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Table of Contents

1.0 Introduction

2.0 Indian Kidswear Market:


2.1 Industry Overview
2.2 Market size and Growth
2.3 Characteristics of Kidswear Markets

3.0 Growth Drivers:


3.1 Demography
3.2 Untapped market potential
3.3 Media Proliferation

4.0 Success Factors:


4.1 Fashion Innovations
4.2 Brand Building
4.3 Visual Merchandising
4.4 Pricing

5.0 Major Players:


5.1 Gini & Jony
5.2 Lilliput
5.3 Allen Solly
5.4 ZAPP

6.0 Conclusion
1.0 Introduction:

Scanning through the streets of any town or city, one can see a mind boggling array of kids apparels.
Spaghetti tops, Crystal studded denims, Italian cuts, Capris, and exclusive party wears. Kids fashion is a
diminutive version of adults wear. They have all the clothing as like that of adults, and even much more.
Children of today are much more intelligent than their previous generation. They like to have their own
choice of clothing. This metamorphosis of children; becoming independent buyers is enhancing the kidswear
market. Double income, increase in the amount of disposable income, and one or two kids are the
supporting factors to the growth of the kidswear market.

Global kidswear market during 2006 was estimated to be around US$ 163.92 billion, which was a small
contribution of 3.6% of the total clothing industry. Kidswear segment of the Asia-Pacific region is 35.1% of
the global market, and is considered by industry analysts as one of the fastest growing segment, due to
increase in child population, supported by many other factors.

2.0 Indian Kidswear Market:

Good times for the Indian kids apparel market are in the offing. The evolution in the buying behavior of
children, and their influence over their parents results in a big difference in purchase decisions. Media
exposures and promotions also cause a significant influence in the market. Evolving dynamics in this market
have made it necessary for the manufacturers and retailers to evolve their business strategies’ in order to
sustain themselves in the market. Many manufacturers come up with their own brands, while some others
enter into business through joint ventures.

Today’s kids are more fashion conscious, and are ready to experiment with clothing. Increase in the amount
of disposable income, and retail blitz has brought a sea change in the Indian kids apparel market. With
kidswear being considered as a part of the lifestyle segment and a strong emphasis is being placed on
brands, this segment proves to be a potential business.

2.1 Industry Overview:

Market for kids apparel is the fastest growing industry in India. Manufacturers are coming
up with fancy materials targeting kids who are more interested in the upcoming fashion
trends. Children’s garments are available in various forms and designs. Kids apparel
market is more unorganized than any other segment of apparels. The market is a
proposition of the good, bad and the ugly. A huge volume of kids apparel in India is being
dominated by local and unorganized players. This gives an excellent opportunity for the
organized players to lay a strong foundation in this segment. Indian market is now moving
towards an international look in terms of children’s apparel. Cotton plays a major role in
the clothing of children. Approximately, 86% of the kidswear are of cotton.

Branded kids apparel market is in its nascent stage in India with a handful of national and
international brands. Industry analyst estimate that market size of branded kidswear in
India including brands like Ruff Kids, Ruff Baby, Planet Kids, Gini & Jony, ZAPP, Li’l
Tomatoes, and Weekender Kids is estimated to be around Rs 1,000 crore. They
positively assert that branded market for kids is growing at 15% per annum. International
brands including Barbie, Mothercare, Benetton Kids, Pepe, Lee Kids, Tommy Hilfiger, and
Adams Kids have also entered the Indian market.
2.2 Market size and Growth:

According to the India Apparel Report, 2008 (Images Year Book, Vol IV), the size of kidswear market is
estimated to be at Rs. 30, 510 crore. Industry experts predict that the market will further grow to reach Rs.
45, 000 crore by 2013, with braded apparels contributing to a major share. The volume of market share of
kids apparels in the total apparel market is at 24.9%, as against a 15% share in 2005. Urban kids apparel
market comprises about 60% of the total kidswear market. A research states that more than 30% of the
country’s population is below 15 years of age. The density of population makes kidswear to be one of the
fastest growing segments in the Indian market scenario.

