PMR: Children’s products market impacted by demography and pandemic

Wpis dostępny jest także w języku: polski

The market for children’s products in Poland grew in value by 4.4% in 2019 to reach PLN 15.08bn, according to PMR estimates. But it is on track for a contraction of more than 3% in 2020, as negative demographic trends are compounded by the shock of Covid-19.

A major barrier impeding the growth of the children’s products market in Poland is demography. The fertility rate is 1.43 children per woman, well below the 2.1 required for replacement of the existing population. The number of live births in 2019 declined by 3.4%, to 375,000 from 388,200 in 2018. The Central Statistical Office (GUS) predicts it will decline again in 2020, by 2.76%. Eurostat expects an even bigger drop, and projects that in January 2021 the population of children aged under 1 year in Poland will be 9.9% smaller than in January 2020.

Sales of baby food and of hygiene products for children are particularly closely correlated with births. We forecast that in 2019-2025 these two categories will experience negative compound annual growth rates (CAGR) of -0.8% and -1.4%, respectively. For the remaining categories of children’s products, i.e. clothes, shoes, furniture, cosmetics, and toys, we expect that rising household disposable incomes will offset the negative effect of demography to a greater extent, with increased spending per child.

Spending fairly resilient but migrates online

46% of Poles surveyed by PMR in September 2020 said Covid-19 has not affected their spending on children’s products. The proportion was higher among rural respondents than urban ones (50% vs. 43%). One in 10 reported a reduction in spending, including 12% of urban dwellers and 7% of rural ones. In terms of age groups, respondents in the 35-54 years bracket were most likely to report reduced spending.

More than a fifth of interviewees – 22% – said they go to physical stores less than pre-pandemic, and 28% said they buy children’s products online more often. The shift to online shopping was most pronounced among respondents aged up to 34 years (32%). There is no doubt that the online channel will be the biggest gainer from Covid-19. According to our forecasts, online sales of children’s products will grow in value by 25.2% in 2020, and the online share will continue to rise thereafter, reaching about 38% of the market by 2025.

More about purchases for children in the latest PMR report: Children’s products retail market in Poland 2020.

About autor

Magdalena Filip

Senior retail analyst

A senior analyst with ten years of specialization in the retail market in Poland and Central and Eastern Europe. Areas of specializations: clothing and footwear retail market, children’s products market and private labels.