With one-fourth of the Indian population being below sixteen years of age, growth potential in the kids clothing segment is immense. Also, 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.
According to a recent study by ASSOCHAM, the children’s apparel market in India is expected to grow from Rs 72,000 crore in 2014 to Rs 95,000 crore by the end of 2016, growing at a compound annual growth rate (CAGR) of about 20%. By 2020, the market for kidswear is expected to reach sales of Rs.1.6 trillion. As per a report by Technopack, kidswear in 2013 contributed to 20% of India’s apparel market and this share is expected to increase to 22% by 2023.
Significantly, Indians are increasingly spending more than they ever have on clothes for children. Indian mothers are actually ready to stretch their budget and buy the best of clothes for their children. Key factors which are leading to a much higher spending on kids’ clothes include increasing access to new and fashionable designs, double-income households, brand consciousness and affordability. Also, with lot of cheaper export-reject options available, demand for kids clothing in the country has increased manifold.
There was a time when buying clothes for kids was occasion specific – clothes were bought for birthdays, festivals or marriages. Today, the indulgence is not limited to these occasions.
A significant portion of the demand for kids’ clothes is today driven by Indian consumers shifting to the organised market. There is a huge opportunity to thrive in the kidswear segment as more customers demand brands that cater to the value, premium and luxury market in this space.
Key brands in the kids clothes segment include Gap Kids, Baby Gap, The Children’s Place, Nautica Kids, US Polo Kids, Flying Machine Boys, value chain Unlimited, Max, Nauti Nati, 612 League, Archana Kochhar, The Children’s Place, A Little Fable, Sheena Luxury, Kilkari, Biba, among several others.
A significant factor for the growth in kids’ clothes segment can also be attributed to the growth of e-commerce companies such as Amazon, Flipkart, Firstcry, eBay, Hopskotch, etc which offer multiple designs and options at reasonable prices – usually offering discounts. Rahul Anand, co-founder of Hopscotch.in, an e-commerce site which offers a selection of kids’ brands, shares his firm’s strategy on how the firm offers its users “newness” each day, with 20 new, in-season collections on its site, to keep the interest going in kidswear.
Traditionally, the kids’ clothes market was dominated by unorganised players who offered a wide variety of styles at low prices. This has changed over the years – the market today more related to branded clothing, which is becoming the popular option for kidswear. Many domestic and global companies are extending their portfolios, and expanding their geographies, so as to capitalise on the growth of the kidswear market in India.
Across both clothes for boys and girls, denim remains the fastest growing category. Children as well as parents consider denim fabric and style more fashionable as well as wearable. Most sold items in the boys segment include T-shirts and bottom wear, whereas in the girls’ segment, ethnic wear and dresses dominate the segment.