Robotic toys: A $62 billion global opportunity
With rising interest in technology and digital lifestyles, the global robotic toy market is expected to surpass around US$ 63.5 billion growing at a CAGR of 17.5% during the period 2023-2032. India’s robotic toys industry is still in its infancy, though it holds a tremendous opportunity in the sector driven by R&D around the latest technologies like AI, a strong startup ecosystem and being fuelled by the New Education Policy.
But in order to become a frontrunner and a possible export hub, it is important that electronics component manufacturing shifts to India.
Technology advancements have led to an evolution for children, both in the ways that they play and learn. Conventional ways of learning are now a thing of the past, and the market is is inundated with a wide range of high-tech multipurpose robotic toys, which are engaging, entertaining as well as educating.
Robotic toys are electronic toys, which are designed to imitate the behaviours and movements of real robots. Featuring sensors and motors, these toys interact with their environment and respond to commands without any participation or intervention from humans.
From humanoid robots to robotic pets, this product category has exploded over the past few years owing to advancements in Artificial Intelligence (AI) software and hardware components. With the popularity of AI, many manufacturers have developed educational and toy robots that combine learning experiences with fun activities.
Robotic toys are gaining popularity due to various reasons:
- Toy robots provide an interactive experience for kids as they help develop skills like problem-solving, object recognition, hand-eye coordination and creativity.
- These robots are designed to teach children about science, technology, engineering and mathematics (STEM) concepts in a fun and engaging way as well as complex subjects like programming etc.
- They improve capabilities like voice command recognition, speech, pronunciation and language.
- After the onset of the Covid-19 pandemic, there has been a significant spike in online learning, where advanced and convenient self-learning tools have become popular.
Global Robotic Toy market
The global robotic toy market including robots, interactive games and educational robots is expected to surpass around US$ 63.5 billion by 2032 from US$ 13.18 billion in 2022 with a CAGR of 17.5% during the period 2023-2032, according to a report by market.us. The market is driven by various factors including increasing interest in STEM education, technological advancements and rising demand for interactive and engaging toys.
U.S., Canada and Mexico in North America dominate the autonomous robot toys market with a 43% share followed by Europe, which is credited to the high adoption rate of autonomous robot toys in educational institutes as well as rapid advancements in science in these countries. Due to the growth in the adoption of classroom automation equipment, Asia-Pacific is projected to be the fastest developing region during the period 2023-2030.
The Educational Toy Robot market is a competitive space as various brands are working to grab the attention of both children and adults alike. However, there are several challenges faced by the industry, some of which are listed below:
- Ensuring that the product is equipped with the latest technology which is safe and easy to use.
- Lack of awareness regarding robotic toy technology can challenge the growth of the autonomous robot toys market.
- Shortage of raw materials and dependency on other countries as well as shipping delays could lead to slow growth in the industry.
- Robotic toys are expensive due to the high cost of spare parts and high-end technologies.
- Robotic toys are operated via mobile apps and require internet access which confines the use to suitable places only, affecting the sales of the product.
India’s foot in the door?
The Indian toys Industry is estimated to be US$ 1.5 billion covering 0.5% of the global market share. The industry is expected to grow to US$ 2.73 billion by 2027 at a CAGR of 12%. However, the country is currently confined to conventional toys and has not yet tapped into the robotic toy market.
Prashant Mamtora, Founder and CEO of Havi.co, a company that makes DIY robotic kits, admits that the Indian robotic toys market is at a nascent stage at present and is yet to pick-up, though early traction is being seen in online sales and high end brand stores. However, he adds:
“As New Education Policy (NEP) would come in to execution fully, the market of robotic toys would increase for sure. That’s a welcome move by the government. It will benefit students at large. Government should further emphasis DIY culture amongst students starting from second or third standard itself. Offering them robotic kits at early age will build their aptitude towards technology and students will grow up with right mindset to solve larger problems.”
Robotic toys have the potential to create a new form of entertainment without changing functionality of toys, thereby spiking demand and leading to overall market growth.
As consumers increasingly adopt digital lifestyles and early exposure to technology-based options for learning and education, this has generated immense scope of innovation in this segment. The market is anticipated to experience new opportunities for growth as a result of a surge in e-commerce businesses and consumers’ rising interest in animated movies.
Various Edtech start-ups have started addressing these needs with cutting-edge technologies to instruct, amuse and engage contemporary students. Shabbir Gabbaji, Partner at ToysBox states:
“India is in the primitive stage of creators manufacturing robotic toys for kids, as the source of raw material for electronics still remains with China. Specializing in manufacturing items like motor, electronic components, programmers etc. can help make economically priced toys and export in the global market.”
Although India is in the infancy stage of the robotic industry front, the country’s robotic toy industry has experienced significant growth and development in recent years, driven by technological advancements, changing consumer preferences, and increased investment in research and development.
Government initiatives and policies aimed at promoting the manufacturing sector and supporting startups have also played a crucial role in the growth of the Indian robotic toy industry. The increasing adoption of artificial intelligence, virtual reality, and augmented reality technologies in toys is expected to open up new possibilities and create more immersive and interactive play experiences for children. Additionally, collaborations with educational institutions and content creators can help bridge the gap between entertainment and learning, making robotic toys an integral part of children’s holistic development.