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Spielwarenmesse: The spirit of playing

  • News
  • March 31, 2016
  • Doris Evans
Spielwarenmesse: The spirit of playing

At the international Spielwarenmesse toy fair, more than 2,800 companies showcase what children all over the world will be playing in the near future. On average, over a million products, with around 75,000 new ones, are on display, spread over 18 halls. More than 70,000 visitors from 120 countries are taking part, amongst them a number from New Zealand.

Every year at the end of January or beginning of February the medieval town of Nuremberg in the southern part of Germany is bustling with boundless energy and business. Famous brands, innovative startups, buyers from large chains, independent retailers, exporters, manufacturers, media representatives and newcomers are flocking to the toy fair or ‘Spielwarenmesse’, as it is called in German.

The success story of the fair started in 1950 with 351 exhibitors and 4,321 buyers, including 600 from abroad, attending the event. During the sixties the toy fair grew rapidly and new buildings were added to the old fairground. In 1970 the trade show moved into a newly-built fair site in Nuremberg. The exhibiting area grew to 52,000 m² and product groups were arranged systematically. During the eighties and nineties the growth continued and in 1991, the number of exhibitors reached the 2,000 benchmark.

When appointed as new chief executive in 2002, Ernst Kick started to work on the internationalisation of the trade show through co-operations, holdings and subsidiaries.  “Our position is quite clear: we want to be number one and we want to keep number one,” says Kick, “Our policy is to be the best fair.”

 It’s always worth coming to Nuremberg, even if you have to travel more than 18,000 km. The entire toy industry meets in Nuremberg according to Kick. Of this year’s exhibitors, 15 came from Australia and three from New Zealand, while 427 Australians and 78 Kiwis came last year to visit the global fair. These numbers are on the rise.

“Demand was very high for this year’s event with a 37 percent increase in sales,” says Monique Surges, CEO of the New Zealand German Business Association, which represents the fair in Aotearoa.

One of the regular exhibitors in Nuremberg is Jennifer McIver, director of Wishbone Design, a design and manufacturing company for kids’ bikes and accessories, based in Wellington.

“I love coming to the Spielwarenmesse because the visitors are so international. You meet key buyers from all over the world in one place. This is especially valuable for us. Last year we had a lot of interest from Asia, particularly from Korea and China,” she says. Wishbone Design kicked off their business in Nuremberg back in 2008 with “a roaring success”.

McIver reckons the company’s presence is Nuremberg has become a key factor for the business. “Our international partners know that we will be at the fair, they can rely on it,” she says. This year retail buyers from four different countries were invited to her stand in Hall Two. Making appointments in advance helped not only to create a relaxed atmosphere, but also an environment where business could be successfully done. “It’s all about networking and doing your homework before you travel to an international fair,” says McIver. “German trade shows offer a very easy way to get into direct contact with buyers.”

Even old established toy giants such as Lego, Mattel, Hasbro and Bandai travel to Nuremberg to start their campaigns of new products. They also use the fair to introduce new market concepts as well as strengthen and improve existing business relationships.

"A trade fair is a living product. It is always the picture of the market and markets are changing constantly," says Ernst Kick. It reflects market conditions, depicts markets in a concentrated form, brings representatives from the supply and demand sides of the industry together and enhances business contacts.

Monique Surges, who has been in the trade fair business for more than 20 years, agrees: “International trade fairs in Germany are of great importance… The Spielwarenmesse in Nuremberg [is] one of the top events for the industry. In fact, it’s the only toy fair worth going to, because  its four times larger than the New York toy fair,” she says. “You also have to take into consideration that around 75 percent of all German decision makers attend only trade fairs that are held in their home country.” Add to this the international visitors and you have a very powerful platform.

Participating as an exhibitor for the first time at trade fairs can be tricky, especially at a big show such as the toy fair, which is usually “fully booked” and has several hundred potential exhibitors on the waiting list. Newcomers, however, are treated differently in Nuremberg. They are placed at the NEC, the new exhibitor centre, which is an excellent starting point.

