Home Care: Half-Year Update H1 2023

September 2023

This Half-Year Review of Euromonitor International’s home care data is intended to provide analysis of the biannual update to Euromonitor International’s Forecast Model (FM), alongside the quarterly update to the Macro Model, offering insight into the most important current developments in the home care industry since the annual update published in January 2023.

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Key Findings

Consistent outlook for the first quarter of 2023, with modest downgrades relative to initial baseline

Euromonitor International’s Forecast Model expects an improved low single-digit value growth for home care across 54 markets over 2022-2027, with a marginal downgrade of volume sales. The outlook in North America has been revised upwards, due to improving economic indicators in the US, where sustained product price increases and a lack of downtrading opportunities are behind a higher-than-expected value growth in H1 2023.

Value outpaces volume across global home care, as consumers absorb price rises (for now)

The industry is seeing substantial increases in value sales in current terms. The disparity between value and volume performance will not be sustainable over the medium term, with both retailers and consumers likely to take action against further increases, driving higher private label share and growth of hard discounters and other value-based channels.

Commodity price pressures ease in some areas, fuelling a possible upside scenario in the second half of the year

Commodity price pressures have eased somewhat, particularly in the area of energy and packaging inputs. However, contractual obligations and wage inflation are delaying an immediate effect on net material inflation. Brighter GDP forecasts in the US and improving consumer mobility in China provide cause for optimism, with inflation expected to moderate over the second half of the year.

A growing price differential between private label and brands

Many of the major suppliers in the home care industry reported strong revenue growth at the expense of declining volume sales in the first quarter of the year. In a bid to keep downtrading among consumers in developed markets to a minimum, brand manufacturers will continue to invest in widespread marketing campaigns and high-value functional innovations in the second half of the year, with an emphasis on product superiority in performance.

About this briefing
Key findings
Rising prices sustain strong home care growth in nominal terms, despite softer volume
Improvement relative to Q1 expectations, driven by brighter US and China indicators (1/2)
Improvement relative to Q1 expectations, driven by brighter US and China indicators (2/2)
Resilient GDP growth in US and moderating inflation introduce the possibility of Bounce Back
Countries showing the largest revisions from our February baseline
Commodity cost pressures ease in the first half of 2023
Consumers and retailers may have reached their breaking point in terms of price rises
Procter & Gamble: Strategy is focused around superiority of product performance
Unilever: Portfolio rationalisation paired with higher investment in marketing and innovation
Success of private label is putting increased pressure on multinational brands
Key markets are at different stages of inflation cycle resulting in different price trends
Slowing e-commerce growth for home care categories as cost of living increases
Global baseline outlook: Optimism increases amidst weak and fragile growth environment
Global inflation slowdown comes with increasingly diverging trends between key economies
Real GDP annual growth forecasts and revisions from last quarter (1)
Real GDP annual growth forecasts and revisions from last quarter (2)
Home care system update schedule

Home Care

This is the aggregation of laundry care, dishwashing products, surface care, chlorine bleach, toilet care, polishes, air fresheners and insecticides.

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