Lego, Mattel and the future of the $109 billion toy industry’s addiction to plastic

The Teeter Popper balance board from Fat Brain Toys. Squishmallow plushies from Pokemon. The Rockin Record Player from Fisher-Price. Three of 2024’s most popular toys share little in common except for what’s inside: plastic.

The $109 billion toy industry is addicted to polyurethane, silicone, spandex, polyester and other forms of plastic: It’s included in 90 percent of the dolls, building blocks, action figures, science kits, playsets, toddler vehicles and other products designed to stimulate a child’s imagination.

That composition won’t change quickly, certainly not in 2025. Reducing virgin petroleum-derived plastic has proved difficult for toymakers including the world’s largest one, Lego, which in September extended the timeline for finding alternatives after testing more than 600 materials and finding none that met muster. Mattel is dabbling with bioplastics through baby toys sold by its Fisher-Price subsidiary and using recovered ocean plastic for certain Barbies.

The path forward for toymakers in 2025 will require both a deeper commitment to natural, bioplastics and recycled plastic materials that are durable, and the exploration of new business models including a more toymaker-centric approach to the sales of secondhand toys, according to industry experts.

“If we don’t make it easy for people to make a good choice, then what do we expect them to do?” said Sharon Keilthy, a former McKinsey consultant who founded the Jiminy Eco Toys online retailer (named after fictional character Pinocchio’s cricket friend).

Jury out on natural or recycled materials

Climate-kind toys are made from bioplastic, recycled plastic or certified wood or cardboard, but these products are difficult to find in traditional retail settings, said Keilthy. 

Jiminy, based in Ireland, sells toys made in Europe from these materials. It publishes a standard set of information about the products it represents, including these metrics:

• What it contains
• The origin of the raw materials
• The manufacturing site
• What its packaged in
• Whether it’s free of virgin plastic

Sales for non-plastic toys aren’t growing year over year, according to consumer research firm Circana. “There is an interest, but sales are flat,” said Frederique Tutt, global toy industry advisor at Circana, attributing sluggish adoption to consumers’ concerns over inflation.  

Many toy buyers have likewise been slow to embrace products that tout recycled plastic in their messaging, Tutt said, citing the Play for Future initiative launched by Italian toy company Clementoni in 2022. After struggling to find enough recycled feedstock, Clementoni is downplaying the value of a separate product line.

“They are transitioning to other materials but aren’t making a big deal out of it,” Tutt said, noting that most consumers are more interested in how companies are eliminating questionable materials from their core product lines. 

Durability wins

One of the most important considerations for U.S. parents under 40 making toy purchases is how long it will last, according to data from the Toy Association. Plastic’s durability is one reason both Lego and Mattel have been slow to move on from virgin plastic, according to toy designers.

“Any company that is making disposable toys is not going to be around for long,” said Ravi Sawhney, founder of RKS Design and designer of the first talking plush toy, Teddy Ruxpin. 

The product from the now-defunct Worlds of Wonder, founded by two former Atari sales executives, debuted in 1985 at a price of $100. “People bought it and kept it, even though some of the parts wore out,” Sawhney said. “We have an emotional connection with artifacts and experiences.” 

The toymakers consulting with RKS, including Lego, are prioritizing durability, and consumers are often willing to pay more for something that’s more durable. “They may buy less quantity for the sake of better quality,” he said.  

Durability is fundamental for potential plastic replacements. “We don’t understand what the alternative materials are yet,” said Michelle Lee, partner and managing director of the Play Lab at global design firm IDEO. “What I get excited about is not replacing plastics one-to-one, it is understanding the properties of the material so we can create new and better toys.” 

The fringe appeal of repairability and resale

Parents would much rather fix a toy than throw it away, according to Lee and Sawhney. One appeal of Mattel’s American Girl dolls is the “hospital” (now called the “care center”) that the company created when the product launched in 1988. A similar service was available for Teddy Ruxpin, primarily to address malfunctions of the product’s cassette player. 

“Repair should be a natural part of product ownership,” said Lee. “There is a desire from both kids and parents to extend the life” of toys.

There are many small and local businesses marketing toy repair. Three examples:

• KidsWheels, which specialized in parts and services for ride-on toys.
• Winey Bears, focused on stuffed animals.
• RePlay for Kids, offering training workshops. 

Until larger toy manufacturers embrace repair as part of their business models, it’s likely to remain a fringe concept, said Keilthy, who now consults with big toymakers. “We need to move on from current incentives that favor linear production,” she said.

The same is true of toy resale initiatives. Two prominent examples hail from France: 

• Rejoue (French) is a nonprofit that fixes toys so they can be passed along at their highest value. 
• The nation’s largest toy retailer, King Jouet, is planning to include secondhand products in about 10 percent of its 300-plus retail locations. The toys cost half the price of the new ones, and represent 20-30 percent of the assortment in participating stores.

Given the growing interest in thrifting among Gen Z, toymakers should consider establishing recommerce services, so they can benefit from this potential revenue and ensure that products being resold are checked for safety issues such as loose parts, said Lee. 

“It would be a chance for them to see value for their toys over and over again,” she said. “They could make sure that they’re passed along to families at the highest quality, and that they’re safe.”

[Join over 1,500 professionals transforming how we make, sell, and circulate products at Circularity, April 29-May 1, Denver.]