Toys have always been there . So , it is no surprise that archaeological remains from the Indus Valley civilization often include toys . But what of the toy market in India today ?

In its composition , the toy market in India is largely imported toys . Yet only a few international brands ( e . g . Mattel , Simba , LEGO ) are maintaining a local presence of any depth . The explanation we often get is the current size of the toy market . Quite a few toy industry veterans lament “ a cultural indifference ” to toys . Yet , in an earlier study we had estimated the size of the market potential to be US $ 2.3b .

So where ’ s the Gap ? We believe the answer lies , in part , with the poor experience at the point of retailing . In our market studies , we have never come across a parent or care-giver who has not expressed a desire to add to the toy basket of their kids .

With this in mind , we present below a customer perspective on the various “ points of toy retailing ” in India . To present a common framework for evaluation , we will rate against the ingredients of toy retailing .

• Visual Merchandizing : Presence of uncluttered visual merchandizing that makes the flow of consumer evaluation consistent across a group of products

• Assortment : Availability of products to cater to varied consumer choice

• Purchase Assistance : We have found Indian consumers to be very focussed on the learning benefit from a toy . However , it requires a trained staff to explain the nuances and to talk that language

Online Stores The new kids on the block come with a lot of promise . The wide

assortment , competitive pricing , comfort of purchasing from home , are well touted benefits . However we feel toys in India will remain a high involvement product . In summer 2012 , when the online megastore Flipkart announced its entry into the toys space , trade sources were excited . With time we have seen that fascination turn lukewarm . To be fair , dedicated online toy stores in India , like Yellow Giraffe , are making attempts to capture the recommendation style approach to selling . Overall , we believe the online route will no doubt contribute to growing the toy market in India .

Organized Retail Penetration of organized retailing is a low 8 % in India . When seen in the context of geographical spread , the absence is starker . But while organized retailing does a great job in improving the assortment of toys , it still struggles to get trained staff in place .

• Department Stores : In our retail audits we often found that when sales personnel were asked what a particular toy does , their response is to read from the description in the box . Highly uninspiring from a consumer standpoint ! It is not surprising that department stores ( e . g . Shoppers Stop , Landmark ) have been cutting down on the space allocated to toys .

• Toy Retailers : Hamleys captured the imagination of the Indian consumer with its large box format and international style visual merchandizing . Trade sources gush at the tremendous push-power Hamleys has . Attempts by local players to establish dedicated toy stores ( e . g . Beanstalk ) have also received a thumbs-up from consumers .

Traditional Retail

• Gifts Store : Traditionally , this is where Indians buy toys . These shops sold a wide variety of merchandize , from home decor to electronics . They also typically had shelves of toys stuffed in . There ’ s a little bit for everyone in these stores – so long as you didn ’ t have too many questions . It works brilliantly for the hurried shopper who wants to pick up something within a budget . In our consumer surveys we haven ’ t found a need to be seen as a thoughtful gift giver . The budget was the prime driver . If at all , it helped if the toy had lights and sound .

• Large Toy Store : This is a phenomena limited to the large metro cities like Delhi ,

Mumbai and Bangalore . Mostly these are stores of large importerdistributors . Over the years , these stores have built a loyal following . The assortment is what made these stores a magnet . But even still the product mostly sold itself .

In Conclusion No doubt , pricing is an important factor and a highly elastic one at that . But assuming that pricing will eventually be determined by market forces , the missing piece in toy retailing today is sophistication at the point of retailing . While being critical , I must also state that we are optimistic . Just as their peers in other Asian countries , we expect Indians to be aggressive toy purchasers , once the retailing ingredients are in place .

About the Author Richa Dikshit is the Founder of ToyTasting . Formerly an investment banker with Merrill Lynch , Richa is based out of Mumbai , India - where she stays with her two daughters and husband .

Evaluation of Various Points of Toys Retailing

Online Organized Retail Traditional Retail

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