation for the boom is simply that there hasn't been a craze this year.
"Educational toys are our main focus, so we're very pleased to see this renewed interest. The main reason educational toys are doing so well is because there is no must-have toy this Christmas," he says.
Green agrees with France and claims that compared with previous years, when one particular toy has been in millions of children's stockings across the UK, this year it will be much closer.
It's not for a lack of trying by the leading toy brands to create a fad of the year. Toy giants such as Hasbro and Mattel have all jumped on the retro bandwagon with the reformulation of a number of popular brands from yesteryear, including My Little Pony, The Incredible Hulk and He-Man.
One hugely successful retro toy tipped as an outside chance to be the bestselling Christmas toy is the Teenage Mutant Ninja Turtles range, mainly thanks to its lower price. Green says the action figures, which have been completely redesigned by Vivid Imaginations to coincide with the airing of a revamped TV series, have had the best impact of a new product this year.
"They have been completely re-engineered and it seems to have paid off. The line was launched in July and there are stock shortages already," he says.
France is not convinced. He calls the industry trend to keep launching retro toys "boring" and says the main reason for the success of the education sector is because toy consumers are fed up with these blasts from the past.
"None of the retro toys have broken through this year. I think the main reason for this is that consumers are bored by the slavish approach that toy companies continue to take to retro brands. They've talked it up for nine months and it hasn't worked," he says.
Figures from toy market research specialist NPD show that toys based on licences are the most popular in the UK market. Over the whole year, a quarter of all toys sold in the UK are based on licences such as Harry Potter and Power Rangers. NPD does not see this market dominance changing, suggesting that this year is just a blip for the industry's normal success with fads.
The key to this is that the bestselling toys are nearly always based on the latest films or TV series, and next year Hasbro, Mattel and Vivid Imaginations are planning a mixture of new toys and TV shows to support their fight against the threat of educational toys.
Following the recent furore over advertising to children and what should be allowed, some thought that toy companies would channel some of their marketing budget away from TV into other mediums and that the industry could suffer as a whole.
However, in the run-up to Christmas, the opposite has happened, according to the latest statistics from Nielsen Media Research. Adspend on TV from toys and games companies has increased by more than £8m between June 1 and November 23 compared with the same period last year. These firms spent £57.3m on TV this year, up from £49m last year.
LeapFrog's Ceballos says this is not surprising because "the big boys are still spending like crazy" but she does concede that marketers may need to change the focus of their advertising and target parents instead.
"It's better for us to tap into the parents because they are the ones to whom we can explain the benefits of our products. That way they feel they are doing the right thing for their children," she says.
Many feel it is wrong to connect the debate about the extent to which food advertisers should be allowed to market to children with the toy industry. Green says the latter "has been tarred with the same brush" and this is unfair.
"There is a massive difference between junk food and toy advertising. Excessive junk food is not good for a child's health, but toys and play are undoubtedly good for the child's development. We don't expect any restriction in advertising," he says.
So, without a slowdown in TV advertising and the toy industry growing by 5% this year, according to NPD, the outlook for the final week of the seasonal period and next year looks good.
The main challenge now facing the toy industry is balancing the slew of retro toy releases against the noticeable impact of the educational toys. They have taken the market by storm and for the moment at least, some of the more traditional toy brands are struggling to keep up.
Rank Toy Manufacturer
1 LeapPad LeapFrog
2 LeapPad Books LeapFrog
3 Baby Annabell Zapf Creation
4 Swan Lake Odette Mattell
5 BeyBlades RC Launcher Hasbro
6 Bop It Extreme Hasbro
7 BeyBlades Hasbro
8 VJ Starz Karaoke Kids Biz
9 Badge It Bandai
10 Swan Lake Carriage Mattell
Source: NPD, sales for November 2003
TV ADSPEND FOR TOY SECTOR
2003 2002 Growth Growth
(pounds) (pounds) (pounds) (%)
Toys and games 57,371,290 49,056,520 8,314,770 16.9
Games consoles 2,526,914 1,886,026 640,888 34.0
Toy stores 1,885,876 1,857,097 28,779 1.5
Source: Nielsen Media Research, June 1 to November 23