Children’s Apparel Industry Overview U.S. Children's Apparel Sales

Transcription

Children’s Apparel
U.S. Children's Apparel Sales
by Distribution Channels
Industry Overview
Mass
merchandisers
29.7%
Specialty
retailers
24.3%
Children’s apparel represents nearly 20% of the U.S.
retail apparel industry. Within the segment, sales of
infants’ and toddlers’ apparel accounts for a greater
percentage of all children’s apparel than do sales of
boys’ or girls’ clothing.
Other - 2.7%
Mail/e-tail - 2.3%
Off-price retailers/
outlets - 8.2%
National chains
22.8%
U.S. Apparel Sales, by Market Segment
% of $165 Billion in Retail Sales
Department
stores
10.0%
Source: Children's Business, "Industry Market Report Card," May 2004.
Women's apparel - 53.6%
Children's apparel - 17.8%
Men's apparel - 28.6%
Children's Apparel:
$29.4 Billion
Infants/
toddlers
36%
Girls' - 34%
Boys' - 30%
Source: Children's Business, "Industry Market Report Card," May 2004.
Department stores and independent specialty stores
were once the principal places parents shopped for
clothing for their children. In recent years, department
stores have lost substantial market share to mass
merchandisers like Wal-Mart and Target.
Specialty stores continue to maintain an important
presence in the industry -- though they, too, have lost
sales to mass merchandisers as well as to national
chains. They still hold nearly a quarter of the market
share for children’s clothing, behind mass
merchandisers but still ahead of national chains, as
illustrated in the following chart:
Within the last decade, numerous national chains that
sell adult apparel launched spin-off chains that
specialize in children’s clothing. They are often located
in malls right next to their adult counterparts, and the
name recognition has fueled tremendous growth for
these stores. Some of the biggest names include:

GapKids/BabyGap - 1166 stores
Limited Too - 553 stores
Babies R Us - 199 stores
abercrombie* - 167 stores
Talbots Kids - 68 stores
Guess Kids - 83 stores
Benetton Kids - 28 stores
Other important national chains include The Children’s
Place, with 691 stores in the U.S., and Gymboree,
which operates 619 stores.
Off-price retailers, also known as discount retailers,
include national chains such as T.J. Maxx, Marshall’s,
Ross Dress For Less Stores and Loehmann’s. These
retailers, like department stores, carry men’s and
women’s clothing as well as children’s wear. Factory
outlet malls are also an increasingly popular option for
price-conscious parents looking for fashionable clothes
for their kids. Osh Kosh B’Gosh, a well known manufacturer of children’s clothing, operates 165 companyowned stores in factory outlets across the country.
* The “a” is intended to be lowercase.
4.1
Issues and Trends
Children’s clothing has been the darling of the retail
apparel industry for several years, according to an
article in Apparel Magazine (November 2004). Unlike
other depressed segments of the industry, children’s
clothing sales have increased every year since 1998,
with the exception of the 2001 holiday season that
followed the September 11th terrorist attacks.
Led by girls’ apparel, the overall sales of children’s
clothing between August 2003 and July 2004 grew to
$29.1 billion, a 1.7% increase of $28.6 billion from the
previous 12 months.
Some of the biggest business trends in the children’s
apparel industry follow:
A heavy injection of fashion has stimulated sales and
brought a renewed sense of excitement to kids’
clothing. Fashion trends driving children’s apparel
include the following:
Children’s Apparel Fashion Trends

Children’s fashion mimics adult wear. With parents
and children across multiple economic lines becoming
more fashion savvy, children’s apparel trends are
increasingly influenced by adult fashions. The market
has become characterized as a peculiar cross-section
of more contemporary yet conservative styles with
edgier, urban looks.

Celebrities in the mix. Madonna recently announced
she will launch a children’s clothing line at Nordstrom,
with fashions inspired by her children’s book, The
English Roses. Celine Dion is also designing a line of
children’s wear.

Baby boomers splurge on the grandchildren. Stylish
boomers, the oldest of which are approaching 60, have
paid for their children’s college tuitions and weddings
and are now looking to lavish attention on their
children’s children. A growing number of specialty stores
are marketing to these grandparents -- many of whom
can afford to spend $350 on cashmere baby blankets
and $100 or more for Dolce & Gabana footwear for girls.

