Under Walmart’s Top Toys List, a War Is Brewing

Under Walmart's Top Toys List, a War Is Brewing

Christmas could come early this year as retailers cover an uncertain outlook with past sales events and an attempt to start buying gifts earlier and drive more sales in the final months of 2022.

That was evident on Tuesday (Aug. 30) when Walmart unveiled its list of the best toys of 2022 “to help families plan ahead and save on their wish lists this holiday season, with more toys for kids than ever before. children of all ages and a wide range of prices,” according to a press release.

Walmart is acutely aware that cash will be tight throughout the year, so getting consumers thinking about gift-giving season earlier than ever is a clear effort to get more of those dollars sooner.

“We know our customers shop early, and finding the lowest prices on toy gifts is a priority for many families this year,” said Laura Rush, Walmart US Electronics Senior Vice President, Toys and Seasonal in the release, while noting plans to help. customers begin their holiday shopping.

In the entertainment category to which toys belong, Walmart’s battle royale with Amazon takes on serious proportions. The PYMNTS report “The Battle for Consumer Retail Spend: Amazon Versus Walmart Q1 2022” notes that Amazon dominates “with almost five times the share of Walmart in the books, sporting goods, hobbies and music categories. Amazon’s ability to maintain its edge over Walmart in the books, sporting goods, entertainment and music categories not only reflects the company’s long-term advantage in these areas, but also its user experience. refined.

“Amazon can suggest books and related items to consumers shopping for sporting goods, for example. While Walmart can theoretically do the same, Amazon’s subscriber base provided detailed data that helps provide insightful suggestions,” the study adds.

With a substantial recovery in physical shopping this year, Walmart and other brick-and-mortar retailers can count on more foot traffic, though it remains to be seen where the mix will stabilize this year. Macy’s is betting big on toys also in 2022, on schedule to have Toys R Us stores in-store at every Macy’s store by the end of October.

In a July press release, Macy’s said, “Since last August, Macy’s customers have purchased the vast assortment of Toys R Us products online exclusively at macys.com/toysrus and ToysRUs.com, powered by the ecosystem Macy’s digital and fulfillment business. In Macy’s reported earnings for the first quarter of 2022, toy sales were 15 times higher than in the comparable period before the Toys R Us partnership.”

These add to action from LEGO, Mattel and others who have taken steps to support a toy industry that has weathered downward pressure this year. In a May announcement, LEGO said it will “intensify its digital investments in all areas of its business, from play to shopping and technology infrastructure”, with plans to triple its digital workforce in over the next three years.

Read more: Lego joins toy industry’s online transformation, bets digital bricks will click with kids

BNPL for the Holidays

It’s unclear whether consumers will want to split Walmart toy purchases into installments. Buy Now, Pay Later (BNPL) is used more online than in-store, which may give Amazon and other e-commerce players an advantage in Q4 BNPL usage.

With Walmart offering more than half of 2022’s most popular toys for $50 or less, the chain is sticking to its everyday low-price mantra, but with inflation squeezing budgets, more consumers can opt for methods like BNPL this season giveaways for extra breathing space.

According to “BPL and the in-Store Opportunity: Why Merchants Must Offer Payments Flexibility at the POS,” a collaboration between PYMNTS and Zip from a survey of more than 2,000 US consumers, “BPL was offered for approximately half consumers’ most recent online purchases. across all retail segments, but available for less than one-fifth of in-store purchases. The gap between online and in-store availability of BNPL was most dramatic for consumers shopping at local businesses. Online, 55% of these entities offered BNPL, while only 4.8% offered the method in-store.

It could also be a big year for BNPL when gift buying really kicks off on Black Friday (November 25) and Cyber ​​Monday (November 28) events, along with a rumored second Amazon Prime Day in October. Either way, merchants need to do a better job of communicating that BNPL is available at checkout for consumers who want to spread out 2022 gift payments.

According to “The 2022 Global Digital Shopping Playbook: US Edition”, a collaboration between PYMNTS and Cybersource, “many US merchants are also held back because their customers don’t realize they accept their preferred payment methods, especially the BNPL. Even though 55% of local merchants offer BNPL options, only 40% of local buyers realize that BNPL options are available. U.S. merchants will need to close this awareness gap to gain a competitive advantage.”

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About: Results from PYMNTS’ new study, “The Super App Shift: How Consumers Want To Save, Shop And Spend In The Connected Economy,” a collaboration with PayPal, analyzed responses from 9,904 consumers in Australia, Germany, UK and USA. and showed strong demand for one super multi-functional app rather than using dozens of individual apps.

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