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The Littlest Consumers’ Big Value in the Entertainment Industry
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The Littlest Consumers’ Big Value in the Entertainment Industry

While most kids aren’t big spenders, music, books, home entertainment, and video games geared for today’s youngest consumers generate big sales every year. But kids present opportunities beyond youth-specific entertainment. Children can become a strong secondary audience for adult entertainment with the right marketing and can build a loyal fan base as they—and their spending—grow. Across the industry, the importance of this consumer segment is evident.

Inspired by the Kids’ Choice Awards this weekend, we looked at some of the top titles that appeal to those under 13 and even some who are older. To understand tomorrow’s future buyers, marketers need to learn about their consumption habits and behavior.

MUSICAL INFLUENCES

Artists that can appeal to a younger demographic can gain from exposure to a secondary audience. The Kidz Bop franchise, which produces lyric-friendly versions of top hits, has released an astonishing number of albums, and its first and most popular release, Kidz Bop, has sold 960,000 units alone. Kid-centric movies can also boost music sales. The best-selling digital song of 2014 to date, “Happy” by Pharrell Williams, appeared on the Despicable Me 2 soundtrack and has sold over 2.8 million digital units. Another recent hit, “Let It Go” by Idina Menzel has tallied up over 1.4 million units sold and hails from the Frozen soundtrack, which is currently the top selling album this year to date with nearly 1.1 million units sold.

In addition, artists across genres can benefit from a younger following as their fans grow up. For example, Taylor Swift, Maroon 5, Justin Timberlake and Justin Bieber are 2014 Kid’s Choice Award nominees and have sold an impressive number of albums each: 22.7 million, 11.5 million, 11.8 million and 10.6 million, respectively. And past nominees, including Macklemore & Ryan Lewis, Carly Rae Jepsen, Lady Gaga, Katy Perry and Bruno Mars, have astounding digital track sales, selling 7.4 million (“Thrift Shop”), 7.3 million (“Call Me Maybe”), 7 million (“Poker Face”), 6.5 million (“Firework”) and 6.2 million (“Just The Way You Are”) units to date, respectively.

THE BUILDING BLOCKS FOR BOOKS

How children read is a hot topic when it comes to books, especially with the rise of e-books. In 2013, e-book sales made up approximately 16 percent (a slight decline from 15% in 2012) of all children’s book market sales, according to survey research by Nielsen*. But compared to Adult Fiction, where e-book share is now over 30 percent, children’s books are still being largely bought in print. However, how books are bought is also moving to digital—all books bought from online retailers and apps made up 27 percent of purchases in the past year. This affects “brick and mortar” retailers, whose purchase share fell slightly to 62 percent from 63 percent during the same period. Despite the slight decrease, however, the majority of children’s books are still purchased in physical stores. Publishers and retailers should pay close attention to these trends as new device and purchase options become available.

HOME ENTERTAINMENT FOR KIDS

If you’re a parent of a young child, words like “minions” and “Tinkerbell” are probably part of your daily conversation. In 2013, the total kid genre sales were down 8 percent over 2012. However, theatrical animated family titles did well during the year (up 12%) while Child NT (nontheatrical) animated titles were down 9 percent. 2013’s top five animated family titles were up 16 percent, mostly due to the success of Despicable Me 2. Building off the success in theaters, animated family titles can present marketers with the biggest opportunity to extend sales from the box office to disc and potentially beyond.

THE YOUNG GAMER

When it comes to gaming, young players make up a significant amount of playership. Demographics for gamers generally remain consistent from year to year—in fact, in both 2012 and 2013, consumers 0-12 years old made up nearly a quarter of overall playership (24%)**. In 2013, 6-12 year olds made up the largest age group in terms of playership with 18 percent of players, and were followed by 25-34 and 35-44 year olds (each age group made up 16% of players). The consistency of these demographics shows that these young players are ones to pay attention to when it comes to designing and marketing games.

Today’s youngest consumers are a big market in the entertainment industry and cannot be ignored. The content that appeals to this segment is significant and varied. Oftentimes, entertainment companies just need to capitalize on the opportunity younger consumers present to create a secondary audience for consumption. But the biggest benefit from the littlest shoppers is that, by paying attention to what titles kids are consuming now, marketers can build a growing audience and fully captivate these consumers as adults.

*Nielsen Books and Consumers survey data from January-September 2013.

**Nielsen Gaming 360 2013 report data collection period for 2013 is from Dec. 19-23, 2013. Data collection period for 2012 is from Oct. 22-26, 2012.