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The Toy Economy – it’s not all fun and games

toy economy

 

It’s hard to miss the latest toy trend: fidget spinners. Just three propellers whirling around one central point, this toy is shockingly simple, and even more shocking has been its rapid rise to popularity among children of all ages.

How the fidget spinner gained celebrity via YouTube channels and other social media shares demonstrates just how much the toy and game economy has changed – and the implications for families looking to budget and save are major.

The evolution of the toy economy

Many parents reminisce about the ‘good old days’ of spending time outdoors, making up games and playing with uncomplicated toys. These fond memories of childhood are probably even more prevalent when mum and dad check out of Toys’R’Us with a pricey electronic toy or game under their arms.

The toy economy has evolved. Not only have the types of toys on the market changed dramatically, but also how they’re marketed. The fidget spinner, for example, first emerged in 1997, but it wasn’t until two decades later that these basic devices gained a massive market foothold thanks to shares on YouTube and Instagram.

According to Josh Loerzel, Vice President of toy manufacturer Zing, fidget spinners are “the biggest toy I’ve seen in at least 10 years, and it’s been a total free-for all. It’s not a big-bucks driven, premeditated thing. It blew up the opposite way.” Zing expects to sell 4 to 5 million spinners this year.

What Loerzel means when he refers to “big-bucks driven” toy trends is the vast majority of what else is on the market – more expensive, electronic products.

Roy Morgan Research shows that more than half (53 per cent) of all Australian children aged 6 to 13 owned a computer in 2013, up from 33 per cent in 2012. More often, kids have access to tablets – with 57 per cent of 10-13 year olds and 49 per cent of 6-9 year olds owning or using a tablet in 2013.

For many families, the tablet has replaced the toy, with parents buying apps to keep their kids occupied rather than visiting bricks and mortar establishments to purchase toys and games. Although apps may be cheap, the upfront costs of a mobile device or tablet are not. In Australia, a new iPad starts at $469.

How the toy economy affects a family’s budget

Unfortunately for families trying to live on a budget, the fidget spinner – which generally retails for less than $10 – is an anomaly.

When planning your family budget, be sure to account for toys and entertainment. When planning your family budget, be sure to account for toys and entertainment.

Finder research shows some interesting trends that reflect how the children’s toy, game and entertainment industry directly affects the cost of raising a child.

  • The average costs of infancy: $16,000
  • The average costs of early childhood to primary school age: $82,000
  • The average costs of high school: $131,300

Why the higher cost associated with older children? Finder cites increased entertainment costs, technology and communication (including mobile phones and internet access) as primary reasons for the increase.

Parents then, need to be particularly careful and consider the age of their children – as well as their children’s hobbies and preferences – when planning a family budget. Teaching children financial responsibility is also critical. If your son or daughter wants that new video game, for example, explain to them the importance of budgeting and saving, and ask them to perform household tasks in order to buy the product on their own.

At Bank of Queensland, we want to be with your family every step of the way and we offer a range of personal banking services that can help a family out at all stages of life. We even offer bonus interest savings accounts for kids because it’s never too early (or too late) to save.

This blog post is for general information purposes only and is not intended as financial or professional advice. It has not been prepared with reference to the financial circumstances of any particular person or business and should not be relied on as such. You should seek your own independent financial, legal and taxation advice before making any decision about any action in relation to the material in this article.

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