Rising birth rates have ensured that the baby diapers market, growing at a healthy 18-20 per cent year on year, is estimated to reach Rs 11,964 crore by 2017, with three nations accounting for the massive jump.
A new report has emphasised that along with India, the diaper market in West Asia and Africa is growing at a fast clip, with babies in these regions expected to use about 8 billion diapers a year by 2017.
A report by Transparency Market Research said India is expected to have the fastest growth among these three regions, though Africa would be the largest in terms of volume and value amongst the three regions. The report said the global diaper market is expected to grow at a compounded annual growth rate of 11.6 per cent from 2012 to 2017.
In India, the baby diaper market is currently pegged at Rs 1,400 crore. Supported by favourable demographics with 26 million babies born in India every year, the potential is huge. “The diaper market is experiencing a surge in demand for sanitation products,” said Bhavana Seth, wellness consultant at a Mumbai hospital.
Demand is largely driven by the rapidly expanding infant population and increased awareness of personal hygiene. “The growing participation of women in the workforce, increasing disposable incomes and the continuous increase in purchasing power is ensuring high growth,” Seth added.
Several multinationals have entered the lucrative Indian baby care market, which has led to players investing heavily on product innovation and development to capture a significant share of the overall market. India's changing preference from traditional cloth nappies to disposable diapers has also propelled growth.
Girish Kalyanaraman, Brand Manager, Pampers India, Proctor & Gamble, told Business Line, “Cloth conversion is a key driver across consumer segments. Pampers has more than a majority share of the baby diaper market across India, including rural India.”
When Pampers was launched in December 2006, the category was around Rs 110 crore. In the last seven years, Kalyanaraman said, Pampers has grown the category to more than 10 times, and continues to spearhead the category growth.
It is not just urban India that is part of the growth story. Sales of baby diapers in rural India have jumped over Rs 200 crore. For the past two years, market estimates suggest diaper sales in rural India have grown by over 150 per cent.
“This is a clear indication that consumers are choosing to buy branded good quality diapers for their babies,” said Kalyanaraman. “The change in preference to baby diapers is because more and more consumers are realising the health benefits like cognitive and physical development due to overnight sleep,” he added.
The advent of technology has further helped in grabbing consumer attention, by providing them with easy-to-use hygiene solutions.
Disposable diapers constitute the largest market share and are seeing increasing investments by manufacturers in their research and development.
In India, price continues to be the main impediment and diaper brands have been steadily trying to correct the price-value equation.