Genna Rosenberg, CEO and chief ideator at GennComm, talks about supply chain shortages and toy shipments in the Toy Book’s annual State of the Industry Q&A.
The Toy Book: What were some of the challenges your clients faced in 2021, and how did you work with them to mitigate their effects?
Genna Rosenberg: Supply chain shortages definitely impacted GennComm PR clients from a media planning perspective. With uncertain and shifting timelines, launch dates, and inventory levels for some products, we worked in lock-step with our clients’ in-house teams to closely monitor on-shelf dates and delays in real-time. It was imperative to make sure all our promotional efforts were focused on products that would actually make it on shelves. Not only would it be disappointing to consumers if goods they read about were not available, but importantly, also because we want to maximize our client’s dollar spends and ROI by ensuring we were focusing on products that have the potential to actually sell. Also, while some classic, well-known brands, seasonal products, and games had more organic growth, for other lesser-known brands and new introductions that didn’t have the benefit of being previewed to media at toy fairs, we focused on collaboratively innovating with our clients to cleverly launch these new lines with media and influencers.
TB: How do you think retailers will cope with holiday 2021 toy shipments arriving in early 2022?
GR: 2022 will be another transformational year as it relates to seasonality of the toy industry, and it remains to be seen how consumer buying patterns will shake out. It’s going to take time for retailers to sell-through goods that were planned for fall and instead will arrive for spring when typically the product mix is lower-priced items. This backlog will certainly impact their buying levels for fall 2022, and even pre-pandemic it was already a trend for retailers to order “just in time” shipments. I believe we’ll see many of the companies reducing their new product investing and holding back certain items as they work to monetize investments in product lines that had delayed launches over the past year.
TB: Do you expect the increasing cost of raw materials for toys, games, and product packaging to impact toy prices in 2022?
GR: Manufacturers are feeling squeezed from both consumers and retailers to maintain low prices, but there’s simply no way for them to absorb 100% of the price increases. One way they’ll maintain prices is to do major cost reductions, and more scaled-down everyday items. I believe the dollar channel will see lifts as more people shop there as a result of rising costs at mass retailers. And I do think we will see rising prices in 2022 as a result of the massive price increase in raw materials coupled with the increased shipping costs.
This article was originally published in the February 2022 edition of the Toy Book. Click here to read the full issue!
