China's Children Are Growing Up in Shopping Malls
Yicai Global
/SOURCE : Yicai
China's Children Are Growing Up in Shopping Malls

(Yicai Global) Dec. 19 -- When the weather is bad, be it raining, or snowing, or the atmospheric conditions are poor, there are few places for parents to take their children. But, is it really the best option for kids to grow up in shopping malls?

Liu Danni, who lives in Beijing, intends to cut down on the amount of times she takes her daughters to shopping malls. Liu cannot remember a time when her two twin daughters, who are nearly four have not clamored after dinner to go to the shopping center. When this wish cannot be granted, they usually use the most common way of protest, crying.

Liu felt surprised, worried and also a little frustrated by their reaction. "My daughters love to go to shopping malls so much, I do not think it's good for them," said Liu, "but in Beijing in the winter, there are few places where I can take them to."

Haze and strong winds in autumn and winter, fluffy catkins from the city's poplars and willows in spring, which cause respiratory problems for some and hot sun in summer.

Any one of these factors is enough to make a well-planned outdoor play program fall through for parents who are most concerned about the safety and health of their children. It is not a good alternative to keep children at home.

As a result, shopping centers are becoming more and more like a children's paradise. In addition to a variety of recreational facilities, toy and clothing stores, more and more shopping centers have brightly-colored rides for children, in the image of their favorite cartoon characters.

As a lifestyle space with indoor activities, shopping malls can at least guarantee a normal level of comfort in every season with their central air-conditioning. This is very much welcomed by parents. When the weather is bad, but their children want to go out, a shopping mall is the preferred place.

Shopping malls which place high value on foot traffic are happy to see parents making this choice. After all, as long as customers enter the mall, they will consume.

Unplanned, yet reasonable consumption happens every time Liu takes her children to shopping malls. For example, when the children are tired, at least two glasses of fruit juice are needed. If it happens to be dinnertime, Liu usually chooses to eat in the mall.

"Every time we, a family of four, go to a mall, we spend at least CNY500. If one or two pieces of clothes or pairs of shoes are chosen, more will be spent," said Liu.

Another mother, Wu Yue told Yicai Global that her daughter Xixi, who is now four years old, counts shopping malls as her most frequently visited place apart from her home. Xixi has been going to malls since she was seven months old.

In her infancy, Xixi visited the swimming pool in a small shopping mall near her home, joined the mall's early education classes when she was one year old, and began to learn dancing in another shopping mall when she grew up. Xixi is a girl that is growing up in shopping malls and spending a lot of her childhood there.

"Opposite the dancing class, there is an art class, a martial arts class, a chess and Go class, and a toy store, all of which are centered around children," said Wu. She also saw that children's training institutions like to open in shopping malls. Shopping centers are happy to keep updating themselves and tailoring their business around kids and include more possibilities to consume.

A single shopping center contains over a dozen children-oriented businesses, including clothing, toy retail stores, children's playgrounds and early education training centers with similar products, all next to each other, according to incomplete statistics collected by Yicai Global from a number of shopping centers in Beijing.

"Children-oriented business are the engine for more foot traffic, which makes the shopping mall more attractive to customers in remote areas," said Wen Juan, the director of the publicity department of Joy City mall in Chaoyang district.

This large shopping mall, located outside the East Fourth Ring road in Beijing and bordering its further suburbs to the east, struggled when it first opened. In 2012, Joy City re-defined its target customers as young families from the ages of 25 to 35 and thereupon carried out a series of business adjustments.

They increased the proportion of children-oriented businesses on purpose. "Most children of 35-year-olds are at the preschool age," said Wen, "so at that time we organized several facilities and enterprises catering to children concentrating on this age group."

After the changes, the mall saw more customers with an increase of almost 30 percent in only a year. The change was apparent when many younger single coming to the mall to meet and hang out would find it hard to enter the elevators from the first floor during weekends.

