Nappies/Diapers/Pants in the Philippines

PROSPECTS

Population growth and rising incomes to spur growth despite challenges

Babies and infants continue to account for a considerable and growing proportion of the Philippine population and this is combining with economic growth and rising incomes to support strong growth in sales of nappies/diapers/pants. In addition, the category continues to evolve and become more complex as awareness of the range of products available expands.

Manufacturers will need to target a young consumer base

Another key driver of increased nappy usage is rising demand for baby products in general, due largely to rising demand among young mothers, who are usually the primary decision makers for household spending. These so-called “millennial mothers” place more emphasis on convenience and are more discriminating in their product choices, making them more open to influence than traditional mothers.

Internet retailing emerging as a key distribution channel for nappies/diapers/pants

The e-commerce website Lazada is increasingly playing a key role in nappies/diapers/pants’ ongoing growth in the Philippines. The availability of nappies online through Lazada, usually at lower prices than in stores, is heavily promoted both by the internet retailer and the category’s leading brands.

COMPETITIVE LANDSCAPE

Local brand EQ remains in the leading position in nappies/diapers/pants

The category-leading brand EQ is owned by the leading local tissue and hygiene manufacturer JS Unitrade Merchandise. One advantage that JS Unitrade has over its multinational rivals is its solid understanding of the local market.

Pampers is EQ’s main challenger in nappies/diapers/pants

Procter & Gamble’s Pampers ranks second in nappies/diapers/pants, although it is losing ground to its local rival. Pampers’ price positioning is not significantly higher than that of EQ, and considerably lower than Kimberly-Clark’s Huggies, which makes the brand affordable for a significant proportion of consumers.

Low-cost brands continue to struggle to match their higher-priced rivals

As consumer choice in nappies/diapers/pants is not entirely price-driven, cheaper brands account for a relatively low proportion of overall category sales. Local economy brand Happy Diapers, priced at around PHP7 per unit, remains some way behind the category leaders.

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