Chinese families were recently fascinated by a TV show called “Where is my Daddy”, which presented scenes of several pop stars having fun with their kids in the Great Outdoors. Unfortunately, such outings are not common for most urban families with kids in China, the majority of whom would instead think it more convenient to spend their weekends in shopping malls.

The Kids sector has been very active in many Beijing shopping malls over the past two years. The Golden Resources Shopping Mall, Solana, and Living Mall all set up special areas of more than 20,000 sqm for shopping and entertainment for children. No longer is kids’ retail limited to clothing – the emphasis on activities is increasing. Living Mall introduced Mainland China’s first Snoopy Garden. In addition, international retailers targeting children, including Toys R Us and Mothercare, have rapidly expanded. Shopping malls have become fairylands for children.

Why are malls expanding the space allocated to the Kids sector? According to demographic statistics, despite Beijing’s slowing population growth, the birth rate has been picking up since 2010. We believe that recent migrants from other parts of China have much to do with the rising birth rate as they settle in Beijing and start their own families. The high-income earners of the educated Chinese middle-class have accounted for a large portion of Beijing’s newcomers in recent years, and this socioeconomic group in China tends to spend generously on their children. China’s booming consumer market further suggests that the trend is not unique to Beijing. The Children’s Trade Association predicts total spending in the sector to jump by 75% from 2011 to 2015.

Furthermore, shopping mall operators view the Kids sector as a draw to attract families and boost the time they spend within the mall, which in turn increases the amount of money they spend. Operators would like their centres to be all-day destinations. However, since rental affordability for kids’ brands may not be that high, landlords are not in a rush to expand the space set aside for children’s brands too quickly.

“Where is my Daddy” has reportedly encouraged many in the post-1980 generation to have children. Also, Beijing, as with many other cities in China, implemented a policy in March 2014 to allow more couples to have a second child – those with at least one partner from a single child family. In the past, only families where both partners were from single child families could have a second child. The rising number of new births is going to fuel strong growth in child-related spending over the next couple of years.

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