Following today’s release of The Entertainer FY figures for 2019/20, Jonathan Rock, Retail Analyst at GlobalData, a leading data and analytics company, comments:
“A lack of toy crazes and challenging high-street conditions decimated profit at The Entertainer in the year ending January 2020, falling 28.6%. Thankfully, the integration of the Early Learning Centre (ELC) brand, eight new stores, and the collapse of Mothercare PLC supported total sales, which grew 9.6%. ELC’s international presence also allowed The Entertainer to grow its revenue from outside Europe by over 50% compared to the year prior.
“In the current financial year, online sales helped offset lost store sales over lockdown, and the toy retailer is now focused on accelerating its online and fulfilment capabilities. After lockdown, the retailer introduced its ‘Ready in 10’ initiative, which fast-tracked customers to the payment areas if they knew what they wanted, and allowed customers queuing outside the store to order from their phone for collection in store, helping to keep up with the high levels of pent-up demand seen as restrictions were lifted.
“The Entertainer has looked to concession stores and international partnerships to increase its market presence. Concession stores continue to be a strong point, with 44 more opening this year and ASDA announcing a partnership in five of its larger supermarkets in October 2020. In June, an ELC concept shop-in-shop also opened in the Birmingham Bullring. Internationally, The Entertainer has plans to open stores in Mumbai and Malaysia this year, markets with rising consumer incomes and less exposure to toy alternatives such as mobile and gaming. The 2018 acquisition of Spanish toy retailer Poly and ELC’s international presence has already greatly increased international sales, with European sales up 184.4% and non-European sales up 57.2%.
“The Entertainer will be held back in the run-up to Christmas as the next generation of consoles significantly limits demand for toys. This is worsened as children are enjoying gaming at an earlier age. The Entertainer must focus on products popular during COVID and with parents to challenge the popularity of gaming, such as educational, outdoor, and sustainable toys and games. The retailer should also consider introducing sustainability initiatives and broadening its range of educational toys on topics such as the environment, food, and STEM. New business models such as subscription services, or partnerships with video game producers to create themed toys, could help retain demand.”