Market share of the Major Apparel Segments (2007)


Total size Rs. 122, 400 crore

Branded kidswear are well established in I tier cities, and are now experiencing a good growth in II & III tier
cities as well. Wanting the best outfit for their children, parents are seeking a variety of garments offered by
new brands, and are shopping in exclusive outlets dedicated for children’s apparel. Industry players further
predict that the market is set to grow by 12% annually and reach its peak by 2010.

2.3 Characteristics of Kidswear Markets:

The market for kidswear is classified as follows:

ƒ Infants (0 - 6 months)
ƒ Toddlers (7 months - 2 years)
ƒ Kids (3 - 8 Years)
ƒ Pre-teens (9 - 12 Years)

Children’s wear is mainly on a seasonal basis. Highest sales figures are usually recorded during the months
of August – September. The average annual expenditure on kidswear is approximately Rs. 3, 857.

Average budget for kids apparel


For children’s wear, cotton is the most preferred material due to its non-allergic, comfortable, and easy
caring virtues. But with the advent of more and more fads emerging in the market, this fibre faces
competition with other synthetic ones, which are preferred for its washability, and non-creasing abilities.

3.0 Growth Drivers:

Children always keep growing. So, the possibility of this market being strong even in tough times is evident,
as there is always a demand for kids apparel.

3.1 Demography:

A survey states that, the maximum sales in children’s wear market comes from smaller towns. Patiala,
Bhatinda, Coimbatore, Phagwara, and Sonepat are a few to name. Branded wears are well established in
tier I cities and are now emerging into the II tier and III tier cities as well. In I tier cities, boutiques are
emerging to be a popular trend. Consumers expect these retailers to have a cutting-edge of garments, and
exclusive collection of clothes.

Generally stores that offer a wide range of selection at discounts and low prices attract more traffic. As kids
grow quickly, and are less attentive in keeping their clothes safe, parents consider kids apparel as functional
and disposable as well. In case of infant, and toddler wears, general merchandise, and supermarkets
dominate the sales. Specialty stores are successful in this segment as they are focused on a particular
section in the apparel segment. Few retailers dominate the kids apparel market in any one particular area.

3.2 Untapped market potential:

With a promising future for kids apparels, the market has attracted international brands into
India. Global brands like Mothercare, Mona Lisa, Benetton, Espirit, Bossini, and Kans
have entered the Indian kids apparel market. While international brands eye Indian
kidswear market, domestic brands like Lilliput, Li’l Tomatoes, and Catmoss are gearing
up to have a share in the global market. Representing Indian brands abroad, higher
profit margins, and succulent opportunities are assumed to be the reasons behind
their foreign march.

India has a vast potential for export of kids apparel to foreign markets like
US and EU. Brands like Lilliput and Koutons are exploring
opportunities for joint venture options to tap the children’s apparel
market in China. Indian players spot lucrative manufacturing
capabilities in China, supported by strong purchasing power.
Hence, Indian business units are planning to acquire manufacturing
units in China to gain production scale for its operations in the ‘dragon nation’.

3.3 Media Proliferation:

A brand; positioning itself in the market, depends on the level of differentiation it is able to establish. The
manufacturer must also ascertain a sizable amount of promotional budget to gain eyeballs. There are no
boundaries for the scope of merchandising activities for kidswear. With the effective publicity of mediums like
TV channels, video games, blockbuster of superheroes, and peer influence, children are aware of the latest
fashion in apparels, and other accessories.

Generally parents like to dress their children like themselves. They further seek to buy brands they are
already aware of, and have confidence in. Popular brands like Gap, Diesel, and many others plan to extend
into this segment. With the emergence of many TV channels, promotional strategies of companies have
become more intense. Innovative promotions which encourage the kids involvement, finds more acceptance.

