What’s New
Toys R Us is looking to tap into the growing “Kidult” market this Christmas, as falling birth rates mean less children are buying toys.
The toy company’s Asia branch is looking to the Generation Z consumer to bolster sales.
Newsweek has reached out to a representative for Toys R Us Asia via email for comment.
Cheng Xin/Getty Images
Why It Matters
Birth rates are falling around the world, with rates in the U.S. having hit record lows this year.
Toys R Us Asia is independent of the U.S. toy retailer, and operates in 10 Asian markets; headquartered in Hong Kong, the company has locations in China, Japan, Malaysia, Hong Kong, Singapore, Taiwan, Thailand, Brunei, the Philippines and Macao. Of these 10 markets, eight have a birth rate of less than two, Leo Tsoi, the company’s chief executive, told the U.K. newspaper Financial Times in an interview.
This rate is below the average replacement rate of 2.1 children per family, which is needed for a stable population.
What We Know
“Falling birth rates is a big social phenomenon that we cannot reverse in the short term … so we are shifting focus for growth to come from Gen Z Kidults,” Tsoi, who has been with Toys R Us Asia for a little under two years, told the Financial Times.
Adult spending accounts for one-eighth of the company’s revenue, Tsoi told the newspaper, and sales are growing, particularly in China and Japan.
Toys R Us is targeting toys that are either trending, or tapping into cultural trends.
One example is the popular Hello Kitty toys. Though it was first founded in 1975, Hello Kitty toys are immensely popular among Gen Z — #HelloKitty has 3.4 million posts on TikTok, and 14.4 million on Instagram, the social-media haunts of Gen Z.
Hello Kitty toys are also most popular among female consumers. This is not a coincidence; Tsoi told the Financial Times that women are spending more on toys than men, and opt for accessories such as badges and key chains. Take the viral Gen Z ‘bag charm’ trend that was a hot topic in fashion circles this year, generating hundreds of thousands of posts on social media, and countless op eds in fashion magazines.
This pattern is a marked shift from toy spending among children, where, according to Tsoi, boys are more demanding, going through toys more quickly and damaging them, while girls have a longer attention span and will tend to play with one toy for longer.
What People Are Saying
Tsoi told the Financial Times: “The market might arguably be bigger than kids’ toys given that birth rates have been dropping very significantly in the past few years.”
What’s Next
The so-called ‘Kidult’ market may well continue to grow as Tsoi predicted; and it will be interesting to see if these consumer behaviors continue beyond Asia and reach the United States.
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