Online toy sales grew exponentially last year, soaring from $45 million in 1998 to $425 million, according to a new report by the NPD Group and Media Metrix. At the current rate, their report foresees online toy sales hitting $1.6 billion by 2002.
Online toy sales represented 2% of 1999's $23 billion in toy sales. The total was up 8.6% over 1998.
Despite Web site outages and slowdowns during the peak December selling season, NPD says 95% of online toy buyers were satisfied," if not extremely happy," with their shopping experiences.
Toy e-retailers show signs of overcoming barriers to online sales. A consumer poll conducted last year by NPD showed 55% unwilling to pay shipping costs. By January, the figure had dropped to 32% of respondents. And the 46% who earlier said they wanted to see goods before buying them fell to 29%, a decrease the two firms attributed to better product information. Return policies, cited last year by a quarter of respondents as a barrier to online toy shopping, were problematic for only half as many in the January survey.
"We've seen consumers' confidence in e-commerce grow over the past year, much to toy e-tailers' good fortune," says Michael Redmond of NPD's Toy Division. "In 2000 and beyond, they'll have to continue to address technical issues and site maneuverability in order to support all of the customers they attracted during last year's holiday shopping season. Consumers want speed and convenience. Those will be the big concerns going forward."
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