I have a few youngsters, including a couple of 5 year olds and this is what I've learned.
1. The most important thing to do is keep things fun. This will help keep the attention level up. I do this in a number of ways.
1 a. First lesson. I ask the child if they want to have a bash around and make lots of noise. The usual answer is a shy yes, followed by a hesitant bang on a few things. I then suggest they can hit more things and make even more noise. This usually gets a smile followed by what I suggested. A comment such as "Playing drums is fun eh?" said with a big smile usually garners a positive reaction.
1 b. I then show them how to hold the stick, but I am not dogmatic about them holding it exactly correct. I usually work on this over the following weeks in a very easy going manner. I figure the kid wont have fun if I am obssessing over his or her grip.
1 c. Using the right book. I enjoy using the Drumming from A to B junior edition. This book has cartoons, BIG WRITING and lots of helpful hints. It can also be used as a coloring in book. The kids love this aspect of this work. I have had great results using this and highly recomend it.
1 d. Colored marking pens are incredibly useful with small children. I assign different colors to each limb. Children seem better able to read when they recognise the colors; e.g blue for the right hand, orange for the left etc. NOTE It helps to keep the colors very different. I use red for one hand and blue for the other. Not a combination of blue and green or anything similar.
2. Pacing the lesson.
2 a. Each child is different. I have found that I must be flexible, very flexible when teaching small kids. I am happy to move on completely from my lesson plan if the childs begins to drift. One youngster who began with me 2 years ago at 5 years old is still with me and was playing along to Booker T tunes just yesterday. But when he began 2 years ago his lesson was at most 15 minutes long followed by 15 minutes of bashing around while I kept time for him. Anything to keep the interest and fun levels up.
Another child however was better able to keep his attention and more devoted to practice and his lessons were more serious. Yet still fun. He too is still with me and plays all kinds of advanced rhythms, New Orleans funk, Latin, and other assorted grooves. Yet....He doesn't really like technique. He thinks of grooves as songs and tires of paradiddles and such. So, I hide paradiddles within grooves and fills and whether he knows it or not, he practices them. So you see, a little creative deception can get results.
2 b. Another advantage I have found is to involve the parents and sibblings. I have no hesitation of getting them into the room as soon as a breakthrough of any kind is made. This excites the child and makes the parents proud and all that follows is positive. I mentioned on this site recently that I had a family dancing to a young man's first lesson. You should have seen the kid's face! His mother and sister dancing to a single stroke roll. I kid you not. Drumming bliss!
2 c. Try to remember everyone's names! Always appear excited to see the child and parents. If you can get to a position of trust by being friendly and positive, the results can be overwhelming. I have drawings on my fridge that were presents from young students. I even had a 6 year old call me when his football team won their final match, on his birthday! So excited was he to tell his drum teacher.
3. Using music that the child likes.
I always find out what songs the kids like. Often at this age they don't know individual bands, but they do know songs. I get them to bring in CDs and help them play along. This playing along may only be clapping on 2 and 4, it doesn't matter how correctly they play it. I also use shakers and lightweight tambourines. (I've also used a quica to make funny noises to Wiggles tunes. This always gets an hysterical laugh. Especially if the sound is similar to the kids dad breaking wind) Of course a quica is not a necessity, but fun is the idea. You get the picture.
The bottom line is to keep them coming to lessons and keeping them interested. There is no hurry. If the child returns week after week, he or she will learn. If they get bored and quit they wont learn anything. I love teaching these little kids. I know a lot of teachers hate it. I'm lucky, I've always been loved by dogs and small children. ;-)
Good luck with it and I hope you can enjoy it as much as I.