Major retailers like Walmart, Amazon, and Target have a toy glut this holiday season.
Shoppers can expect deep discounts not only toys this year — but also on furniture, electronics, and small kitchen appliances, as stores look to pare back their inventories and appeal to shoppers disillusioned by inflation.
Retailers, bracing for last-minute shoppers, are also extending discounts through Christmas and onto lower price point items, The Wall Street Journal reports.
That means that there could still be some toys remaining on the shelves after Christmas that, potentially, could be discounted further.
Deals will be plentiful for shoppers. Even as retailers' profits suffer.
"People are waiting for deals—and they're going to wait to the last minute," says MGA Entertainment Chief Executive Isaac Larian. "I think Christmas will happen again for toy shopping during the last 10 days" of the shopping season.
"You are waiting a little more on pins and needles for the consumer to show up," says Steve Adolph, president of PlayMonster Group LLC, maker of Koosh balls and the Magical World of Disney Trivia game.
Walmart is beginning to see a marked difference in the buying behavior of its customers, hampered by inflation on food, gas and rent. "As we've exited the pandemic, and dollars are being stretched further, those [toys, furniture and small kitchen appliances] are items that are more discretionary," says John David Rainey, Walmart chief financial officer.
People struggling, and those tapping into their savings to pay for necessary everyday items, "are not going to continue to dig into their piggy banks to spend as we get into next year," Rainey says.
Mattel and Hasbro, two of the biggest toy companies in the U.S., are pulling out all the stops. Executives expect shoppers will push back purchases closer to Christmas Day, necessitating more advertising and discounts.
That has some toy makers already looking ahead to other holidays in the coming months, including Easter. That could mean continuing discounts but thinner inventory and consumer choices in 2023.
As Jonathan Cathey, chief executive of collectible figurine maker Loyal Subjects of Los Angeles, puts it, "We had a really good year — but the jets cooled down in what is usually the biggest selling season: the holidays."
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