4.0 Success Factors:

Craving for a niche, new entrants as well as existing players follow distinct strategies to market their brand.
Marketing task lies in capturing the imagination of the children with fashionable patterns, and of the parents
with quality apparels supplemented by reasonable prices. All these determine the success of the
manufacturer in this segment.
4.1 Fashion Innovations:

The practice of dressing girls with a frock and boys with shorts are way beyond. New pattern of garments in
par with the latest fad is being sought by parents. Fashion industry is boosting up the ‘well dressed child’
trend with their new collections on the runways frequently. Kids apparel manufacturers make optimum
utilization of latest trends in the fashion world to entice the kids and increase their sales. With wishes and
demands getting added in the list of kids, manufacturers and retailers are making the most of it. Factions of
domestic and international players are seen in the arena, with each of them wanting a slice in the pie.

ƒ Use of cartoon characters in kid’s garments: Apparel manufacturers are


cashing on the popularity of cartoon characters. ‘Character inspired
merchandising’ is emerging as one of the hottest market trends. Mickey
Mouse, Powerpuff girls, Spiderman, Superman etc. have all found their way
into the kidswear market and are currently selling like hot cakes in the market.
The type of cartoon character used in the apparel depends mainly on the
popularity of the toon, their age group, and sex of the children.

ƒ Coordinated Accessories: This season’s style statement includes dressing up with accessories,
where everything from dress, bag, and hair clip is color, and design coordinated. In the current
trend, leather bags, caps, key chains, and hair bands are considered as ‘required’ with an ensemble.
Especially in case of branded apparels, garments coordinated with proper accessories sell well in
the market, than individual apparels. The price ranges for such apparels are extravagant.

4.2 Brand Building:

As apparel markets are growing in size rapidly, kids of today have a vast range of options to choose from.
So, it becomes necessary for the manufacturers, and retailers to woo the offspring’s and convince them to
make the buying decision. Brands approach kids to market their product focusing on unique colors,
silhouettes and prints just as for adults.

Specialty shops are now an emerging trend for kidswear. Every brand tries to create a discrete brand
identity through its merchandise and in-store arrangements. Raymond’s brand Zapp has an exclusive kids
loyalty programme. Reebok has a ‘Made to Play’ campaign. They have specific sports wears like Cricket,
Football, and Basketball collections. This is done keeping in mind that kids are more attracted towards
playing. Peter England has set up a customized space for kids.

4.3 Visual Merchandising:

Trends have changed, and it is quite visible. Children, who were taken to
parks and zoos before, are now coming along with their parents for
buying their own clothes. So, the retailers who want to take a pie of the
cherry should focus on attracting the attention of children along with their
parents. They can thereby ‘Capture the child’s mind and the parent’s
wallet’. Kids exhibit considerable ‘pester power’ while shopping for their
clothes.

Good store presentation and product merchandising is like a good book


that has an attractive cover, and an interesting first chapter that would
lure the viewer. Big departmental stores have segregated their apparel
categories like infant wear, ethnic wear, casual wear and preteen wear
etc. They store a wide assortment of apparels and distinguish them with
each other. Some retailers and department stores have taken the lead in
creating an in-store arrangement with play areas, and kids oriented
promotions within the store. Ex: ‘Back to School’ promotion by Lifestyle.

4.4 Pricing:

Kids apparel market is a price sensitive segment. Higher input costs add to the prices of the apparels. With
the increase in the purchasing power of parents, it is expected that they will sustain the business in the long
run. As kids have the tendency to grow up very quickly, new offerings are required. This raises two concerns
one of range, and second of pricing. An effective combination of both determines the future of the brand.
Deciding the price of the apparel mainly depends on defining the target group and identifying buyer
behavior. The price of garments in I tier cities, and exclusive outlets will have a vast difference than that of
the clothes sold in normal retail outlets and II & III tier cities.

5.0 Major Players:

Indian kids apparel brands are creating a niche by themselves by changing the face of Indian kids wear in
India. Fibre2Fashion had exclusive one on one interview with prominent kidswear brands. These brands
dominate the kidwear market in India and have earned consumer confidence trust and loyalty towards the
brand, thus earning laurels from its consumers.

