According to Juvenile Products: 2010 Edition, the most recent report from leading market research company The NPD Group, since 2007 when the original Juvenile Products report was published, there has been a decline from 47% to 40% in the number of U.S. consumers who buy gifts for kids ages 0-2 in an average year.

According to the report, which provides an updated view of the juvenile products market among gift givers and moms of young kids, while the percent of the population buying gifts in a typical year has declined, the amount spent on the two of the most popular gifting occasions: baby showers and holidays, has increased slightly, with new baby gifts experiencing the most growth from $26 to $29. Also noteworthy is that, in 2010, doting grandparents are spending the most on new baby gifts, spending an average of $72.

“Grandparents spend the most on baby gifts by a significant margin.  They are less likely to buy off a registry and report having a hard time deciding what to purchase for their grandchildren which makes them a tricky, but critical target market for juvenile products,” said Anita Frazier, industry analyst, The NPD Group.

The trend of more conservative spending continues as parents are spending notably less on their other children compared to their first child for all categories. Likely driven by the poor economy, when it comes to parents using juvenile products with other kids besides their first-born child, there are more parents borrowing/buying used clothes now than in 2007.

“With 80 percent of parents still buying clothing that is new and not used, the trend of parents borrowing or buying used clothes is still relatively small, but noteworthy,” said Frazier.

With an increase from 39%t in 2007 to 42% in 2010 for “word of mouth,” and a decrease from 31% in 2007 to 28% in 2010 for “health professional,” the parenting and/or baby product information that moms obtained via word of mouth trumps what health professionals think, even more so now than in 2007.

“Companies that compete in the juvenile products arena have noticed the power of  mommy bloggers who can serve as important, even critical, evangelists for their products, and are actively courting them as part of their marketing strategies,” said Frazier.

Most Popular Products and Sales Channels

For the entire juvenile product category, clothing & layette is the most popular juvenile product category purchased in the past year, followed by toys, and then books/music/video.

Mass merchants continue to be the most popular channel for juvenile product purchases among gift givers, while baby stores capture the highest average amount of money spent on gifts. Out of all channels, discount stores showed the most dramatic increase for buyers, increasing from 8% in 2007 to 11% in 2010, while Toy Stores showed the most dramatic decline, from 23% in 2007 to 17% in 2010.

[Source:  Juvenile Products: 2010 Edition, The NPD Group. 26 Jul. 2010.  Web.  28 Jul. 2010.]