NEW YORK (CNNMoney.com) - Forget the MTV generation. Today's up-and-coming rock stars are setting their sights on a whole new target audience: the sippy-cup crowd.

Children's music – or kiddie rock – is increasingly becoming the ray of light in an otherwise dreary period for the music industry, marked by declining sales and waning interest among adult consumers. According to Nielsen SoundScan, overall music sales in 2005 fell about 4 percent. 2005 sales information for children's music isn't available, according to Nielsen SoundScan, because kids' music isn't yet considered to be its own genre.

Laurie Berkner

"The audience for kids' music is more reliable than other genres," said Cliff Chenfeld, founder and co-owner of Razor & Tie, a New York-based independent entertainment company that markets that hugely-popular Kidz Bop series of CDs. "People that are buying (children's music) will continue to buy those CDs or DVDs for a longer period of time than a college student," who may experiment with different styles and download music rather than shell out the cash for a CD.

Chenfeld said the children's music movement really took hold in the last five years as more parents began to recognize the importance of music in their children's lives but were looking for artists that were also tolerable to an adult's sensibilities.

Parents reeling from the almost hypnotic and eerily repetitive Barney song were on the lookout for music that they could enjoy with their children.

To meet this emerging demand, Chenfeld and partner Craig Balsam in 2001 created the Kidz Bop series, which features children singing radio hits from stars such as Mariah Carey and Green Day. The ninth edition of the series last week debuted at number 2 on the Billboard Children's Chart.

Well-known rock stars such as Dan Zanes of Del Fuego, music band They Might Be Giants, and Devo (of Whip-It fame) also jumped on the bandwagon, working with Walt Disney (Research) Records to produce children's CDs and music videos.

David Agnew, executive vice president of Buena Vista Music Group, said children's music is a smart business decision.

"Almost 50 percent of all recorded music sold today is purchased by people over the age of 40, over 90 percent of whom are parents," he said. "So if you want to sell your music, this the perfect audience to appeal to."

That realization is driving a whole new wave of music artists, specifically writing and recording rock music for children.

The reigning queen bee in the kids music scene is 36-year-old Laurie Berkner, who has become the ubiquitous face of kiddie rock. Berkner, with her smooth voice, up-tempo guitar beats and catchy lyrics about anything from dinosaurs to spaghetti, has been called the Sheryl Crow of the diaper set.

Her music label Two Tomatoes recently partnered with Razor & Tie to release her first DVD of original kids' music videos, and Berkner penned a deal with coffee chain Starbucks (Research) to sell the DVDs in its stores. The DVD sold almost 16,000 units in its first week and has held at number 1 on the Billboard's Music Video DVD since taking the coveted position on Feb. 22.

"I'm so surprised that it happened this way," Berkner said in an interview. "I was afraid that (the DVDs) would be sitting there on the shelf and I didn't want to get my hopes up too high."

Berkner, who subsidized her music with teaching preschool and playing for children's parties, said the road to success was a bumpy one as she struggled to pay her rent and kept her independent music label afloat with credit cards. But guest appearances on national programs like the Today Show in 2001 and later music video spots on Viacom (Research)-owned preschool channel Noggin and its critically-acclaimed Jack's Big Music Show have helped turn the tide.

Jack's Big Music Show has also been an outlet for other emerging children's rock bands, such as Milkshake, Hot Peas 'n' Butter and The Dirty Sock Funtime Band.

"We started playing publicly two years ago but we definitely found that sales have been improving (in the last six months)", especially with Jack's Big Music Show," said Stephen Jacobs, who founded The Dirty Sock Funtime Band with brother Adam and friend Michael Messer. "We just got a manager with a calculator but we know that sales have exploded. We've probably seen about a 500 percent increase in sales over the last couple of years."

Messer said the band, which is distinguished by its rocking beats combined with its silly, visual lyrics (think Muppets take MTV), has no aspirations for putting out a rock CD for adults.

"The moment came when we were recording and writing (the album) 'Mr. Clown and the Day the Sun Got Wet' and we all sat back and said 'oh my God, we're on to something,'" he said. "We were laughing while we were coming up with stuff. We don't have to take ourselves seriously and have the freedom to have fun."

The band is currently in talks with larger record companies and TV networks to develop musical projects, Messer said, declining to provide further details.

Experts expect more and more large corporations to reach out towards kiddie rock as the market grows.

Murray Schwartz, partner at entertainment marketing agency RPMC, said pop music has become so saturated that it's hard to gain a real popular following. But more sophisticated children's music artists have developed a niche, particularly among parents interested in sharing their passion for music in a kid-friendly way, and that's leading to more investment in children's products.

And from a margin perspective, you can't beat children's music sales, said Razor & Tie's Chenfeld.

"Margins on a kids record are going to be better than a more traditional pop record," he said. "You're not spending crazy money to have Beyonce or Gwen Stefani do all the things they need to do to be successful. In the kids music world, you can be successful without having to get your song played on the radio."

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