The toy business reinvents itself amid digital challenges in Argentina

The Argentine toy industry is grappling with a profound crisis, marked by declining sales and evolving childhood habits. A scene from Toy Story 5, depicting a girl engrossed in a tablet instead of toys, encapsulates the industry's central challenge: competing for children's attention in an increasingly digital world.

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The industry is going through one of the most difficult moments in recent years. The crisis affects the entire value chain: toy stores, wholesalers, distributors, importers, and manufacturers.

Official figures paint a stark picture. The Argentine Chamber of the Toy Industry (CAIJ) reports a market contraction of nearly 22% between 2015 and 2025. Sales in the first half of this year fell by approximately 20% compared to the same period in 2025, following a 5.2% decrease in unit sales during last year's Children's Day, a key commercial event for the sector.

Julián Benítez, manager of Institutional Relations and Foreign Trade at CAIJ, described the situation as one of the most difficult in recent years, affecting the entire value chain from manufacturers to retailers. He noted that the declining birth rate, down 42% since 2015, has reduced the potential customer base. "The time spent playing with physical toys increasingly competes with screens," Benítez stated, emphasizing that physical play offers irreplaceable cognitive, emotional, social, and motor development benefits.

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The time spent playing with physical toys increasingly competes with screens, in a context where the birth rate has also fallen 42% (Indec), going from 2.4 children per woman in 2015 to 1.4 children per woman in 2025, reducing the user base. Faced with this, from CAIJ we maintain that there is something that no screen can replace: the cognitive, emotional, social, and motor development that physical play provides.

In response, the industry is seeing a shift in consumer preferences. Families are prioritizing educational toys, board games, puzzles, and building blocks, which are generally lower in cost and suitable for shared family play. Conversely, higher-priced items like ride-on toys, action figures, and remote-controlled vehicles have experienced more significant sales drops. Despite the challenges, the sector maintains hope for a rebound during the upcoming Children's Day.

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There is a deepening preference for educational toys, relatively low cost, and for shared family use.