5.1 Gini & Jony:

Gini & Jony has a range of brands like GJ Jeans, Palm Tree, Levi’s Sykes
Junior, Red River, UCB, Rocky S, and GJ Knowledgewear for kids. They
offer a wide range of apparels for children including T-shirts, shirts,
jackets, cargos, jeans and trousers for boys, and capris, dungarees, skirts,
Jamaicans, and co-ordinate tops for girls. In an exclusive one on one
interview with Fibre2Fashion, Mr. Anil Lakani, Executive Director, Jini &
Jony, shares his thoughts about the kidswear segment.

How does the Kidswear segment differ from Menswear and Womenswear?

For a kids wear brand like ours, we clearly differentiate our buyers into Consumers (Kids) &
Customers (Parents). The styling, trend and acceptability of the merchandise is not as Subjective in
the Men’s & Womenwear as in the Kids segment. Kids segment is highly dynamic as kids get
inspired from Men`s wear & women’s wear, celebrities, sportsmen, bollywood and others. As the
buying process involves more than one person’s decision, the variance in the purchase patterns are
higher as compared to the other two segments.

How do you think has the Kids-wear market has evolved during the past decade?

Looking at the past, there were not events/ activities in a kid`s daily schedule. But the new age kid
today goes for dance class , tuition ,guitar classes, camping’s , etc. and they like to have dressing
for each event / activity , therefore the demand in the kids segment has risen over the decade with
significant change in the lifestyle of the kids . Such an opportunity has attracted many brands and
our customers today have a range of products and brands in their offering.

Where do you see the market, 3 to 5 years from now?

The Longer term horizon of the Indian market is still promising and with increase in consumer
awareness, better exposure to world fashion, need for a better retail experience has given rise to the
number of organized retailers. Also with the change in the lifestyle and consumption pattern, the
Organized kid`s wear market looks promising.

5.2 Lilliput:

When conversing about the Kidswear segment, Ms. Sapna Gupta, Brand Promotion-Marketing, Lilliput
kidswear Limited, focused on the unique characteristics of children’s apparel, and addressed about its
evolution. She also predicts the market scenario in the years to come.

What features distinguish Kids wear segment from Menswear, and Womenswear?

“Designing for kids is very different from designing for adults. Kids are a very sensitive target
audience that needs to be pampered every now and then. For kids, brand names are not the only
factor; kids talk about the style, physical attributes of the product, colors, look etc. It is the whole
package that works for the kids – they need to be pulled at all levels to get them to try a brand and
stick to it. Dungarees, shorts and shirts are the evergreen fashions in kids' apparel. Short skirts, tops
with puffed volume, halter tops, lace trims and cropped trousers are the in things in the world of
children's apparel in today's times. Moreover, designing for kids is probably one of the toughest jobs,
as they are in this transient phase and their psyche at every age has to be mapped and their
wardrobe designed accordingly. Boys and girls of the same age have a very different orientation
towards fashion. Designing for 7-8 year olds is very different from designing for 11-12 year olds. The
latter being at a stage where they identify themselves the most with sportspersons, celebrities and
superheroes. So attitude and individualistic style is an essential component of the clothing.
Further, one cannot compromise on the quality of the fabric; in fact one has to be even more
stringent when it comes to kids – non-abrasive, easy iron clothing, low formaldehyde content are a
few basic benchmarks one has to adhere to.”

Next, Fibre2Fashion asked about the market evolution during the past decade and the growth
drivers that manipulate the kids apparel market.

“Initially, in India, the trend was that many people preferred buying
functional kids' apparel rather than branded ones. Children's garments
were usually purchased from small stores and from street shops, while
branded garments were only bought by the elite section of the society. This
trend has been gradually changing and the market for branded kids' clothing
is growing. According to industry estimates, the Kids apparel market is
divided into organized and unorganized segment which exceeds Rs. 17,000
crores, of which Rs.3000 - 4000 crores is constituted by branded Kidswear.
It's growing @ 25% p.a. which makes it one of the fastest growing markets.
Further, both in India and abroad, with the development in technology, the
world is becoming increasingly smaller by the day. Kids of today belong to
the screenage (TV, internet, mobile etc.) and thus are more aware of the
latest trends and fashion.

