The global smart toys market is expected to reach USD 24.65 billion by 2025, growing at a CAGR of 15.5% from 2017 to 2025. The growth is attributed to the increased awareness of technology led education in children starting at an early age to improve physical, mental and intellectual skills.
Smart toys are often referred to as connected toys as many of them are connected to the Internet or cloud. These products are expected to emerge as one of the prominent categories of the Internet of Things (IoT) which leverage speech recognition and cloud computing to improve the learning ability. However, these toys mainly the connected toys are prone to cyber-attacks and thus pose a serious threat to the security of parents and children.
In 2015, a cyber-attack on the Hong Kong-based company VTech Holdings, a key service provider in the digital learning market, exposed the data of 6.4 million children, Therefore, the leading smart toy manufacturing companies are increasing spending towards the inclusion of new checkpoints in their finished product forms in order to overcome the security challenges in the coming years.
New product developments are expected to play a crucial role in increasing the awareness of smart toys. Toys such as Smarty, designed for children in the 5–12 years age group answers to questions asked and puts a reminder, acts as an alarm, controls the lightings of a room and voice reads books. Also, the introduction of products such as robot dog, SuperSuit for laser tag; and ROXs to lure children is expected to remain a favorable factor over the coming years.
Toddlers segment is expected to be the fastest growing segment with a CAGR of more than 16.3% from 2017 to 2025. The rising influence of digital education among kids is expected to have a positive impact on the market in the coming years. Such games help toddlers to adopt digital learning from an early age.
Asia Pacific market is expected to witness the fastest growth with at a CAGR of more than 18.2% from 2017 to 2025. Over the coming years, vendors are expected to focus on low penetrated countries, especially in the Asia Pacific region. To this end, countries such as India and China present a considerable growth prospect for the market. Companies are expected to focus on expanding their reach through online platforms which will also help in increasing their visibility.
Some of the key manufacturers include Dream International, Jakks Pacific, Inc., Hasbro Inc., Makeblock Co., Ltd., The Lego Group, Mattel Inc., KNEX Industries Inc., UBTECH Robotics, Inc. Product innovation and portfolio expansion are key focus areas for the manufacturers in the coming years. In key growth countries such as India and China, manufacturers are expected to adopt the omnichannel strategy, which will help them in leveraging the strength of offline stores that command a major share of the distribution aspect of smart toys.
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Hexa Research has segmented the global smart toy market report based on user, distribution channel and region:-
Segmentation by User
• School going
Segmentation by Distribution Channel
• Convenience store
• Specialty store
• Online channel
Segmentation by Region
• North America
• Asia Pacific
• Middle East & Africa
• Central & South America
Key players analyzed
• Dream International
• Jakks Pacific, Inc.
• Hasbro Inc.
• Makeblock Co., Ltd.
• The Lego Group
• Mattel Inc.
• KNEX Industries Inc.,
• UBTECH Robotics, Inc.
• Kids II, Inc.