These would be filled by families entering the mall from two underground parking spaces. Each family comprises at least three members, a couple and their child, and most would come with a baby carriage, with some of them even bringing grandparents and babysitters with them.

Customers with families take up a considerable proportion of the total in the shopping mall and it only takes two families to fill up an elevator.

The SOLANA Lifestyle Shopping Park in Beijing also reviewed and adjusted its children-oriented business within two years, as its business was initially moribund.

This uniquely-designed shopping mall is the size and shape of a small village, with paved streets. SOLANA is planning a 20-thousand-square-meter "Children's Town," where a single building would cover all the consumption needs for a child from the pre-natal stage to the age of 12.

Furthermore, the mall even introduced two international kindergartens and a postpartum recovery center to retain mothers as its loyal consumers early from pregnancy, so as to drive up other businesses in the entire shopping center.

"The potential of children-oriented business was noted early in 2011, when some stores in the SOLANA complex started selling children's clothes together with those for adults," recalled Lu Chao, the vice executive general manager of SOLANA.

"Children's clothing has seen a rapid growth in retailing and its turnovers are far better than that of adults' clothing in the same period," said Lu to Yicai Global. When his operational team became aware of that, "the idea of children-orienting would become clearer provided we put children-oriented businesses together."

Similarly, many other shopping centers noticed the value of children-oriented business during those years. The proportion of children-oriented business in shopping malls was only five percent in 2011, whereas this number rose to 15 percent in 2015, the survey results of HanBroad Business Institute provided by research director Liu Cuixiao found. In the current year, the growth of children-oriented business is still accelerating.

A survey conducted by the China Research Center for Children's Industry, found that 80 percent of respondent families spend 30 to 50 percent of their household expenses on their children.

Parents of the post-80s and post-90s generations take up the majority of the group, whose consumer needs ideas are more casual than their parents, who have more meticulous approaches to parenting and more demands in lifestyle. These factors are opportunities for shopping malls.

The highest proportion of children-oriented businesses in malls are amusement parks and retailing, a brand ranking report jointly published this year by HanBroad Business Institute and winshang.com found.

Currently, major indoor amusement parks in China mainly imitate or directly introduce the intellectual properties of Japanese and Korean theme parks, in terms of design or content.

A little penguin, called Pororo is a popular Korean cartoon character for children, which has an annual two-day carnival dedicated to him in South Korea. As her daughter, Titi, loves the penguin, housewife Zhao Xiaoxu has to drive her daughter for over 40 minutes to a shopping mall in Beijing, which has the first Pororo-themed park in China.

Sometimes, Titi waits at the entrance with her mother standing outside the gate before 10:00 am when the park opens.

The children's park has a miniature railway and bumper cars, as well as areas where mothers can create arts and crafts with their children. At set times, staff dress up as Pororo in the tiny theater to interact with children.

Zhao bought a membership card for her daughter, with which each visit only costs CNY200 on average. Due to there being no time limits for each visit, Titi would spend almost a half day there every time.

This 2000-square-meter theme park is operated by Shanghai Yuyuto Investment Co., Ltd., the largest enterprise in China dealing in chain amusement parks. The company, founded in 2010 is stationed in over 100 cities nationwide with over 240 outlets due to its expectation of growth in the children's amusement sector.

Yuyuto founder Chen Xiaofan started as a lawyer working in Japan. Regardless of his job, he always regards himself as a good seizer of mainstream opportunities. By chance, he learned that Akachan Honpo, the largest mother-and-child product producer in Japan planned to introduce its infant products and amusement park projects to China.

He became the Akachan's facilitator for its target country. After serving as the agent for Akachan's infant products for a year, Chen and his partners further laid plans in the new market of children's amusement parks.

In Chen's view, shopping malls mirror children's parks perfectly, for the latter would bring in weekday and weekend as well as family footfall, a measure of the number of people visiting a store, or a chain over a period of time. To bring in weekday and weekend footfall is something unachievable for other businesses.

