Look, we know it’s not even Halloween yet. But as store displays nationwide will indicate, it’s never too early to plan for holiday shopping. And the winners and losers of the season may already be set.
Expect to see drones everywhere. Shipments of drones are up 250 percent over last year in the third quarter so far, according to exclusive shipping data compiled for Reuters by research firm Panjiva. Toys R Us is the primary seller, with nearly half of the all imported drones landing in its chain stores.
“This time last year, it was all hoverboards. And where are they now? Drones are where it is at this year,” says Panjiva research analyst Chris Rogers.
Lego could be one of the big losers this year, with shipments down 8 percent for the third quarter, and down 21.5 percent for September.
That dip, caused primarily by supply chain issues within the company, is dragging down the whole sector. Toy shipments are down 3.4 percent overall for the quarter, because the popular brick toys account for so much of the toy volume.
The bankruptcy of Hanjin, the South Korean shipping giant, also hurt toy sales, but not as much as other factors since Hanjin only disrupted 7.8 percent of all trans-Pacific shipments to the U.S. More damaging was American retailers' reluctance to place their bets this year. "The magic word is delays," Rogers said.
Peak shipping from Asia to the U.S. for holiday wares usually happens from July to October, he said. These are the items that will end up stocking the shelves of major retailers on Black Friday and beyond. The winners will have supply exceed demand, and thus maintain their targeted pricing. The losers will be overstocked and go on discount.
Besides drones, other hot toys for 2017 include Ben 10 toys, with shipments up 2 percent for the third quarter so far. “It’s not huge, but when you look at toy imports generally, it’s good,” Rogers said.
Another bright spot? American Girl doll products, up 360 percent in the third quarter. Rogers is also bullish on video games, especially those with virtual reality.
Star Wars-related toys are suffering the most this holiday season, down 42 percent in the third quarter. Rogers attributes this to the timing of the release of the next movie installment, “Rogue One: A Star Wars Story,” which comes out Dec 16.
“There’s a good chance a lot of stuff is coming in late,” he said. Or, perhaps, “Last year was a bit of a boom. It was the first Star Wars movie in 10 years, and this is, eh, another one.”
The Star Wars dip also is part of what is dragging down Lego’s numbers, because there are so many cross-promoted products. Given that Lego is perennially popular and will likely be a hot item once parents start shopping in earnest, Rogers has this bit of advice: “If you’ve got your eyes on any Lego, get it sooner rather than later.”