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Business News/ News / Business Of Life/  The kidswear boom
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The kidswear boom

The market for children's fashion and luxury is fast becoming one of the most profitable retail segments

The recently launched Kids Around store in Delhi is looking to tap into the growing demand for high-end kidswear in India. Photo: Pradeep Gaur/MintPremium
The recently launched Kids Around store in Delhi is looking to tap into the growing demand for high-end kidswear in India. Photo: Pradeep Gaur/Mint

MUMBAI :

My son will only wear a T-shirt with a horse on it," gushes a mother outside a suburban Mumbai school. She quickly clarifies that it is the horse in the Ralph Lauren logo that her four-year-old is obsessed with. “He wants to wear exactly what his father is wearing," she adds.

Indians are increasingly spending more than they ever have on clothes for children. According to the Global Motherhood Survey by Frank About Women, a think tank set up by MullenLowe Lintas Group, Indian and Chinese mums are the only ones, globally, willing to stretch their budget to buy branded products for their children.

Increasing access, double-income households, brand consciousness and affordability have nudged out hand-me-downs and cheaper export-reject options. The indulgence isn’t limited to birthdays and special occasions, either.

Rahul Anand, co-founder of Hopscotch.in, an e-commerce site which curates a selection of kids’ brands, narrates how the firm bombards its users with “newness" each day, with 20 new, in-season collections on its site, to keep the interest going in kidswear.

In 2015, the retail value of the kids apparel market in India was pegged at 79,000 crore, according to industry estimates. “A large portion of the demand has been driven by Indian consumers shifting to the organized market," explains Shreyansh Kocheri, research analyst at Euromonitor International. He adds that the market for kidswear is expected to register a retail value compound annual growth rate of 15% to reach sales of 1.6 trillion by 2020.

The fact that India is one of the youngest nations in the world—29% of its 1.2 billion population is under 14 years, according to the World Bank—makes it an attractive market for brands.

“In the last three years, our company has seen an opportunity to dominate the (kidswear) segment with our brands that cater to the value, premium and luxury market in this space," says J. Suresh, managing director and chief executive officer (CEO) of Arvind Lifestyle Brands Ltd, which has brands like Gap Kids, Baby Gap, The Children’s Place, Nautica Kids, US Polo Kids, Flying Machine Boys and value chain Unlimited as a part of its portfolio.

“As of 31 March 2015, 7% of our total revenue of 2,729 crore was pulled in by kidswear. We expect this to rise to approximately 15% of overall revenues by 2018," he says. The company brought the $1.3 billion US speciality retailer The Children’s Place to India last year. The brand already has six stand-alone stores and six shop-in-shops; this number is expected to rise to 15 each by the end of this year—a number that it intends to repeat for the next three years.

In January, Mahindra Retail Pvt. Ltd, part of the $16.9 billion Mahindra Group, announced a tie-up with US-based children’s clothing, gifts and accessories firm Carter’s Inc. to bring the latter’s range to its chain of BabyOye stores across India. Recently, Pantaloons, part of the $41 billion Aditya Birla Group, also announced its entry into children’s wear with Pantaloons Kids, with plans for apparel and lifestyle stores for kids in big and small towns.

According to a Top of the Pyramid Report 2015 by Kotak Wealth Management, the number of ultra high networth individuals (HNIs) was expected to grow by 17% in FY15 to 137,100 and their wealth by 23% to 128 trillion. Interestingly, jewellery and apparel were the top spending categories for these ultra HNIs. Little surprise then that a clutch of brands including luxury labels like Gucci, Burberry and Armani among others see value in bringing kidswear to India. French chain Kids Around opened its doors in Delhi just early this month. The store will stock in-season collections from brands such as Hugo Boss, Billieblush, Billybandit, Little Marc Jacobs, Carrément Beau and Karl Lagerfeld Kids, among others, with prices starting at 4,000 for a T-shirt and going up to 18,000 for a
three-piece Hugo Boss suit.

“India is a great market for kids fashion. Parents have doubled their spending on kids, especially in the food, clothing, personal care, entertainment and e-learning sectors," says Sakshi Arora, director and CEO of Kids Around India.

The shift in the choice of merchandise for kids is an important part of the story. According to experts like Hopscotch’s Anand, millennial moms see kids as an extension of themselves. So, those who shop at Zara and H&M buy for their kids from there. “Parents want the latest fashion trends to be encapsulated," says Sundeep Chugh, CEO of Benetton India, where the kids category contributes to about 26% of overall sales.

What is seen in India, say experts, converges with global buying behaviour: sports-related motifs for older boys; dinosaurs and motor cars for toddler boys; unicorns, butterflies and fairies for toddler girls; and cute slogans like “Daddy’s Princess" for infants and newborns are big themes. It is not uncommon to see emoticons, with slogans such as “Selfie Queen", on clothes.

The other big trend is “mini-me". Brands like Next UK put out a full three-piece suit, with the exact same pocket square and tie for kids, as they do for adults. Similarly, brands such as Biba, Chemistry, Allen Solly and US Polo also put out similar lines for children, explains Mridumesh Kumar Rai, business head and chief operating officer of The Children’s Place, India.

“We get a lot of requests for theme-based garments," says Karina Rajpal, joint managing director at Kidology Design (India) Llp, which makes everything from cupcake dresses and mechanic overalls to princess gowns and “mini-me" outfits for moms and daughters. Since Kidology has positioned itself as premium, it focuses on adjustable features such as waistbands and straps for longer wear and non-abrasive pure cottons for babies, says Rajpal. Its hairbands and ties start at 500, with clothes going up to 25,000 for a customized designer gown by designers Gauri and Nainika.

E-commerce sites fuel this boom. “This year, out of the 40 brands participating in the fashion week, 25 are start-ups," says Manoj Mahla, director of Craftworld Events Pvt. Ltd, which organizes India Kids Fashion Week. He explains that online retail has allowed new brands and designers to reach out to consumers in metros and smaller cities as well.

Fashion designer Archana Kochhar launched a kidswear line at the India Kids Fashion Week in Mumbai recently. But she is not the only one, considering that well-known names like Sabyasachi Mukherjee, Masaba Gupta, Siddartha Tytler, Gauri and Nainika, Gaurav Gupta, Malini Ramani, Ritu Kumar, Namrata Joshipura, and Nandita Basu, among others, have begun to tap this market, albeit in a limited way.

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Published: 15 Jul 2016, 12:43 AM IST
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