These factors are the major drivers in the growth of the Kidswear
segment, be it in India, or abroad. No wonder, so many men / women
apparel brands off late have started seeking Kidswear as the next big
thing and streaming their business in the Kidswear as well.”

How do you foresee the market scenario, 3 to 5 years from now?

“As the branded Kidswear market in India is still in its promising stage thus it provides immense
business opportunities both for the existing as well as new players. The industry will witness the
entry of many international players thus making the segment more lucrative. Moreover, seeing the
huge potential that the industry offers; many apparel brands have started diverting their revenues to
the Kidswear segment. Thus, in the coming years, the Kidswear segment will see an upward graph
of profitability, opportunities and employment.”

5.3 Allen Solly:

Wanting a bigger slice in the market share, Allen Solly has announced the launch of kidswear, a funky, cool,
fun and stylish collection. While commenting about the market, Mr, R. Satyajit, COO, Allen Solly says, “The
organized kidswear market, excluding school uniforms, is estimated at around 2,000 crores, growing at 30%
every year. The kidswear market is among the fastest growing segments in the apparel industry and Allen
Solly aims at playing a key role in the branded Kidswear segment.”
Allen Solly has launched its apparels in four collections namely: ‘Colour My World, Urban Holiday, Sports
Academy and Enchanted’ being built around the numerous occasions in a child's life. While taking about the
quality of apparels, Mr Satyajit states that, “90 % of the merchandise is made of 100 % cotton fabric, which
is most comfortable for Children. Strict quality parameters have been followed while designing these clothes
including testing for saliva and perspiration color fastness. An attempt has been made at making the
merchandise child safe for e.g. care has been taken to not provide any drawstring around the neck and
wherever it is included - it confirms to specified length.”

5.4 ZAPP:

While international players are entering into the Indian market, and many others, waiting at their wings;
seeking entry, domestic apparel brands are extending products for kids. Raymonds, which offer exclusive
menswear, launched its kidswear collection in the name ‘Zapp’. It is an integral section bringing fashion to
kidswear. Their target customers are kids in the age group of 4 -12 years. Zapp also has a tie up with
Warner Brothers to treat the kids with Superman apparels.

6.0 Conclusion:

Clothing signifies an individual state of mind and the wearer’s economic status. This is visible ‘crystal clear’
in the kidswear market. Parents crave that their children should dress as well as themselves, and even in a
better way. With new players entering the kidswear segment, and heating up the market, old players are
pepping up their merchandise, and providing attractive offers and services to charm the customers. Based
on the analysis and interpretation, this report draws the following conclusions:

ƒ There is a high potential for children’s apparel in India both in terms of branding and specialty
retailing. However, their success depends on the extent of their product differentiation and retailer
experience.

ƒ Branded apparel is in its nascent stage in India. Industry experts positively assert that branded
market for kids is growing at 15% per annum. Along with domestic brands, many international
brands are also entering into the Indian market.

ƒ Marketing of kidswear brands in India is still in the budding stage in India, as very few brands exist,
and there is lack of brand orientation amongst customers. Majority of the kids apparel advertising is
being targeted mainly on women.

ƒ Manufacturers and retailers follow appealing marketing strategies to charm the kids as well as their
parents. Much focus is placed on in-store arrangements, keeping pace with the interest of kids.
Toon inspired merchandise and having special kids oriented promotions are a few to name.
ƒ Media plays a major role in influencing the purchase decisions of kids. Effective publicity of mediums
like TV channels, video games, blockbuster of superheroes help to boost the kids apparel market.

References:

1) “Pester, Power, Ahoy!”, Richa Bansal, Images Business of Fashion, Vol IX, No X, October 2008.
2) http://www.drapersonline.com/
3) http://www.deccanherald.com
4) http://retailia.blogspot.com
5) http://www.financialexpress.com
6) http://economictimes.indiatimes.com
7) http://www.babyshopmagazine.com/