Dec. 12 (Bloomberg) -- Santa knows who’s been naughty and who’s been nice. This year, he’s rewarding couples who want to be both.
Spurred by the global sensation of the “50 Shades of Grey” bondage trilogy -- among the bestselling books of all time in Britain -- sex toys featured in the tale are leading to a flush Christmas for the adult novelty industry as Europe’s retailers struggle to keep up with demand for leather-covered spanking paddles and blindfolds featured in the novels.
Just as “Sex and the City” made the Rabbit vibrator an acceptable household appliance for single women more than a decade ago, the erotic novels’ popularity has made restraints and so-called love balls acceptable stocking stuffers this year.
“One of the important things is that 50 Shades transcends sex toys in terms of the impact on relationships,” said Nick Hewson, head of Hewson Group, which does market research on women’s products. Bondage, domination and sadomasochism, “tends to be a couples activity. You need at least two people there.”
The $2 billion industry, which has grown between 5 percent and 10 percent annually in the past decade as retailers went upscale and targeted women, will expand at the top end of that range this year, according to Hewson. It could exceed 15 percent next year due to the ripple effect of “50 Shades,” Hewson estimates.
Lovehoney, Britain’s No. 1 online retailer of erotic merchandise, is betting on that expansion. It won the rights to produce and sell a range of “50 Shades” branded sex toys everywhere except the Americas. The line of 20 products, including vibrators and bondage kits, was introduced in time for Christmas and endorsed by the book’s author, E.L. James. Prices start at 11.99 pounds ($19.32) for blindfolds, a feather tickler or a “vibrating bullet” and rise to 54.99 pounds for the “Submit to Me” bondage kit.
Lovehoney, which reported sales of 15.9 million pounds in the fiscal year ended in March, estimates the line alone will generate 10 million pounds in revenue in its first year on the market.
Lovehoney, also the official distributor of “50 Shades” products to other retailers, sold out its first production run within days of the line’s Nov. 12 introduction. It’s seen booming sales of products such as 24.99-pound “Inner Goddess” silver pleasure balls like those that the lead character, tycoon Christian Grey, tries on Anastasia Steele, the book’s heroine.
“‘50 Shades’ has had an incredible effect on business,” said Lovehoney co-founder Richard Longhurst. “It’s given couples permission to enter the market” and told them “that buying toys is all right.”
That’s good news for sex merchants at the second-busiest time of year for the industry (only Valentine’s Day is a bigger draw). Shares of Beate Uhse AG, a publicly traded German adult retailer, are up 171 percent this year as a stronger focus on women helped it reach an operating profit in the first nine months of 2012 after two years of losses.
“We see that we sell more S&M articles, such as little whips and handcuffs,” said Chief Executive Officer Serge van der Hooft. “That’s really due to the book.”
The retailer, which doesn’t have a license to use the book’s name for its products, has nonetheless gathered the ones most often used by Grey to dominate Anastasia and displays them together. The best-selling products include love balls and the We-Vibe vibrator for couples, Van Der Hooft said.
The chain is sending actors dressed as Christmas angels onto the streets of German cities to advertise the shops and will open more outlets focused on women and couples next year in Germany, the Netherlands, and Belgium.
“If people don’t have the money for a holiday or a television, they search for little things to enjoy life more without too much investment,” Van Der Hooft said. “Our products are very good for that.”
Hewson says growing acceptance of sex goods will also benefit more upmarket products such as those made by Sweden’s Lelo, which sells the $159 Tiani 2 couples toy, and Jimmyjane, producers of Little Something precious metal vibrators, including a $3,500 diamond-and-platinum version. Such high-end sex products currently represent only about 7 percent of the market by value, Hewson estimates, leaving plenty of room for growth.
“If you work in the City and make good money, how would it look if you went into the special part of your cupboard and had something ugly?” said Allison England, a saleswoman at Coco de Mer, a chain of British lingerie and luxe sex toy boutiques that also has a shop in Manhattan. Consumers who wear bespoke suits and drive expensive cars want to impress in the bedroom too, she says.
Another trigger for growth in coming months could be the end of the holidays. According to Renee Denyer, a manager at London shop Sh!, which sells a range of “50 Shades” merchandise, sex-toy sales usually spike again following Christmas as people look for distractions after prolonged periods spent with their relatives.
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