This post is for informational purposes only and is not investment advice. We’re simply sharing our perspective on the baby industry.
Owning shares in a baby-focused company is a brilliant idea!! Over 10,000 babies are born in the US a day (according to the CDC). That's 1 baby every 10 seconds. We decided to do a case study on one of our favorite baby brands — Carter's. We wanted to see if the parent company known for their adorable designs and sustainable fabrics would be worth investing in.
Carter's
Age range: 0 to 10 years old
Niche: baby apparel, sleepwear, play clothes, and more
Carter's has been in the baby industry for over 150 years. In a recent annual letter, the multi-generational brand mentioned a passion for stylish and affordable gear for babies.
Carter's operates over 1,000 specialty stores in North America and serves international customers through global retailers like Cotsco. Within the US, Carter's has a physical presence in 49 states (except Alaska), and has the most locations in California (95), New York (50), and Florida (49). Many are strategically positioned in or near malls.
In addition to their own shops, Carter's can be found at well-known department stores like Macy's, Marshalls, Kohl's, and JCPenny. They also created exclusive brands for certain retailers. For example, "Child of Mine" is at Walmart, "Just One You" is at Target, and "Simple Joys" is on Amazon.
Carter's multiple distribution channels, has helped the company maintain a significant market share, and they continue to innovate to maintain it. The company launched little planet (an organic cotton brand) in 2021. In 2024, Skip Hop (their lifestyle brand) collaborated with Sesame Street, just in time for Prime day and the back-to-school season. The new line features backpacks and lunch boxes, with Elmo, Abby, and Cookie Monster.
While Carter's aims to stand out with distinctive prints and colors, the top selling and most preferred baby onesie on Amazon seems to be an 8-pack in plain white. More specifically, in June of 2024, Amazon customers bought over 5,000 unisex short-sleeve units by Gerber, compared to 1,000 of a similar product by Simple Joys. Carter's has been using sponsored ads on the e-commerce giant's platform, but may be getting increased competition from Gerber, Honest Baby, Amazon Essentials, and Disney baby (to name a few).
We found this insight important, because while Carter's serves children as old as ten, a majority of their sales are from products for children ages nb (newborn) to 2.
As more families move towards one-stop-shopping online, they may have to weed through third-party options that may not meet their needs or standards. Carter's has the opportunity to remain a reliable brand that families absolutely love, immediately recognize, and whole-heartedly trust to grow with their child(ren). With so much physical real estate, they're also in the perfect position to provide one-of-a-kind experiences, that can only be had in-store.
Summary
Carter's is a high quality brand with loyal customers and plenty of opportunities for in-person and online shopping. | Carter's may face increased competition as the next generation ages and finds convenience in shopping online. |
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