Smart toy sales are expected to reach $15.5 billion in hardware and app content revenue by 2022, an increase from a previously estimated $49 billion.
This is according to a report from Juniper Research. The new study, "Smart Toys: Hardware, Technology & Leading Vendors 2017-2022", was released this week.
According to the research firm, the increase will primarily be driven by the growing popularity of smartphone-based connected toys and the enduring appeal of console-connected 'toys to life', action figures that interact with a video game via a reader device.
The research identified Lego as being particularly well positioned in this category, with its successful 'toys to life' range, Lego Dimension.
Juniper forecasts 224 million smart toys will be shipped worldwide in 2017.
The study further found many players in the smart toy segment are not only appealing to children, but also to 'kidults' and collectors, as demonstrated by Sphero's BB8 app-enabled droid and Lego Dimension's A-Team and Ghostbusters sets.
Meanwhile, Reuters reports Mattel expects to grow by three to four times in the more than $31 billion toys and games market in China by 2020 through digitally connected toys, as it intensifies its efforts to take on Lego and Hasbro in China.
Mattel ? which cut its dividend by more than half to fund the new efforts ? said its emphasis on e-commerce and repackaging its core brands as educational toys and connecting them to the Internet would propel its position in the fragmented market.
The toymaker has about 2% market share in China, lagging behind construction toy maker Lego, which has 2.8% control over the market, reported Reuters. Hasbro is catching up with 1%, according to Euromonitor International.
The Juniper report states China will account for 18% of global smart toy shipments by 2022, representing an average annual growth of 42%.
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