Cashing in on kids

While fast fashion is seemingly beginning to slow, and luxury retailing is gaining steam with international consumers, a separate section of the fashion market is beginning to mature.

Kidswear is seeing an increase in investment from players in the fashion industry, driven largely by the mini-me phenomenon; the movement that is beginning to see parents and children dress in identical clothing, effectively creating a miniature version of themselves.  

Off the back of this popularity, the infant and children’s clothing retailing industry has achieved steady growth over the past three years, despite the difficult overall retail conditions, with an estimated annualised increase of 1.3 per cent over the five-year period through to 2020-21, and is estimated to be worth $3.6 billion.

UK fashion marketplace Net-A-Porter entered the children’s fashion market in late January, with the release of its first multi-brand kidswear collection known as Casual Kids.

“We’re testing the market, as we realise the strong potential for growth in this category,” Net-A-Porter global buying director Elizabeth von der Goltz tells IRW.

“There’s a convenience we can provide for mothers who can now shop for themselves and their children on the same site at the same time.”

The expansion was natural, von der Goltz says, as the mini-me trend has acted as a catalyst for the rise of luxury kidswear.

“Our customers have been highly engaged with all of our kidswear pop-ups last year, with most of the styles selling out within weeks of launching,” von der Goltz says.

“It’s interesting to see how some of the sold-out styles, such as the Gucci-logo T-shirts and belt bags, were in high demand in the adult range as well.”

Accent Group observed the same trend in the time it has been running The Trybe – its own kidswear marketplace – in that, generally, what is popular with older kids tends to trickle down to the younger ones.

“If a Vans shoe is very strong with your teenage kids, by that I mean 16 to 25 [years of age], there seems to be a direct correlation that it’s going to sell in the younger kids, six- to 12-year-olds,” Accent Group chief executive Daniel Agostinelli explains to IRW.

“That has been very obvious, and that makes it easy for us… We feel that there are some great easy wins if we get it right.”

Accent Group launched the kids’ footwear focused e-commerce site The Trybe in late 2018, offering 24 of its brands in kids’ styles, as well as exclusive collections.

“We thought that at some point we would want to play in this area… and saw an opening, particularly as we distribute a lot of kids’ brands that were not getting shelf space out in the retail stores and in digital online stores,” Agostinelli says.

“So, we thought, ‘Let’s try a website; let’s see what happens’.”

Agostinelli notes that sales have been “okay” – “nothing to write home about” – but that the concept has done so with very little investment and effort, and that as a result the group is beginning to explore the idea of dedicated bricks-and-mortar The Trybe stores.

“We’re currently looking for at least four stores around the country, wherever it makes sense, and that’s going to allow us to expose that footwear to the market, [as well as] allow us to appease our brand principals who want to see us sell more kids’ shoes,” Agostinelli says.

“It’s a win, win.”

These investments are also partially due to a global trend of luxury brands beginning to lean into the kidswear category, with brands such as Gucci and Balenciaga beginning to feature more and more kidswear, especially on social media.

“It’s quite interesting,” Agostinelli says.

“I think it’s a movement. It’s fashion. Mini-me is a big thing. A lot of celebrities are dressing up their kids and are driving that through Instagram and social media, which is driving a lot more people to want to be that.”

According to Agostinelli, however, there are definite disadvantages in the space: price points are typically lower, which makes achieving sales targets more difficult, as well as putting further pressure on bricks-and-mortar locations to sell enough in order to build a positive sales-to-rent ratio.

“We’ve got a bit of learning to do. We’ve never run a kids-only store, so there’s an element of risk,” says Agostinelli.

“In the adult world, or in the teenager world, we know that a size five or a size 13 is hard to sell – we don’t know what [the comparable] issues are in kids yet.

“There are complications we are prepared to work through in order to learn.”

Similarly, online fashion marketplace The Iconic launched its own kidswear portal – The Iconic Kids – due to realising customers were searching for kidswear on its main marketplace.

“Our customers are at the heart of everything we do,” The Iconic chief category management officer Mareile Osthus tells IRW.

“Launching an entirely new category is a large undertaking for any retailer, but despite the challenges, we knew it was something we had to do.”

This effort was made easier by the fact that many of The Iconic’s brand partners had existing baby, kids, and teen offerings within their product portfolio, creating an opportunity to not only expand their partnerships but also onboarding new kids brands.

According to Osthus, the kidswear market is relatively untapped across Australia and New Zealand, and presents a huge opportunity for growth.

“We’re only six months into this journey and we’re already seeing customers diversify their basket by including kidswear; it’s incredible to see the uptake,” Osthus says.

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