Baby and child-specific products was the second fastest growing category in total beauty and personal care in 2013. It remains something of a niche in an ageing world. Disposable incomes are rising while birth rates are falling and women are giving birth later, creating a challenging environment for manufacturers of baby and child-specific products. Opportunities remain in baby and child-specific skin care, but availability and awareness remain issues in emerging markets.
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In 2013, baby and child-specific products was the second fastest growing category in total beauty and personal care. Only deodorants registered faster growth. In current terms the 7% growth was largely due to Brazil and China.
Despite its rapid growth the category still represents only 3% of the total beauty and personal care market. Low birth rates across both emerging and developed countries will impact future growth. Encouraging government schemes in countries like Germany and Russia are however, expected to boost spending on baby and child-specific products.
While growth in baby and child-specific products has been sustained across all regions, China and Brazil will generate 66% of the total absolute growth between 2013 and 2018. China’s change in one-child policy to boost the category China is expected to contribute US$1.5 billion to baby and child-specific products' US$3.5 billion absolute growth between 2013 and 2018. Recent changes in legislation allowing families where one parent is a single child to have two children may accelerate growth further.
Turkey, Russia and Saudi Arabia – the next frontier Beyond China and Brazil, Turkey, Russia and Saudi Arabia are emerging as the next growth frontiers, with rising disposable incomes boosting demand and per capita spending.
While Johnson & Johnson’s global lead is undisputed, local competition in Brazil and China has presented certain challenges. The company trails behind local company Natura in Brazil, while in China regional player Pigeon and local player Prince Frog have been gaining share.
While private label remains important in baby and child-specific products, with over 11% of the market, lower birth rates and thus lower volumes, increases the need for higher margins. Premiumisation and even luxury is a niche that is growing in baby care, echoing childrenswear, where luxury and premium brands are expanding to baby lines. The rise of the “mini me” phenomenon combined with increasing disposable incomes, indicate that China, Turkey, Russia, UAE and Saudi Arabia are promising markets for premium brands.
Johnson & Johnson remains the leading player globally in baby and child-specific products. However, perceptions of local brands are changing and regional players, like Pigeon in Asia Pacific, and local ones, such as Natura in Brazil, Prince Frog in China and Green Finger in South Korea, are shaking up the competitive landscape, with Johnson & Johnson having to work harder to maintain its market leadership.