Home care sees positive current value growth
The essential nature of home care for households supported its current value growth in 2013. However, home care still slowed in current value performance during the year in view of the maturity of various categories. Consumers’ shift within different product types in the same category such as from spray/aerosol air fresheners to gel formats also constrained the overall growth potential of various categories. On the other hand, consumers were willing to trade up to more premium variants that can offer them added value such as multipurpose and convenience.
Consumers are increasingly value conscious
Strong marketing campaigns from players on the benefits of concentrated home care products such as laundry detergents at the end of the review period managed to take stronger effect on consumers’ minds in 2013. Consumers’ hectic lifestyles continued to drive their demand for convenience, especially to ease their load from household chores. Heightened media publicity and various education campaigns on environmental issues also raised consumers’ willingness to play a part in saving the earth. These factors thus contributed to consumers’ rising demand for concentrated home care products, enabling them to use less product to achieve the same or even better cleaning effect that also means being more eco-friendly.
International players form a strong barrier
The top five home care players are Kao (Hong Kong), SC Johnson (HK), Unilever Hong Kong, Lam Soon (Hong Kong) and Reckitt Benckiser HK, together accounting for more than half of home care value shares in 2013. Comprehensive product portfolios, aggressive marketing campaigns and most importantly, their longstanding presence in home care make these players almost impenetrable. Consumer loyalty to these international brands remains strong, as they trust the product quality offered. Domestic players and private label thus find it challenging to gain a strong foothold in home care, especially with their limited resources and product range. Therefore, 2013 saw these domestic players and private label still mainly competing on price points whereby they offered budget products for low-income consumers.
Convenience spurs retailing
Supermarkets remained the leading distribution channel for home care and its value share further increased during 2013. One-stop shopping convenience coupled with the wide outlet network of supermarkets in Hong Kong makes it easy for consumers to pick up home care products when needed. Strong bargaining power of supermarkets over their suppliers also make it possible for them to offer more competitive prices or even regular promotions versus other distribution channels, thus further attracting consumers to supermarkets. Though it still only accounts for a small value share, consumer demand for convenience also benefitted the performance of internet retailing during 2013. Ability to shop at any time of the day whilst enjoying doorstep delivery remained a key driver for this channel in 2013.
Home care to stagnate
Home care is expected to stagnate in constant value over the forecast period, mainly due to the maturity of various categories such as polishes and toilet care. Consumer demand for convenience is unlikely to falter in the forecast period, with them continuing to seek multifunctional home care products that can reduce the need to use different products for cleaning. The switch within different formats in the same category will thus continue to limit the overall potential of home care in the forecast period. Despite this, consumers will remain driven to trade up to premium home care products as long as they can justify their value-added benefits, especially if they can ease the cleaning process.
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The Home Care in Hong Kong, China market research report includes:
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This industry report originates from Passport, our Home Care market research database.