Kids’ Retailing in India-Is it a failed proposition?
Posted in Marketing & Strategy Articles, Total Reads: 10222
, Published on 04 February 2014
Kids’ retailing started in India about a decade ago. The scope of kids’ retailing includes the entire gamut of apparel, fun toys, eyewear, sportswear etc. As organized retailing is making its presence in India due to the increase in income levels of people and due to an aspiring middle-class income group this segment is destined for some phenomenal growth in the years to come. The challenge however remains to understand the kids' psychology and understand the consumer preferences. The segment mainly targets kids up to 12 years of age.
Major players in the various categories
This is the major revenue earner for the kids’ retailing sector. This write-up focuses the discussion mainly on this segment. Some of the renowned players in this segment are Giny and Jony, Lilliput and Catmoss. KPMG estimated the size of the kids’ apparel segment to grow to Rs 43000 crores by 2016. However high debt and high rental costs are taking a toll on the existing players with the existing players also joining the bandwagon with their offering of kids wear.
The toy market is estimated to be around Rs 450 crores. Some of the big players in this segment are Funskool, Leo and Mattel toys. However the toys market in India is mainly dominated by local players and they also easily copy the designs of the branded products.
What drives the sector
i) As families are becoming more and more nuclear and with increase in disposable incomes the market is seeing remarkable growth
ii) Kids are attracted by store-ambience and attractive merchandise. Organized retailing gives them the flavour
Major problems of the kids’ retailing
i)High rent costs are a major problem and most of the stores find it hard to break even especially if they are in a tier-2 cities
ii) The brand recall is very poor in this segment due to poor advertising and no endorsement by celebrity.
iii) Financial irregularities have sent out wrong signal to the investors making the companies cash strapped and look for costlier options of debt
iv) Entry of rivals with deep pockets. Mahindra entered with its own Kids retailing store mom and me. Other brands like Allen Solly, Pantaloons and Raymonds have also rolled out their kids wear section. These brands with their aggressive marketing strategies can capture the minds of the customers from the original players very quickly
v) As the other stores are launching their own kids wear segment within the store the chances that the entire family will complete the shopping under one roof increases
Turnaround strategy for the existing players
i) In most of the purchases the mother plays a very important role. So the brand should position itself as something that gives value for money to the customers. Some of the brand attributes can be comfort, ability to retain colour after multiple washes. These things are most looked after when women make purchases
ii) The retailing should also adopt store-in-store format because most people are unlikely to come over to a retailer for purchasing kids wear exclusively
iii) Introduce wide range of colours and designs. The brand should also make promises of emotional benefits like aesthetic pleasure, Joy and excitement.
iv) Buzz can be created with a sms campaign or a teaser campaign.
v) In store display can also attract the kids to the store again and again. E.g. Hangers in shape of animals, mascot at the gate. Child mannequins can also be used.
vi) Pull strategy giving loyalty programs to the consumers that makes them do repeat purchases again and again.
vii) Direct marketing by partnering with reality shows and kids channels like Cartoon Network, Pogo etc.
The strength area for home-grown players lies in their expertise in sourcing and designing. But in order to capture distinct places in the minds of consumer the players should resort to aggressive marketing.