The prospects are bright, and another toy brand has completed tens of millions of dollars in financing!

Toys play an important role in children's growth. A good toy product can not only entertain children, but also help develop their intelligence. Under the influence of the global epidemic, parents are willing to buy more toys for their children as they spend more time at home.

As one of the representatives of the "stay-at-home economy" spawned by the epidemic , the global toy industry has experienced explosive growth in recent years. During some festivals, hot-selling toy products are frequently out of stock, and toy products have become a "star category" in the field of cross-border e-commerce.

StarPony Completes Over 10 Million USD Series A Financing

According to 36Kr, the global toy brand StarPony recently completed a round A financing of over 10 million US dollars. It is reported that this round of financing was led by eWTP and followed by Xiangfeng K2VC, with a post-investment valuation of over 100 million US dollars. This round of financing will mainly be used for talent recruitment, product development, brand building and other aspects.

StarPony belongs to Guangzhou Xingkong Youpin Technology Co., Ltd., which focuses on children's toy products. Its business covers the innovation and sales of global children's products, domestic e-commerce, cross-border e-commerce, etc. The core founding team is composed of senior executives from Alibaba, Huawei, Lingdong Chuangxiang, etc. The founder and CEO Shi Cangjian was the international general manager of Alibaba Mobile Division and is currently the president of Alibaba Games.

StarPony was founded in June 2020. In just two years, it has received three rounds of financing, with a valuation of over US$100 million. It can be seen that its development speed is still very fast. According to the official website, StarPony is committed to providing more creative toys for children aged 3-10 around the world.

StarPony's products include STEAM toy tables, 3D theater puzzles, mini kitchens, mini clinics, children's educational cameras, etc. Its products are sold on mainstream domestic e-commerce platforms such as Tmall, JD.com, and Pinduoduo.

After the domestic market operation became relatively mature, StarPony began to turn to overseas markets. Currently, StarPony's overseas business has expanded to the United States, Canada, Australia, New Zealand and many European countries, and its products have achieved good sales results in the European and American markets.

StarPony also has many hot-selling product links on the Amazon platform . Its original plush doll brand OUOZZZ has been online for only one year, and its current hot-selling items on the Amazon platform have nearly a thousand reviews, with a favorable rate of up to 86%.

The rapid development of the StarPony brand is closely related to the ever-expanding demand in the global toy market in recent years.

Current status of domestic toy industry

China is a major toy-producing country with a large number of toy manufacturing companies. It is the main concentration of global toy production and the world's largest toy exporter. About 75% of the world's toys are produced in China.

In 2020, my country's exports of traditional non-game toys reached US$33.49 billion, a year-on-year increase of 7.5%. The main destination markets for toy exports are the United States, the United Kingdom, and Japan. Exports to the United States amounted to US$8.57 billion, accounting for 25.6% of the total toy exports, an increase of 6.8% over the previous year.

At present, the regional distribution characteristics of domestic toy enterprises are quite obvious, mainly concentrated in coastal areas such as Guangdong, Zhejiang, Jiangsu and Shanghai, which are also the regions where the domestic toy industry is relatively mature. In terms of export volume, the top five provinces and cities in toy exports are Guangdong, Zhejiang, Jiangsu, Shanghai and Jiangxi.

In terms of the types of exported products, Guangdong Province is dominated by electric and plastic toys, Zhejiang Province is dominated by wooden toys, and Jiangsu Province is dominated by plush toys and animal dolls.

Among them, Guangdong is the largest toy production and export base in the country. Shantou City, as one of the regions in Guangdong with the most concentrated toy manufacturing enterprises, the highest scientific and technological innovation capabilities and product technological content, has formed a relatively mature and complete industrial ecology.

At present, domestic toy sales channels are mainly divided into distribution mode and direct sales mode, among which the direct sales mode is mainly divided into self-built sales channels, professional retail stores, hypermarkets, trendy stores and e-commerce platforms, etc. Due to the large variety of toy product categories and diversified channels, it is difficult for a single toy company to meet the diverse needs of end customers. Therefore, most domestic toy manufacturers adopt the dealer sales model, which is wholesaled to distributors or retail terminals through dealers step by step.

In recent years, with the rapid development of the e-commerce industry, expanding domestic and foreign markets through e-commerce channels has gradually become an important choice for domestic toy companies. Emerging channels such as Douyin, TikTok, short videos and mini programs have become a major boost to toy sales.

However, compared with toy companies in developed countries, the domestic toy industry has a lower market concentration and relatively low brand awareness. At the same time, there are problems such as small enterprise scale and short history and culture, which means there is a lot of room for integration.

Development prospects of the global toy industry

Compared with the domestic toy market, the global toy industry system is more mature, with a high degree of industry concentration and more well-known brands. IPs such as Gundam, Ultraman and Disney are particularly popular.

According to data released by the US market research firm NPD, the global toy market size reached US$90.7 billion in 2019, just one step away from reaching US$100 billion.

At the same time, according to the forecast of international research organization Research and Markets, the global toy market will grow at a compound annual growth rate of more than 4% between 2019 and 2025. During the forecast period, the global toy market size is expected to increase by more than US$30 billion.

According to a report by the China Business Industry Research Institute, the global toy market demand is growing steadily. Among them, emerging markets represented by Eastern Europe, Latin America, Asia, the Middle East and Africa are growing rapidly, and the concept of toy consumption is gradually extending from mature European and American countries to emerging markets.

The large number of children in emerging markets, lower per capita children's toy consumption and good economic development prospects make the emerging toy market have higher growth potential, and this market will also become an important growth point for the global toy industry in the future.

As more and more sellers enter the toy industry, the industry has also seen higher entry standards. As people's environmental awareness strengthens, toy consumers have put forward higher requirements for toy quality based on their own health and safety considerations. Toy importing countries have also formulated increasingly stringent safety and environmental standards to protect the health of domestic consumers and the domestic toy industry.

At the same time, with the advent of the smart era, the product structure of toys has begun to tend towards electronicization. At the opening ceremony of the New York International Toy Fair, Io, chairman of the American Toy Association, pointed out that the combination of traditional toys and electronic technology is an inevitable trend in the development of the toy industry.

In addition, the development of the toy industry is now more closely linked to the cultural industry. The prosperity of cultural industries such as film, animation, and national trends has provided more materials and broadened the thinking for the research and development of traditional toys. The prototypes of the popular Gundam Warriors, Disney series toys, and Super Wings all come from related film, television, and animation works.

European and American countries have always had very high requirements for the review and quality of children's toys. Sellers who want to enter this market need to do sufficient homework in terms of product selection. At the same time, different countries have different cultures for children, which sellers also need to understand.

References: China Business Industry Research Institute, Euromonitor data

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Toy Market