While manufacturing and appearance are the basic differences the reasons for choosing between analog and digital watches for kids have more to do with function and style than anything else. If kids like the appearance of an analog watch then they’ll likely be drawn to the smaller, less bulky and more fashionable type of watches.
While digital watches may have sleek designs, they are often bulkier and come with many more functions. If your child is likely to want a stopwatch and timers then a digital watch is likely to please them more. The only downside to digital watches for kids is that they're not time teaching watches so if you're looking for a product that will help your child read the clock stick with analog.