Children's Online Privacy Protection Act Committee For The Toy Industry

5. Political/Regulatory

Opportunities

• The establishment of TOYPAC (political action committee for the toy industry) has provided a platform for the toy makers to engage policy makers and enhance advocacy efforts for the industry.

• The passing of the Consumer Product Safety Improvement Act (CPSIA) of 2008 has enhanced the safety standards and requirements for toy manufacturers. This has enabled toy manufacturers to efficiently meet safety standards and avoid toy safety threats and law suits that could be costly.

• Another act that has influenced the toy and game industry is the Children’s Online Privacy Protection Act (COPPA) that requires every website to seek parental consent before collecting any information on children using online platforms

For instance, the Toxic Substances Control Act of 1976 regulates chemical components in products used by children.

• The sale of some toys and toy products have been banned in the U.S. because of safety concerns. For instance, through the Consumer Product Safety Improvement Act, some toy products like Matador Barbie and Sky Dancers were banned in the U.S. this has negatively affected the growth of toy manufacturers like Mattel.

• Another threat is heavy taxation on the toy industry that is expected to rise in future. According to the Toy Association, out of $22 billion generated by the toy industry through sales, $10 billion in tax revenues are generated. Out of this, combined state taxes make up to $4.4 billion while combined federal taxes make up the remaining $5.6 billion (Toy Association 2).

6.

Besides, key players like Mattel have experienced a dip in sales in recent years. For instance, Mattel’s Barbie revenue dropped by 15% in 2015. Such declining sales are a common feature in the maturity stage of industry life cycle. However, the industry is still recording significant growth of sales of digital games and toys following technological advances (Follett 238). Besides, emerging markets and Latin America and Asia promise positive growth in the next few years. In order to remain competitive, reduce costs and expand product lines amidst declining sales and growth, the major players in the toy market are considered various strategies like licensing and copyrights. In the near future, mergers and acquisitions are possible for the key players in the industry in attempts to maintain