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Toys e-tailing gaining steam in India

The kids market in India is estimated to be at Rs 26,000 cr of which the toys segment alone comprises Rs 5,000 cr

K Rajani Kanth  |  Hyderabad 

With improved infrastructure such as logistics and wider penetration of courier services in even smaller towns, coupled with rising disposable income levels, the domestic online toys retailing market is gaining momentum, according to industry players.

“Convenience of buying and home-delivery, discounts of up to 50% and product reviews that help the customers take an easy decision, are also the factors that are triggering the growth of online toys market in the country,” says Prashanth Gowriraju, founder and chief executive of Hyderabad-based Hoorayy Technologies, which floated exclusive online toys store, which at present is doing about 120 transactions day with an average ticket size of Rs 1,200, has closed the year ending March 2012 with a turnover of Rs 2.5 crore, and is gunning at 3X from the last year.

The kids market in India is estimated to be at Rs 26,000 crore of which the toys segment alone comprises Rs 5,000 crore. About Rs 1,700 crore of this is organised, which is majorly captured by Chinese products. Now on a growth path, registering a year-on-year growth of 35%, the domestic market is set to touch Rs 11,500 crore by 2014.

Though the Indian online toys retailing currently accounts for 5 per cent of the overall toys market, it is expected to grow at a compound annual growth rate of 25%, on the back of change in people’s perception, growth in playschools and increasing awareness on quality issues.

According to Rishabh Garg, director of Spire Online Services’, a Noida-based online toys shopping site, an interesting phenomenon that has started kicking in is of ‘age compression’, where children are abandoning the traditional toys in favour of video games at an earlier stage than before.

“Currently, a majority of the players in this segment are targeting the children from zero-plus months to 12 years of age, and selling from consumerables like baby soaps and diapers, to toys. Due to the increased focus on child safety, branded toy sales are soaring. Also, growth in the Indian middle-class, which places much emphasis in child education, is resulting in increased sales of educational and learning toys,” he adds.

The new trends WoWkart foresees in the online toys market are towards increase in the interactive component of e-commerce sites with toy experts, who can guide customers to make the right purchases based on their child developmental requirement, Garg says, adding that the company was currently making revenues of Rs 5 lakh a month, and was aiming to reach up to Rs 8 lakh per month, within six months from now.

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First Published: Thu, October 11 2012. 12:04 IST