Demand for designer names and brands with a story to tell is helping the childrenwear market stay buoyant through difficult retail times.
More from: The children's stories behind stellar sales
Next month, designer kidswear independent Base Fashion will open its seventh store, in Birmingham’s Grand Central shopping centre. It is part of the retailer’s gradual multichannel expansion, which will include more stores next year and the extension of its ecommerce site to markets outside the UK.
Base Fashion’s steady growth is indicative of the opportunities in the kidswear market. Changing demographics in the UK are contributing to increased demand, a report by market research company Euromonitor published in February indicates. A baby boom in 2011 has spurred growth against a wider backdrop of retail headwinds. In 2018, the UK kidswear market was worth £6.7bn, up 2.7% from £6.52bn the year before.
Base managing director Marc Granditer tells Drapers: “We’re increasing our budgets and seeing increased sales. Demand is there. The kids’ market is slightly more immune to the pressures facing retail, because parents will always need to buy new clothes as their children grow.”
Arianna Vaccas, director of communications at luxury kidswear etailer Childrensalon, agrees: “The kidswear market has been growing exponentially to cater to different trends, styles and price positioning.”
Retailers that sell luxury childrenswear and brands with strong stories to differentiate them are doing well. However, some bricks-and-mortar independents are struggling with property costs, and going online only.
Luxury etailers Net-a-Porter and Mytheresa both launched kidswear sections in January.
“Trends in women’s and men’s wear continued to filter down into childrenswear in 2018, leading to a shift more towards the premium end,” states the Euromonitor report. “Millennial parents are spending more on their children than ever before.”
Mytheresa Kids launched with 35 brands, including Burberry, Dolce & Gabbana and Fendi.
Michael Kliger, Mytheresa president and chief executive, explains: “The casualisation of luxury makes it much more suitable for kids. There’s also a move away from ‘mini-me’ dressing, which is not just creating the exact same dress and shoes that their mums have. That is a good business in itself, but the real boost is coming from kids-specific product.”
Ecommerce has driven the boom in luxury kidswear sales, and many retailers point to online growth in international markets such as the US and United Arab Emirates. Sunderland independent Designer Childrenswear’s international online sales have been doubling year on year, and now represent 40% of total online turnover.
“The US, UAE and Saudi Arabia are big markets for us,” explains ecommerce manager Dionne Evans. “Americans buy a lot of Burberry, and it’s easy for us to sell in the US as they are English speaking. The UAE is growing, and there’s trust because we’re an established retailer. They’re buying the high-value items.”
Granditer hopes to launch Base Fashion’s online offering – currently 30% of total sales – into international markets next year: “The big one is the Middle East, and [consumers from] Japan and Malaysia are really hungry for luxury. We haven’t decided on which markets to focus on, but we’ll probably go for the Middle or Far East.” Base Fashion stocks brands including Balmain, Burberry, Stone Island and Moschino.
Supermarket brands continue to dominate in terms of sales volume, Euromonitor’s report found, led by Asda’s George label. However, high street retailers such as Next are catching up. For independent brands striving to find a clear point of difference from the high street, a powerful story is increasingly key to success.
Tess Grindle, co-owner of independent Our Kid, in Chorlton, Greater Manchester, says: “Brands are having to work harder to cut through competition from the high street. Storytelling within independent retail is more important than ever and we find that labels with meaning, such as Scamp & Dude and Mutha.Hood, continue to outperform what I would consider to be ‘normal’ collections.”
Scamp & Dude was established by Jo Tutchener-Sharp in 2016 after she suffered a brain haemorrhage, and aims to give a sense of security and confidence to children and adults during difficult times.
Mutha.Hood launched in 2017 to empower women and girls through “positive, strong and meaningful” messaging on its clothing. The brand now has 12 UK independent stockists and six internationally, and sells direct to consumers via its own site.
Founder Gemma Metcalfe-Beckers tells Drapers: “Independent brands struggle to stand out against the high street and make a good margin. Also as [brands] move towards more ethical practices, that necessitates a higher price point. But if you build a message with a brand ethos behind it, that can help you differentiate yourself from others.
“[Mutha.Hood’s logo] ‘Strong Girls Club’ encourages girls and women to believe in their worth. Instagram has allowed us to build a brand message behind it. It’s not just a logo: there’s a story. People have a real connection to it.”
Our Kid is launching an own-label collection this summer. It comprises eight pieces, including long- and short-sleeved vests, a sleepsuit, playsuit and T-shirts. The longer-term ambition is to wholesale, says Grindle: “[The brand] is rooted in our Manchester heritage thanks to the use of our trademarked Our Kid slogan. We’re referring to the range as ‘Original Manchester Material’. Our customers respond to provenance and storytelling, and, now we have established Our Kid as a brand, we feel it’s the right time to grow the business with our own label.”
Not all childrenswear independents are thriving, however: some have struggled with the cost of bricks-and-mortar over recent months. The FMLY Store in Bruton, Somerset, Home & Kids in London’s Blackheath, and Annual Store in Lincoln have all closed their stores this year, to focus on online.
Granditer believes bricks-and-mortar stores boost brand awareness and online sales: “We have a small customer base online in Birmingham, but we know there’s a big market. If we have a store there, they will shop online, too. That’s the value of opening stores: to get the brand out there.”
The 2,600 sq ft Base Fashion in Grand Central will be followed by one or two further openings in 2020, at locations to be confirmed. “We can see the value in opening in strategically important locations, on the right terms – and there are deals to be done now on stores you couldn’t have dreamt of two to three years ago. I’ve highlighted four locations to look at if we can get the right deal (related to turnover).”
Our Kid’s Grindle agrees: “The physical store [accounting for 70% of sales] provides us with a compelling identity and leverage for online. Our website continues to offer us the greatest opportunity for growth, and will take precedence in terms of focus and resource over the next 12 months. We’re reviewing the whole customer journey experience, from newsletter sign-up to packaging. Harnessing our unique point of difference is going to be key to bringing the two sales channels in sync.”
Finding and promoting that point of difference is becoming crucial in the buoyant yet competitive kidswear market. While consumers are still seeking value for money and convenience from supermarkets, appetite for independent and designer brands with a mid-to-high-end price point is growing. See our pick of the brands overleaf.