Toys And Games in Hong Kong, China
Euromonitor International's Toys And Games in Hong Kong, China report offers a comprehensive guide to the size and shape of the traditional toys and games and the video games market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market- be they new product developments, distribution or pricing issues. Forecasts illustrate how the market is set to change.
Chapters: 6 | Tables: 18 | Publication date: Sep 2004
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive environment
Executive summary
Video games drive overall performance
Toys and games overall registered a growth rate of more than 3% in current value terms to reach HK$1.3 billion in 2003 in Hong Kong, a growth primarily driven by video games. In 2003, video games sales approached HK$280 million, representing a current value gain of nearly 9%. Though impressive, this still marked the lowest one-year gain of the review period. Part of 2003’s diminished value growth for video games stemmed from the fact that the current video game cycle began way back in the spring of 2000 (in Japan) with the introduction of the next generation of Sony's PlayStation platform, the PlayStation 2 (PS2) video game console. Since its introduction in Hong Kong in 2000, followed by Nintendo's GameCube (at the end of 2001), and Microsoft’s XBOX (2002). Moreover, competition between console manufacturers has led to manufacturer led price cuts for these video game consoles. Between 2002 and 2003, the prices of both the Sony PS2 and Microsoft Xbox decreased from HK$2,399 to about HK$1,499, whilst the price of the Nintendo GameCube fell from HK$1,550 to HK$799.
Lack of blockbuster products in traditional toys and games
Worth over HK$1 billion, traditional toys and games in Hong Kong in 2003 stood at a crossroads, as overall growth slowed to a modest current value growth rate of 1.6%. Traditional toys and games has essentially matured, and economic conditions have softened. Although recognized for its inherent creativity, this area has lacked a sense of innovation in recent years, added to the fact that the primary target audience –children under 15 years of age – has been shrinking at an annual rate of 1.2% over the review period. With the advent of video games, the performance of traditional toys and games has slowed, reflecting changes in consumer demands.
Shorter shelf-life concerns
With keen competition from the Chinese mainland and increasing pressure from buyers around the world for new and innovative products, external pressures are high. Product shelf-lives are getting shorter and consumers more demanding. The major companies have been struggling to come up with new products.
Video games, 2004 and beyond
Video games goes through a cycle every six years or so, as one generation of consoles succeeds the previous one. As new hardware emerges, it takes a year or two for software developers to hit their stride; then a boom ensues. The biggest current challenge in video games is the shift towards network gaming, which offers the prospect of solid, reliable service revenues to balance the volatility of games sales. As mentioned above, the current cycle began in 2000 with the launch of Sony PlayStation 2 (PS2). The changes expected in the next video game cycle will include enhanced speed and game play, more detailed graphics, and increased online functionality. At this time there is no indication of a material change in terms of a single or multi-functional hardware devices.
Table of contents
1. INTRODUCTION
2. EXECUTIVE SUMMARY
Video games drive overall performance
Lack of blockbuster products in traditional toys and games
Shorter shelf-life concerns
Video games, 2004 and beyond
3. MARKET PERFORMANCE
Performance driven by video games
New products and old favourites for Christmas 2003
Intellectual property piracy is rife
2003, midpoint of the current video game cycle
Hong Kong, the largest toys and games exporter in the world
Table 1 Retail Sales of Toys and Games: Value 1998-2003
Table 2 Retail Sales of Toys and Games: % Value Growth 1998-2003
Table 3 Toys and Games Company Shares 2002-2003
4. TRADITIONAL TOYS AND GAMES
4.1 SECTOR PERFORMANCE
Lack of blockbuster products, threatened by video games
Biggest share goes to multinationals
Disney toys licensed to Playmates Holdings Limited (HK)
Pre-school toys grow strongly
Educational/scientific toys bolstered sales of activity/construction toys
Model vehicles, to play with or to collect
Limited home space restricted indoor games growth, but helped outdoor games
Dolls/figures struggling
Soft/plush toys not only for kids
Infant toys influenced by low birth rate
Hong Kong toymakers bank on technological edge over rivals from mainland China
Table 4 Retail Sales of Traditional Toys and Games: Value 1998-2003
Table 5 Retail Sales of Traditional Toys and Games: % Value Growth 1998-2003
Table 6 Traditional Toys and Games Company Shares 2002-2003
4.2 NEW PRODUCT DEVELOPMENTS
Summary 1 Traditional Toys and Games New Product Developments 2002-2003
4.3 RETAIL DISTRIBUTION
Toys specialists and department stores dominate
Hong Kong Toys R Us—franchised by Li & Fung (HK)
Table 7 Retail Sales of Traditional Toys and Games by Distribution Format: % Analysis 1998/2003
5. VIDEO GAMES
5.1 SECTOR PERFORMANCE
Video games cycle – every 6 years
Hardware competiton focuses on price war & online gaming
Game oriented software
Summary 2 Number of Software Titles per Hardware Console (as of December, 2003)
Established franchises
Besides software innovation, sales growth also depends on ageing of game players
Growth also depends on the installed console base
SWOT analysis for video games
Significant differences between the three video game consoles
Summary 3 Significant Differences Among the 3 Video Game Consoles
Three players dominate
Sony hit the shelf with white console and new software in Chinese
Summary 4 New PlayStation 2 Software Title in Chinese
Online games show small share of PC game software in 2003
Online gaming strategies – Microsoft is the most aggressive
Electronic Arts Inc the major software player in video games
Soft-World Hong Kong Ltd, leader in PC games
Software piracy –45% of software sold in Hong Kong is pirated
Nintendo wins case against Hong Kong copying device distributor
Table 8 Retail Sales of Video Games: Value 1998-2003
Table 9 Retail Sales of Video Games: % Value Growth 1998-2003
Table 10 Video Games Company Shares 2002-2003
5.2 NEW PRODUCT DEVELOPMENTS
Sony release PSX - a new PlayStation device
Additional information for Sony PSX specification
Plans to launch Sony PSP to compete with Game Boy Advance in 2004
Microsoft unveils much-anticipated action role-playing game
Software development depends on movies and television
Konami selling mobile phone games in Hong Kong
Summary 5 Video Games New Product Developments 2003-2004
5.3 RETAIL DISTRIBUTION
Table 11 Retail Sales of Video Games by Distribution Format: % Analysis 1998/2003
6. FORECAST MARKET PERFORMANCE
Growth to be driven by video games
Industry trends for traditional toys and games
Further price cuts expected in video games
The next video games cycle –Sony PS3 & Xbox 2 in 2006?
If so, the up-down-up growth rate for video games
Table 12 Forecast Retail Sales of Toys and Games: Value 2003-2008
Table 13 Forecast Retail Sales of Toys and Games: % Value Growth 2003-2008