6-year-old millionaire cashes in on influence over the toy market - Outside Insight
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6-year-old millionaire cashes in on influence over the toy market

Influencers come in all shapes and sizes. Why YouTube stars like 6-year-old Ryan are threatening traditional departments stores

Key Takeaway

It’s been a rough year for Toys R Us. After they filed for bankruptcy earlier this year, many eyes are eagerly awaiting results from the holiday shopping season. But the popularity of new marketing channels indicates that consumer behavior has changed. Today’s shoppers are turning to YouTube stars they know and trust to choose their holiday purchases, and they’re increasingly shopping online, rather than in store.

Ryan ToysReview influences retail sales

YouTube star Ryan made $11M reviewing toys this year. He’s also attending the first grade. This 6-year-old millionaire published his first video on his channel, Ryan ToysReview, in 2015 at the age of 4. Today he’s #8 on Forbes’ list of top 10 highest paid YouTube stars in the world.

According to the Washington Post, “For some of his youngest fans, Ryan is not just some stranger on the Internet. He is their friend.”

YouTube stars earned a combined $127M this year, up 80% from previous years. According to Jim Silver, CEO of the review site Toys, Tots, Pets, and More, in an interview with the Verge, these homemade video stars have the power to make or break sales. “If a product gets 10 million, 20 millions views, and you see that Ryan loves it, or other kids love it, it has a huge impact at retail.”

YouTube stars like Ryan and his parents are learning quickly how to maximize the channel’s algorithms for max viewership, as more and more videos begin to target the young audience.

Many of Ryan’s videos, for instance, include pulling toys out of giant “eggs.” Data indicates that many of his most popular ones include a title with the word “surprise.” Another popular toy reviewer (with channels including Fizzy Toy Show, Fizzy Fun Toys, and ZigZag Toys) has discovered that 13 minutes is the ideal video length to maximize profits.

What’s concerning for some is that as more of these channels begin to pop up, they’re copy-catting one another in an attempt to mimic what’s working well. This potentially deprives young viewers of the originality and thoughtful nature that was characteristic of long-standing children’s programming like Sesame Street and Blue’s Clues.

“It can often feel that Kid YouTube is founded on the premise that young children lack distinguishing taste. That they cannot tell the difference between an FCC-approved, million-dollar television show and a mom unwrapping action figures on a kitchen counter. It is a cynical, and potentially accurate perspective.”

"If a product gets 10 million, 20 millions views, and you see that Ryan loves it, or other kids love it, it has a huge impact at retail.”

A shift in consumer behavior

What this indicates is that in our new digital reality, the hierarchy of marketing channels has shifted. Toy brands today need to know who the influencers are and how to reach them. They can no longer rely on traditional methods like Toys R Us shelves, catalogs and television spots. Sales from previous years won’t indicate what will be popular today – everything is changing in real time. What’s more, one negative review from a star like Ryan can send a top product plummeting in a matter of minutes.

The strategy is reminiscent of television spots in the past. According to Daily Beast, “It’s similar to the strategies employed by Nickelodeon and Cartoon Network for years—filling up hours of after-school television with garish, hypnotizing reruns. But people like [Fizzy Toy Show host Ms. Hands] realized they could have the same success with far less overhead.”

Experience is king

In addition to discovery for new products, today’s consumers seek validation that what they’re purchasing is the best possible option. According to  Google’s latest holiday shopping trend report, in top retail categories, Google searches related to “best” products grew 50% in the last year. Today we look to online reviews from other consumers, videos from influencers we trust and often an online price comparison while standing right there in the aisle, in order to feel assured we’ve chosen the best product, at the best price.

Today’s shoppers care much more about the best possible shopping experience and value comparisons than they do about brand loyalty – particularly as the holiday shopping season reaches its peak.

According to Google, 68% of mobile shoppers in consumer electronics, for instance, watched gift guide videos on YouTube for holiday shopping ideas and advice – tossing the bulky retail catalogs of the past out the window.

Brands can look to these videos, and perhaps more importantly consumers’ comments and social media conversations around them, as a massive indicator of what’s trending, what’s tanking, and potentially what’s on the brink of becoming the next Beanie Baby or Furby phenomenon. Those that aren’t looking out at these essential indicators may find themselves facing the same fate of retailers like Toys R Us that have failed to adapt to changing consumer behavior.