Unusual accessories are in. With more schools
enforcing dress codes, makers of student gear are
taking advantage of the situation by tempting kids with
self-expressive accessories, including zebra-striped
combination locks and calculators with interchangeable
and colorful face-plates.
Children’s Apparel Industry Trends

Specialty retailers and second-tier department
stores gain ground. Sales for specialty retailers for
children grew an impressive 17% in 2003. Even more
surprising, though, is that sales in second-tier
department stores like Sears, J.C. Penney and Kohl’s
grew 19% in 2003. These stores, which focus more on
reasonably-priced clothes than do higher-end department stores like Saks and Macy’s, have noted the
recent success of children’s clothing -- and have
focused on improving the shopping experience within
their kids’ apparel departments.
Sears joins with Gerber. Sears has honed in
specifically on the infant-toddler market. The chain
joined forces with Gerber to add a line of baby clothes
and accessories called Gerber Beginnings. The line
will include gowns, bibs, blankets, cap and bootie sets,
coordinated pants and jackets, and “sleep’n’play”
outfits. The stores are also removing clutter by cutting
15% of the clothing racks from the children’s department so parents can better maneuver strollers down
the aisles.
The Children’s Place races ahead. The Children’s
Place is currently the fastest-growing chain in the
industry. The chain’s net income increased 158% in
2003. Customers have responded to the company’s
philosophy of providing everyday value with highquality merchandise. In late 2004, the company
announced it would buy the Disney Stores chain, which
operates 335 stores nationally.
Consumers still demand lower prices. Despite
overall growth in children’s clothing, pricing remains a
big issue. With the economy still recovering, consumers remain on the lookout for bargains. Parents will
often hold out for sales before buying clothes for their
kids. Higher-end department stores have begun
clearing out excess brand names in favor of more
attractively priced private labels.
Sources for Industry Trends and Fashion Trends: Women’s Wear Daily,
November 11, 2004; Apparel, November 2004; The Columbus Dispatch,
August 27, 2004; The Wall Street Journal, August 24, 2004.
Despite the popularity of specialty stores, mass
merchandisers dominate the list of the nation’s highestvolume retailers of children’s clothing:
Retailer Name
# of S tores
2003 sales*
Wal-Mart
2,949
$7.8 bi lli on
Target
1,225
$2.2 bi lli on
Sears
871
$1.7 bi lli on
1,049
$1.5 bi lli on
Old Navy
840
$1.4 bi lli on
Kohl's
542
$1.3 bi lli on
K-Mart
1,511
$1.2 bi lli on
GapKi ds/BabyGap
1,166
$1.1 bi lli on
Federated**
458
$1.0 bi lli on
Marmaxx***
1,418
$1.0 bi lli on
J.C . Penney
*Total company sales; does not solely reflect revenue from children’s apparel.
**Company includes Macy’s and Bloomingdales department stores.
***Company includes Marshall’s and T.J. Maxx stores
4.1
Value of Products and
Services in the Industry
The amount spent annually on children’s clothing can
vary dramatically from household to household -- from
under $25 to several thousand dollars. According to
NPD FashionWorld, the average price of one piece of
clothing dropped from $6.02 in 2002 to $5.92 in 2003.
Families typically spend more on girls’ clothing than
boys’ clothing, according to Household Spending: Who
Spends How Much on What (December 2003). Below
is a chart illustrating the average household spending
on specific girls’ apparel items.
Critical Success Factors
CSFs for Children’s Apparel Stores

Create an uncluttered shopping experience.
Avoid stuffing racks too full with clothes.
Organize the store so it feels spacious and
easy to browse.

Define your target market: Does the store
appeal to bargain-shoppers looking for
quality? Is it a specialty store for well-heeled
parents and grandparents? Always keep the
targeted shopper in mind when buying
clothes with which to stock the store.

Focus on unique brands to differentiate the
store. This becomes ever more important as
retailers in every segment, including mass
merchandisers, carry designer labels.

Hire warm, patient sales people who like
children and know how to gently handle
harried parents.