“This is a very painless way to be introduced not only to the German but to the international market,” says Surges. Kick agrees: “I would always recommend to newcomers to take advantage of the NEC. It is an excellent opportunity to get instantly accustomed with the fair and receive useful hints from other newbies or advices from experienced exhibitors.”

“Go with confidence and optimism,” is Jennifer McIver’s tip for first timers in Nuremberg. ”New Zealand companies are extremely well received over there. Everybody is excited to find a new Kiwi brand, which is a good kickstart”.

According to London-based market research firm Euromonitor, the global toys market was set to exceed ‎€65 billion in 2014, with the Asia Pacific on the way to become the world’s largest traditional toys region by 2017. China is leading with double-digit growth as the world’s fastest growing traditional toys and games market. However, Western Europe is also continuing to grow, driven by the region’s largest three markets: the United Kingdom, France and Germany.

The UK toy market saw a 5.9 percent increase in sales in 2015, helping to keep it in the top spot as the largest toy market in Europe, according to data released by the British Toy and Hobby Association. Market research firm NPD Group sees the British toy industry now valued at £3.2 billion.

The toy industry in Germany is thriving as well and expects a sales growth of four percent to nearly €3 billion according to the Federal Association of the Toy Retail Trade (BVS) and the German Association of the Toy Industry (DVSI).

Amongst the engines of growth are licencing, educational and tech-based toys. Big players often create “special edition” lines based on the latest movies - think Star Wars and the tremendous success it offers to licensees. “Licensing has been a key driver of toys sales globally, particularly for traditional toys,” says a researcher from the Hong Kong Trade Development Council (HKTD).

There is also an increasing demand for toys that can develop brain power, creativity, coordination and the senses. Interlocking bricks like Lego, puzzles and construction sets which improve hand-eye coordination, patience, creativity and spatial skills continue to be highly sought-after; board and card games that develop skills such as turn-taking and decision-making remain popular as well.

Today's children are growing up faster than a generation before. Kids aged 12 or above turn to non-traditional playthings, which means tablets and apps for children are on the rise. This development is challenging toy manufacturers to create innovative toys that capture the interest of children.

Another challenge for toy manufacturers is the global changing retail landscape. Mergers and acquisitions have created huge corporates, and big box retailers such as Walmart or Target are taking away market share from specialty chains and traditional toy retailers. These giants are able to purchase large quantities of stock, allowing them to bargain with suppliers and secure more favourable prices and terms of trade.

Then there are the online competitors such as Amazon and Alibaba. According to NPD Group, which operates in 20 countries, online channels have shown significant growth and could potentially contribute to more than one-fifth of toy revenues. But bricks and mortar retailers are reading the signs of the time and investing increasingly in ecommerce operations.

Trends in the toy industry

“There is not one mega trend”, says Spielwarenmesse chief executive Ernst Kick. “Usually there are several trends which develop in parallel. Technical toys continue to play a major role as technological developments from other sectors quickly are applied to toys. ”

‘Train your Brain’, ‘Everyday Hero’ and ‘Design to Play’ were the three major topics of this year's Spielwarenmesse, chosen by an international trend committee.

Train your Brain promotes cognitive skills and mental fitness. Everyday Hero encourages children to follow their dreams, while Design to Play promotes a new approach to toys, in which they are regarded as objects of design, colour and shape.

However, old-fashioned wooden building blocks and educational toys are still very popular. The collectables market, for instance, has grown to become a significant portion of the toy industry. High spending power characterises these consumers, who show great interest in vinyl toys, model cars and action figures according to the HKTDC.

Questions retailers should ask themselves before exhibiting
Monique Surges, CEO of the New Zealand German Business Association, says that before committing to a presence at the Spielwarenmesse, retailers should first consider:
  • What can I achieve by participating?
  • Why do I have to be there?
  • Who will I meet?
  • What is my key target?
  • Who is my client?

This story originally appeared in NZRetail magazine issue 742 February / March 2016

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