Focus on Small Doll W/ Evergreen Play Pattern

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1 CONTACT: KidStuff Public Relations Lisa Orman, or Hong Kong to Atlanta to Dallas; Diverse Insights' top trends from January Trade Shows Dallas, TX (January 30, 2017) - - "How was your year?" Those four words were uttered by me more than any other during the first four weeks of the year. Meetings with suppliers, licensors, PR firms, inventors, warehousers, representatives, and anyone else tied to the toy and gift business. I learned that most people had a year that was brilliantly described by one savvy Houston merchant "As not our worst year, but not our best." The industry overall was on pace for another growth year with Q3 ending up 7% and finished the year up 5% year over year. Supercategories that led the way included Games/Puzzles, Dolls, & Outdoor Toys. The surprising trend of building sets being down was confirmed with a 3% decline year over year. The Following are the latest trends I discovered during my travels to Hong Kong Toy Fair (Jan. 3rd 8th), Atlanta Gift Show (Jan. 10th 15th), & Dallas Gift Show (Jan. 18th 22nd) Trade Show Trends Focus on Small Doll W/ Evergreen Play Pattern In no way do I believe girls 4-11 are going to stop collecting Shopkins (#1 girls brand); however the market for static micro collectibles is getting oversaturated. A new trend emerged of combining impulse product with a classic play pattern like hair play, micro poseable plush, and velvety flocked mini figs. Everything mentioned in this trend retails for under $ and most under $5 keeping true to pocket money budgets. We aren't trying to reinvent the wheel here from the last two growth years, just inflate the tires.

2 Piwi Pets, Blip The most adorable and potentially biggest volume new introduction from the shows was Piwi Pets. Think mini beanie baby posable plush that were made from fabric scraps & fun vibrant colors in patterns! Really cute blind box that resembles Chinese take out and a massive TV campaign through fall that will carry this new introduction to the finish line. A new trend emerged of combining impulse product with a classic play pattern like hair play, micro poseable plush, and velvety flocked mini figs. Cupcake Surprise, Sunny Days Ent. One of the biggest hits in this space in 2016 was a brand you've never heard of - combining simple transformation, classic hair play, and scented character - cupcake surprise sold over 12 million units in Europe last two years! Supported by spring TV to launch in the State, this should be a winner pre-easter. Safaris, SIMBA DICKIE GROUP Cute, flocked, dragons have come from Europe to the US! These really stood out to me because of how sweet & wholesome they looked - almost a throwback to 90s style guides. They come in bright colors and surprise blind bags, they are soft, textured, and ultra collectible.

3 THE YEAR OF FIDGET Fidgeting was never considered a play pattern, much less a category in the industry but I believe this trend will reshape retail in Fidget items are gender neutral, carry a higher perceived value, and have a wide target audience range. The dollar per square foot productivity of the category is significantly higher than core impulse and blind bags. FIDGETing helps you stay focused. The American Psychiatric Association (APA) says that 5 percent of American children have ADHD but the Centers for Disease Control and Prevention (CDC) puts the number at more than double the APA's number. The CDC says that 11 percent of American children, ages 4 to 17, have the attention disorder. This creates a gender neutral market for kids that need something tactile to help them stay focused. Millennials (83 million in US), who now outnumber any other portion of consumer society use fidget toys as stress relief and a break from mundane office life - perfect for your back to school/college planograms. Adult/ executive gifting is another area where this trend can live at retail as white space exists there when it comes to innovation. SPEKS: The Evolution of BUCKYBALLS One of the greatest impulse products is BACK! Or rather a new version! The team behind the original magnet craze is back after going head to head with the CPSIA and winning with a new addicting magnet product called SPEKS! Think of it as magnetic sand that you can build with at your desktop! Already 23 million Facebook video views when Will Smith's daughter Willow shared the sizzle! POP SOCKETS BY POP SOCKETS FIDGETing helps you stay focused. Although officially a mobile accessory that allows you to comfortably hold any phone or mini tablet - don't overthink the fidget factor. This addicting phone holder also doubles as a stand for watching Netflix. Adhering to any phone manufacturer's product allows maximum sku potential... Oh, and it was the single hottest item in Atlanta and Dallas gift shows.

4 Fidgety Block by Fidgety Another absolutely addicting click/shift/joystick toy that fits in the palm of your hand. Seriously this thing looks so simple but once you figure out each of the 6 sides is a unique fidget toy, you obsess about which is your favorite! Great pop colors make it fashionable to take it on the go! Although Pantone called Greenery its color of the year, it was very evident that rose gold was the color in the gift industry. Products blushed in various categories from barware & hydration to stationary. Muted flat colors like teal, violet, peach, were also prominent. WE LIVE LIKE THIS hydration, Manta Paperclips, NPW Plum & Punch, Hallmark Corp

5 PJ MASKS I wrote about this in Diverse Insights' Dallas Fall Toy Preview: Trends & Licensing Recap, PJ Mask is the NEXT BIG THING. Preschool is the largest super category in the toy business and this new license on Disney Jr. is proving to be the fastest rising license. After a successful exclusive launch at TRU, the brand is now open to all retailers and is already seeing stellar sell-through in store and online. "This will be my 2nd biggest preschool play in 2017 only after Paw Patrol" said one buyer at a prestigious mass Micro Lights from TECK 4 KIDS Hideaway Play Tents from Play Hut

6 POP CULTURE AUTOMOTIVE There are a lot of signs pointing to the vehicle as the next pop culture decor spot. If fandom has already filled basements, living rooms, cubicles, and offices - why wouldn't a little pop culture go on your preferred mode of personal transportation? The auto industry knows their consumers are fans and are already trying to market with that message - remember this commercial for Nissan Rouge One Star Wars Edition? Ride With by Thumbs Up Think of a baby on board sticker that adheres to the backseat driver side window. It lets you play chauffeur to your favorite political figure or pop culture licensed character (in development). An under $9.99 novelty that will for sure be a head-turner in the HOV lane! Transformer Family Decal Sticker Set by Elephant Gun Thank you for taking the time to read this, if you would like to discuss anything in this trend report in more detail please don't hesitate to contact me SteveS@Divers .com or follow my adventures visually on Instagram Steve Starobinsky Chief Discovery Officer Diverse Insights