Capitalize on the opportunity to become a
destination for gift-givers, particularly for
newborns.
Girls' Apparel Sales
by Type of Clothing
Skirts and pants
$23.61 - 19.1%
Dresses and
suits - $13.83
11.1%
Active
sportswear
$12.09 - 9.7%
Shorts
$8.83
7.1%
Skirts, blouses and
sweaters - $29.37
23.8%
Other
$28.40
22.9%
Accessories
$7.66
6.3%
Source: Household Spending: Who Spends How Much On What,
New Strategist Publishing, December 2003.
According to Household Spending, the average family
spends $107.28 on children’s clothing -- $123.79 for
each girl, $90.77 for each boy.
Spending varies dramatically depending on household
income and age of the primary householders.
Households with an income under $10,000 spend an
average of $24.67 on boys’ clothes and $49.75 on girls’
clothes, while households that earn $70,000 or more
spend an average of $167.04 on boys’ clothes and
$216.57 on girls’ clothes.
Not surprisingly, consumers ages 35 to 44 spend the
most money on children’s clothing, which averages
$206.88 -- $177.20 per boy, $236.57 per girl.
Consumers ages 25 to 34 spend $108.96 for each boy
and $146.09 for each girl in the family.
Sources: The Record, February 27, 2004; Children’s Business, May 2004.
Industry Resources
American Apparel & Footwear Association
1601 N. Kent Street, Suite 1200
Arlington, VA 22209
703-524-1864
www.apparelandfootwear.org
National Retail Federation
325 7th Street NW, Suite 100
Washington, DC 20004
202-783-7971
www.nrf.com
Children’s Business
Fairchild Publications
7 West 34th St.
New York, NY 10001
212-221-9595
www.childrensbusiness.com
NPD Group
900 West Shore Road
Port Washington, NY 11050
516-625-0700
www.npd.com
4.1
Background

Media Marketing, Inc., creators of imMEDIAte®
software, has been in the forefront of sales
presentation systems since 1987. The
imMEDIAte suite, a state-of-the-art consultative
system, is used by hundreds of media reps
every day to create compelling presentations
and expert media proposals. Built on Microsoft
Office® technology, the imMEDIAte system
provides a complete solution to your media
sales needs.
Media Marketing is the exclusive distributor of
Profile America’s IndustryIQ reports. Sales and
marketing teams embrace these industryknowledge reports because of their concise,
easy-to-read style and rich store of information.
Regular use of IndustryIQ reports creates a
relationship-building, consultative environment.
Values and Benefits

Sales reps want to be smart about advertisers’
industries, but face the realities of limited time
and resources. They need to track dozens of
different industries, and value these concise,
easy-to-use sales tools that they can leave
behind with their advertisers.

Likewise, managers want reps to be confident,
professional and informed. They want their
reps viewed as partners, not vendors -- and
they appreciate the IndustryIQ method of
collecting, analyzing and presenting
information.

Independent, third-party IndustryIQ reports
leave marketing and sales professionals free
to practice their core competencies:
developing successful advertising strategies
for their clients.
Since 1986, Profile America has provided
profiles of industries, markets and trends to
business-to-business marketers, facilitating an
understanding of the industries into which
they sell their products and services.
Delivery
Program Objectives

IndustryIQ reports are used by managers as
sales training, planning and business
development tools. Sales reps use IndustryIQ
reports to prepare for sales calls and as a
valuable leave-behind.

Armed with independent, third-party
assessment of industry dynamics, media reps
can “walk the walk and talk the talk” of their
advertisers’ industries, allowing reps to better
assist advertisers in creating compelling,
effective messages for their target audiences.

IndustryIQ reports incorporate a customerguided approach to gathering information and
creating industry-knowledge products. We
value your content recommendations as we
strive to create the most useful, fact-filled
industry reports available.

IndustryIQ reports are available in PDF format
from Media Marketing’s web site,
www.IndustryIQ.biz, and as ready-to-show
PowerPoint slides that seamlessly integrate
with your imMEDIAte presentations.
IndustryIQ is distributed by Media Marketing, Inc. in association with Profile America, Inc. for use by advertising sales representatives.
Although the information in this report has been obtained from sources that Profile America, Inc. believes to be reliable,
no guarantees are made as to the accuracy of the information presented, and any information presented may be incomplete or condensed.
4.1