"Having access to a satisfactory shopping center indicates a monthly turnover for Yuyuto totaling CNY300,000 to CNY400,000, with annual profits of almost CNY1 million (USD143,900)," said Chen.

In 2014, Yuyuto opened its first indoor theme park and now boast over 40 with an average area of 1,000 square meters. It also gradually introduced popular intellectual properties like Pororo the Little Penguin, Robocar Poli, Astro Boy, Ultraman and Naruto.

According to Chen, the cost for operating a theme park breaks down into 20 percent for rents and labor, respectively, as well as 30 to 40 percent for decoration and equipment in accordance with the tenancy period.

Currently, among children's theme parks in shopping malls, one of the largest brands is Aeon Fantasy which originated in Japan. It is a subsidiary of Aeon Group, a Japanese retailer. In 2008, Aeon Fantasy founded its first branch in China titled Aeon Molly Fantasy Beijing International Shopping Center.

Aeon Fantasy began to deal with indoor children's amusement parks as early as 20 years ago. It is now known as the largest indoor amusement park brand in Japan. The company owns 158 outlets in China, with 18 located in Beijing, Jin Ye, director of the general affairs department of Aeon Fantasy, told Yicai Global.

Toys "R" Us, a large American retailer for toys and baby products with over 1700 stores worldwide, entered the Chinese market in 2006 and began to accelerate store expansion in 2013.

By the end of this year, it will have more than 130 stores in 55 Chinese cities, equivalent to opening more than 20 stores every year. All stores in China are direct-sale stores.

"Nowadays, consumers tend to regard shopping malls as a one-stop destination for both shopping and entertainment," said Roy Sammartino, director and general manager for Toys "R" Us in China. The facilities provided by shopping malls meet the requirements of target consumers of the brand, so Toys "R" Us primarily opened stores in family-oriented shopping malls.

"In China, many people live in big cities, which means that children spend more time playing indoors," said Sammartino. He also observed that Chinese parents, especially those from families in first-tier cities are willing to spend more time with their children.

They pay attention to the education of their children and also seek high-quality toys and family-oriented entertainment experiences. In light of this, Toys "R" Us specifically caters to Chinese customers in its product selection and focuses on the introduction of experientially family-oriented toys and playthings that can promote the development of children's skills.

The "Star Card" membership program of Toys "R" Us has attracted more than three million members. Lego, Barbie dolls, Disney princesses, Hot Wheels, Thomas and Friends and Transformers are best-selling brands in the stores. Many stores promote new products according to the release schedule of movies or animated films as well as following market demand.

Almost all experientially children-oriented businesses, such as theme parks, various classes and early education programs are actively encouraging parents to buy a membership card. Usually, a card with unlimited use of the amusement park sells for between CNY2,500 to CNY4,000 in addition to the secondary card. The average consumption is about CNY100 each time.

The cost of a one-on-one piano class is CNY600 and a skating class for children is CNY300 per class, with 20 classes or more for the basic course. Early education and English classes for preschool children rank among the most expensive businesses with an annual fee of between CNY10,000 to CNY30,000 with an average of two or three classes a week.

Almost every mother has several cards. Liu Danni bought English and art course packs respectively for her two children, at a total cost of CNY60,000 (USD8,634) per year.

Every family spends one to two hours at a single store but more time at a theme park, at two to three hours, Yuyuto's research shows. Founder Chen foresaw such a long stay as an expected result of Yuyuto's facilities and services.

Previously, while children were in the amusement park, parents waited outside, playing games on their smartphones and getting bored. A number of overseas parent-child travel items have been developed by Yuyuto and will be promoted by the clerks to the parents when they wait for their children.

Many children take shopping malls as the playground of their childhood. Their parents also take shopping malls as nurseries with an integrated one-stop service. However, there are things that cannot be replaced by man-made products in children's lives, such as nature's attractions.

Young mother Zhao Xiaoxu found that as her daughter grows older, the shopping mall is now less attractive to her. "When she says she wants to go out to play, she means the world outdoors," she said.

 

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