Toy market in Japan - statistics & facts
Japan’s toy market hit the trillion Japanese yen mark for the first time in 2023, despite the challenges it faces from a shrinking population of young consumers. The industry draws inspiration from media trends, technological innovations, and popular culture to draw in children and adults with analog and high-tech leisure goods. As birth rates and the number of young people are declining in Japan, manufacturers and brand developers are looking towards grown-ups with interests that are commonly associated with children (kidults) like collecting trading card games, which has become a pillar of the toy market.
The sales strategy revolves around limited releases and blind boxes. Sales periods of limited products can range from a season to as short as a few days, with the low numbers resulting in a race among collectors and high-resale prices in the second-hand toy segment. Blind boxes are randomized items that include a piece of a set. Similar to collectibles from capsule toy vending machines, they are retailed at lower prices to encourage several purchases to complete a set. As Japan’s child population is projected to decline, mature fan bases will remain in toy manufacturers’ focus. A selling aspect will be nostalgia, as fans of major franchises from the 90s have now grown into adults.
Toy businesses and media franchises
The toy industry is controlled by domestic businesses that either collaborate with brand owners or are brand developers themselves. The close relationship with media franchises in the gaming, TV, and film, as well as publishing industries blurs the lines between toy segments and character merchandise, making it difficult to determine a clear leader. Video game developers like Nintendo have a significant presence in the console gaming market, with their merchandising units and subsidiaries developing goods based on their intellectual property. Tomy Company is a major example of a successful children’s toy-focused manufacturer that acquired the merchandising rights for popular external IPs like Pokémon and Disney. Bandai, the toy and hobby-related subsidiary of Bandai Namco Holdings, is one of the largest multinational manufacturers that targets children and adults with long-running toy series and popular modern franchises.Pop culture and the business model of “collecting them all”
Popular culture is the driver of toy sales in Japan and creates the most influential submarket. Modern toys have a large variation in designs and are influenced by media trends or the culture of cuteness (kawaii). They are available at specialty retailers and time-limited pop-up stores, with their lifecycles tied to serializations in the manga industry or current media releases. Adolescents and kidults in the otaku subculture, who create collections and are willing to spend several ten thousand yen on fan goods, are key target groups.The sales strategy revolves around limited releases and blind boxes. Sales periods of limited products can range from a season to as short as a few days, with the low numbers resulting in a race among collectors and high-resale prices in the second-hand toy segment. Blind boxes are randomized items that include a piece of a set. Similar to collectibles from capsule toy vending machines, they are retailed at lower prices to encourage several purchases to complete a set. As Japan’s child population is projected to decline, mature fan bases will remain in toy manufacturers’ focus. A selling aspect will be nostalgia, as fans of major franchises from the 90s have now grown into adults.
