Baby care products to touch 4,200 crore by 2014



(82% working mothers prefer Baby care products: survey)

Despite slowdown, the Indian baby care products continues to grow at a compound annual growth rate (CAGR) of over 20% and expected to reach Rs. 4,200 crore by 2014 as against the current size of Rs. 3,000 crore including baby food, skin care, toiletries/ diapers, baby soap, oils, shampoo and creams, reveals the ASSOCHAM paper.

Factors that have fuelled this industry’s growth are rising income levels, fewer children per household and increasing aspiration levels among parents to provide the best for their children and so on, says an industry specific analysis of The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The baby care products in India currently poised to Rs.3,000 crore according to a study titled “Rising Demand of Baby Care products in India” released by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

While releasing the paper its Secretary General, Mr. D S Rawat said, “baby care market in India has experienced stupendous growth over the past few years due to changing consumer mindset and increasing penetration of baby care products. Others reasons are rising income level, better product availability and increasing awareness have significantly transformed the baby care products industry”.

“India has emerged as the most preferred market for the companies involved in baby care product manufacturing and marketing. The growing segment of population in the age group of 0-4 years has been providing tremendous opportunities as compared to any other baby product market worldwide”, adds the ASSOCHAM report.

“The market consists of baby hair and skin care products, toiletries and diapers. The hair care market for babies is valued at Rs 40 crore for 2012, and is growing at a CAGR of 5 per cent. The skin care market is valued at Rs 400 crore for 2012 and is growing at a CAGR of 15 per cent. The baby toiletries market is estimated at Rs 380 crore for 2012 and is also growing at 20 per cent annually”, mentioned the paper.

The paper further mentioned that the estimated online market for baby products around Rs 200-250 crore range and tends to double in within a year. Online baby-care market comprises of segments such as baby food, skin care, toiletries/ diapers, toys, gears and baby nursery.

The paper also said that around 30 million babies are born every year in India. Considering that even 10-15 percent of babies are born to parents who would spend annually a conservative figure of Rs. 6,000 to 8,000 on baby products (diapers, lotions, strollers, toys, gears etc), the potential is huge.

In a ASSOCHAM recent survey on “Rising Demand of baby personal care products in India” is based on responses from 2,000 representative joint and nuclear households because many consumers in metros lead time-pressured lifestyles and have less time available as a result of which demand remains high for these products.

Over 82% working couples prefers for these products as changing lifestyles, convenience factor and quality standards are taking up the priority in deciding for the baby care products in cities like Delhi, Mumbai, Kolkata, Ahmedabad, Chennai, Bangalore, Hyderabad etc.

The survey highlights that baby foods are preferred mainly by nuclear families where both husband and wife are working who do not have time, patience or the expertise to prepare in a traditional method.

According to survey, metropolitans are the largest consumers of baby care products because of their ever increasing per capita income and lifestyle which is also changing very rapidly.

Major metropolitan cities in which respondents were interviewed by ASDF (ASSOCHAM Social Development Foundation) include Delhi, Mumbai, Ahmedabad, Cochin, Bangalore, Hyderabad, Indore, Patna, Pune, Chandigarh and Dehradun and it was observed that there has been a surprising rise in the demand of baby care products with increasing trend among Indians of having one or two kids, parents today make every possible effort to provide the best to their kids.

These drivers are increasing income levels in the middle-class, increase in working women population, high birth rates, increase in awareness about child care and increase in willingness by parents to spend on baby care products for better overall child development, adds the survey.

So, there is huge expectation of the baby care market to show progress especially in the developing nations. The introduction of organic baby products can further boost the progress rate.

Mr. Rawat also said India is fast emerging as one of the world’s fastest growing baby care market with its vast consumer base and fundamental cultural shifts. Even in the tough post recessionary scenario, the industry continued to show strong year on year growth.

In a survey, ASSOCHAM also claims that baby food segment lags behind in joint family, followed closely by toiletries segment which comprises mainly of diapers and its accessories. The main reason for such a lag is the cultural barrier, which discourages pre-packaged foods for infants and also emphasizes on the importance of mother’s milk and freshly prepared food for the babies.

Other reasons that are responsible for the lag are that the packaged foods (including formula for substituting mother’s milk) are mostly imported and are very expensive at the retail price. Baby food products segment still remains strictly for rich Indian diaspora.

The report identifies that a vast prospect population will provide enough growth opportunities to new and existing players and will position India as one of the world’s biggest and fast growing baby care markets. Various factors such as, growing income level, increasing general awareness, and shift in consumer preference will propel the growth of Indian baby care industry.

As per the ASSOCHAM findings, India has the highest birth rate among the BRIC nations and countries such as the US and the UK. The per capita expenditure on baby personal care products is the lowest and the projected growth rate the highest, adds the paper.

Factors fuelling growth

  • Offering kids the best of the world:. Parents do not mind spending some extra bucks for the comfort of their kids.
  • Concept of small families: People prefer to stay in nuclear families and have a single child. Therefore all the attention is given to the kid.
  • Interrelation between disposable income and spending: Due to both couples working and earning, the disposable incomes have increased. Parents want branded clothes, soaps, shampoos and diapers etc for their babies.
  • Kid’s consciousness: Growth in this sector can be guessed by all the television commercials made on baby products.
  • Entry of international players: Earlier with limited brands in this sector, there was less awareness but now entrepreneurs as well as parents have recognised the demand of the market.
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1 Comments

  1. a.g.rajmohan says:

    When looking good is made a matter of commercial concern why not babies.

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